The newest U.S. exchange-traded Bitcoin fund made quite a splash recently. The strong launch quickly amassed more than $1 billion worth of assets, making this ETF the center of attention for those enamored by cryptos and their potential.
In a bold move that could revolutionize finance as we know it, the ETF market has been primed for change. Several Wall Street analysts anticipated four Bitcoin futures exchanges to begin trading following approval by the SEC this October.
The waves of anticipation that hit Wall Street when the first Bitcoin ETF was announced have all but disappeared, as demand for this new type of investment soars off the charts.
Valkyrie Investments’ Bitcoin Fund became the second to debut on the markets after the ProShares Bitcoin Strategy ETF. Several other Bitcoin futures ETFs are expected in the coming months.
They’re targeted at U.S. investors who want a chance at making up some ground lost over here in Canada and Europe, where dozens or so exchange-traded products tracking both spot prices as well as futures contracts exist already.
However, do not forget that these ETFs cannot replace the thrill and returns of investing in individual coins. Yes, they are volatile. However, they also have the ability to give you multifold gains, which is what every investor wants. Here are seven such coins that offer functionality and usability:
- Bitcoin (CCC:BTC-USD)
- Ethereum (CCC:ETH-USD)
- Cardano (CCC:ADA-USD)
- Tether (CCC:USDT-USD)
- Monero (CCC: XMR-USD)
- Zcash (CCC: ZEC-USD)
- Ripple (CCC:XRP-USD)
Cryptos to Buy: Bitcoin (BTC)
It is tough to gauge the impact Bitcoin has had on the investing world. It launched 12 years ago on the heels of the global financial crisis. Although it had a tough time initially, it quickly ushered in the digital currency boom.
Soon, thousands of coins launched in its wake, and they continue to do so. However, none of them have knocked Bitcoin from its perch. BTC is still the number one token out there.
The initial Bitcoin is a cryptocurrency that uses the proof-of-work (PoW) model to sequence transactions on its blockchain securely. Miners resolve mathematical equations and earn digital coins as rewards for their troubles.
One of the best things about Bitcoin is its hard cap, which is 21 million bitcoin. Investors will come flocking to the coin whenever there are fears surrounding inflation, confirming it as an excellent store of value. The recent rallies also confirm that Bitcoin is not going anywhere anytime soon. The coin recently touched a record high of $68,106.91, making investors bullish on the asset.
Many people perceive Ethereum as a competitor to Bitcoin, but both of these digital currencies have vastly different purposes. Therefore, it is incorrect to mix them up.
Bitcoin wants to become a store of value and replace fiat money. Ethereum was created to allow developers the freedom of creating and publishing their smart contracts without risk of downtime or fraud.
Much like Bitcoin, Ethereum is on a roll at this point. Part of the reason is its shift proof-of-stake (PoS) from proof-of-work (PoW). That shift is going to take place next year.
However, there are several updates along the way. And in the runup to the launches of these updates, the latest of which was the “London hard fork” upgrade, ETH prices tend to soar.
As it keeps on increasing its utility, Ethereum will continue to grow by leaps and bounds. The latest example is growth in the non-fungible token, or NFT, space.
It’s easy to see why Ethereum is outpacing Bitcoin in terms of return. It has been doing this for years, and even when comparing returns over the past five months or so — which may not seem like a long time but is still enough to make a difference in your portfolio.
Cryptos to Buy: Cardano (ADA)
Charles Hoskinson, a co-founder of Ethereum and Cardano, has been working on developing this platform since 2015. He created it in 2017 as a third generation of cryptocurrency to store value or send and receive funds.
It uses proof-of-stake technology, which consumes less energy than traditional mining systems and gives more power back in coin ownership, creating fairness among users who hold different quantities or values within their wallet balance sheets.
The best thing going for Cardano is its dual-layer infrastructure. The two layers, a settlement layer, and a computation layer, are beneficial for different reasons.
Thanks to the Settlement Layer, ADA can settle transactions between peers in this network. The Computation Layer provides smart contracts with optimizations geared towards supporting decentralized applications. That way, it targets both Bitcoin and Ethereum users looking for an alternative.
Recently, IOHK, the development team behind Cardano, has been working alongside the Ethiopian government to help them in their education industry.
Tether is an example of a stablecoin, designed to be linked with the fiat currency, for example, the U.S. dollar, and backed by collateral. Cryptocurrencies are not known for their stability.
Hence, stable coins like Tether are all the rage these days. Tether says it has $1 in reserves for every coin issued, which means traders can easily transform their dollars and trade them on exchanges.
Initially, Tether was built on Bitcoin’s blockchain, but it can now work on other blockchains, including Ethereum. Tether is highly centralized in nature. Hong Kong-based company Tether International matches up the coins with dollars on the platform.
Lower fees and ease of doing transactions mean Tether will continue to leapfrog traditional banks and financial institutions. People might not want to transact with Bitcoin or Ethereum because of volatility. For them, Tether is a great alternative, driving demand.
Cryptos to Buy: Monero (XMR)
In the last year, Monero has seen incredible growth in value. It is highly secure and anonymous, using ring signatures and stealth addresses to make it difficult to trace Monero transactions.
Governments the world over are looking to regulate cryptos. With that, there is the inevitable loss of anonymity. For many, one of the main advantages of cryptos is privacy. When that begins to erode, investors will look elsewhere as well. That is why Monero is excellent in the current atmosphere.
The sender and receiver of a transaction on Monero are hidden through ring signatures to obscure their identities. This makes it impossible for anyone outside the conversation to know who sent or received what amount. It is a feature that makes this crypto-currency an excellent choice in areas where privacy matters most. It is worth noting that Monero enforces anonymity at a fundamental level, and it is not optional.
ZCash arranges transactions among either private (z-addresses) or transparent (t-addresses). By implementing the Zero-knowledge Proof, Zcash has created an option for participants to obscure transactions.
When using this tool, you can hide information such as amounts and addresses of parties involved in a trade or purchase.
Although ZCash is not as popular as Bitcoin or Ethereum, it still will attract those investors looking for strong privacy features. In addition, Zcash’s blockchain also has features that allow Bitcoins to serve as a store of value. That gives you yet another incentive to invest in this one.
A total of 21 million ZEC coins are in circulation. Zcash is likened to BTC due to its scarce mineable token supply and reputation for being valuable as an investment vehicle because of this attribute.
Cryptos to Buy: Ripple (XRP)
Ripple is an innovative digital currency that could revolutionize the way people and businesses transact worldwide.
A lot of investors are excited about Ripple because it offers speed, security, and cost-effectiveness like no other cryptocurrency out there but with one big difference. It’s built on blockchain technology.
This means users don’t need to worry about chargebacks or fraud while also having their transactions verified within seconds rather than days like Bitcoin does at present.
XRP was designed for speedy transactions. It is meant to compete with the sluggish speed of banking systems like SWIFT, making it unique among a sea of cryptos. The buzz around the decentralized currency XRP is growing, but not everyone agrees that it’s truly independent.
The SEC has charged Ripple CEO and XRP founder Chris Larsen with operating an unregistered equity offering worth $1.3 billion. Since the lawsuit was made public, XRP has oscillated alongside the developments of the case. Ripple has been scoring victories as of late in the case. Nevertheless, the lawsuit makes it a tad bit risky to invest in this one.
InvestorPlace does not regularly publish commentary about cryptocurrencies that have a market capitalization less than $100 million or trade with volume less than $100,000 each day. That’s because these “penny cryptos” are frequently the playground for scam artists and market manipulators. When we do publish commentary on a low-volume crypto that may be affected by our commentary, we ask that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: How to Avoid Popular Cryptocurrency Scams
On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience analyzing the stock market and was a former data journalist at S&P Global Market Intelligence.