Love them or hate them, cryptocurrencies do not appear to be going away anytime soon. In fact, new cryptocurrencies are being created all the time. CoinMarketCap has reported that there are now more than 23,000 cryptocurrencies that have a combined market capitalization of $1.1 trillion. Most of these cryptos are obscure and worth microscopic amounts of money. However, while Bitcoin (BTC-USD) and Ethereum (ETH-USD) remain the two biggest and best known cryptocurrencies, there are many other digital coins and tokens available to investors. Plus, many of the smaller cryptos have been enjoying big rallies in 2023. Cryptocurrency analysts even forecast that some of the smaller cryptocurrencies today could eventually eclipse BTC and ETH in terms of their price and importance to areas such as decentralized finance (DeFi). As the market continues to grow, we look at three cryptocurrencies with huge return potential for long-term investors.
Bitcoin Cash (BCH-USD)
Bitcoin Cash (BCH-USD) is one of the better known “altcoins,” which is a cryptocurrency created from a fork of Bitcoin. Created in 2017, BCH has been recovering this year from a sharp downturn in 2022 as cryptos entered a bear market. Since January, Bitcoin Cash’s price has increased 24%, erasing much of the loss it experienced over the past year. Many crypto bulls have been cheering on the current rally in Bitcoin Cash, believing that it is superior to Bitcoin, on which it is based.
Advocates of Bitcoin Cash point to the many ways in which it improves on Bitcoin. The big advantages of Bitcoin Cash are that it offers faster transaction speeds and is easier to mine than Bitcoin. The fees associated with Bitcoin Cash are also lower. Bitcoin transactions continue to be one of slowest of any cryptocurrency due to its strict network verification process. Proponents point to these facts as proof that Bitcoin Cash is a better long-term investment than Bitcoin. BCH also trades for a fraction of what it costs to purchase one Bitcoin these days.
Within crypto circles, Monero (XMR-USD) is a popular privacy coin. This means that XMR is a cryptocurrency whose transactions are completely anonymous and cannot be traced. Monero’s underlying blockchain employs privacy technology that hides from view the sender, recipient and amount of each transaction. The level of privacy provided by Monero is attractive to many users. However, it has also led to criticisms that the cryptocurrency can be used for unlawful activities, including money laundering.
Created in 2014, Monero’s price has appreciated significantly in that time, having gained 83% since 2017. At its current level of around $155, XMR is also one of the higher priced cryptos, most trade for fractions of a penny. However, more recently, Monero has gotten dragged lower by the downturn experienced by all cryptocurrencies. Its price has fallen 38% over the last 12 months. Many crypto enthusiasts remain bullish on Monero, saying that increasing regulation around the world is going to push more users towards the privacy offered by the crypto.
Huge Return Potential: Cardano (ADA)
Cardano (ADA-USD) has enjoyed a big run so far in 2023, having gained 54% year to date. However, it is still trading at just below 40 cents a token and overall is down 56% over the past 12 months. In fact, Cardano’s current price is 86% below its all-time high of $2.85 reached in August 2021. Cardano competes with Ethereum when it comes to DeFi and smart contracts. Cardano’s underlying blockchain technology got a big boost in 2021 when it completed what’s known as the “Alonzo hard fork.”
Some analysts say the Alonzo upgrade put Cardano on equal footing with Ethereum. Yet investors can buy ADA for a fraction of the more than $1,800 that it costs to purchase one Ethereum token. ADA is now preparing another upgrade, called “Hydra,” that promises to make it an even more powerful and efficient cryptocurrency. The utility of Cardano, which has only gotten stronger with each upgrade, is what separates it from other small digital coins and tokens. Trading for less than $1, now might be a great time to get in on ADA.
On the date of publication, Joel Baglole 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.