If you’re looking to expand your crypto investments beyond Bitcoin, there are lots of new options. Here are 5 to look into for the new year.
Looking Beyond Bitcoin for 2021
When you’re investing, it’s always smart to diversify. Adding cryptocurrencies or blockchain platforms to your portfolio is a great place to start. The mystery and volatility that surround this up-and-coming currency can turn some investors off of it, but once you understand how cryptos work, it’s a great new frontier for investment. Eventually, you may want to dabble in other currencies and platforms besides the ever-popular Bitcoin, like the 5 in this list.
Many people have become fans of using cryptocurrencies because they allow secure payments without intermediaries, leaving banks out of the payment process entirely. Cryptocurrency is also gaining acceptance for use as a convenient form of payment at many businesses, like virtual marketplaces and online casinos. Plus, more so than on the money you have sitting in the bank, you have the chance to earn good returns when the value of your currency jumps—like the tripling value that Bitcoin saw in 2020.
1. Litecoin (LTC)
If you’re not familiar with cryptocurrencies, they may seem needlessly complicated. That’s the idea that the makers of Litecoin built their business on. They thought the technology that powered Bitcoin was a bit too complex, so they set out to make a “lite” version of the popular currency. In 2011, Litecoin was born as a spinoff of Bitcoin, which allowed much faster transactions than the currency that inspired it. Plus, Litecoin has lower system requirements for mining, so most consumer PCs are actually capable of mining it.
Litecoin is up 212.69% over the last year, and if its rise continues, that could be huge news for crypto investors.
2. Ethereum (ETH)
Ethereum isn’t just a cryptocurrency platform…it’s kind of a philosophy, too. Building on one of the main benefits of crypto—decentralizing currency—Ethereum’s Ether became the second most popular cryptocurrency in the world. Its makers want to decentralize the whole internet by rethinking our current server system. Its blockchain-powered platform lets users exchange different currencies, too.
3. Tronix (TRX)
Tronix is another crypto that’s been popularized because of the platform that hosts it, Tron. The site is beloved by content creators who can make money without sacrificing their data to big tech companies. As more people than ever are making their money online, Tron’s creator-focused business model could help it displace some of the other giants in the online entertainment industry, making it an interesting currency and platform to watch out for.
4. Bitcoin Cash (BCH)
Bitcoin cash, as its name suggests, is an offshoot of Bitcoin that allows more scalability and greater transaction processing. Its creator’s intention was to make a crypto that was easier to use day to day, which he did by making the blocks larger (32 MB instead of Bitcoin’s 8 MB). That means that more transactions can be processed per block, which make the payments much faster, with up to 25,000 transactions per block.
5. NEO (GAS)
NEO is a similar platform to Ethereum that came from developers in China. The platform is also built on blockchain with the goal of digitizing assets, and it can process an impressive 10,000 transactions per second. On NEO, GAS is the token you can use for transactions and smart contracts.
Neo’s year-to-date returns are up 75.51%, making it an attractive prospect for the coming year if it continues to perform.
Where to Start
Before you jump into cryptocurrency investing, it’s good to get some background information on the technology and learn about details like transaction fees. It can also be volatile—just look at how Bitcoin fared in 2020.
The good news is that there are lots of sites that let you easily invest in crypto, even if you’re not an expert in the technology itself. You can buy crypto through popular services like Coinbase, Robinhood and Kraken.com. It’s not much different than investing in regular stocks, making it an easy way for even casual investors to diversify. There are also lots of different options like crypto IRAs and savings accounts if you want to go a step further.