After the great success of Bitcoin in 2017, many investors turned their eyes to the cryptocurrency market. They all are looking for the next most profitable cryptocurrency to invest in. The reasons are clear. Those who invested in Bitcoin before at an early stage saw their assets grow 1,300% in a short time. Some lucky ones became millionaires.
However, some other cryptocurrencies have performed even much better than Bitcoin. Did you hear about the 36,000% gain of Ripple? Well, there is no doubt that Bitcoin is still the most traded cryptocurrency in the world. But if you are serious about investing in the crypto market, then you have to consider other cryptocurrencies.
It is unlikely that Bitcoin’s value increases as in 2017 again. Thus, to speculate in the crypto market, you have to diversify your investment. You cannot buy just one cryptocurrency. Because of the high volatility of most cryptocurrencies, putting all your eggs in one basket is a formula for failure. Do not do that, ever!
This is why in this article you will find out which cryptocurrency to invest in 2020. Rather, cryptocurrencies you should consider for your investment portfolio. If you are new to the crypto world, you will find this article very useful. Experienced investors can benefit from this insight too. Ready to learn which is the best cryptocurrency to invest in this year? Let us begin.
How to Know Which Cryptocurrency to Invest in Today for Profitability?
Speculating in cryptocurrencies is risky. You have to know this from the very beginning. So, to reduce any risk, you have to diversify your investment. This way you can compensate for any possible losses that one specific cryptocurrency may suffer. But, if you choose to invest in the most promising cryptocurrencies, you increase your chances of gaining.
But then again, how to know which cryptocurrency to invest in? There are some characteristics you have to pay attention to:
• Price volatility. The value of many cryptocurrencies can increase or decrease drastically within a short time (one day, for instance). Hence, the best cryptocurrencies to invest in, at least for a beginner, are those with less volatility;
• Liquidity. Cryptocurrencies that are not well-known cannot be sold easily. Hence, cryptocurrencies with high liquidity are most recommended;
• Market adoption. Even though cryptocurrency is supposed to be an alternative to fiat money, in practice this is not always true. A very few cryptocurrencies are accepted as a payment method to buy goods or services. Hence, cryptocurrencies with higher market adoption are better investments.
• Now you know better how to identify which cryptocurrency to invest in today. However, you need to be familiar with the different cryptocurrencies in the market (there are more than 1,500 cryptocurrencies today).
• But if you do not have much knowledge about the different cryptocurrencies, do not worry. Below you will find the list of the most promising cryptocurrencies to invest in.
Which Is The Best Cryptocurrency to Invest in This Year?
Now, the experts tell you which cryptocurrency to invest in now. If you create a diverse portfolio with the following cryptocurrencies, your chances to make a profit are big. Here we go:
• Bitcoin (BTC). This is one of the relatively safe investments in the crypto market. This cryptocurrency benefits from very high liquidity, which is the result of a high market cap. Although it is unlikely to see again a value surge similar to that of 2017, small gains could be still possible;
• Ethereum (ETH). Ethereum is just second to Bitcoin when it comes to market cap. Hence, its liquidity is good. Some investors are buying large stocks of this cryptocurrency. Some experts think that Ethereum may have a significant value growth in the coming years;
• Ripple (XRP). This cryptocurrency is largely used in money transfers. Investors that purchased assets during its initial coin offering (ICO) saw a gain of 36,000% in 2017. Although something similar may not happen again, this is still a promising investment;
• EOS (EOS). This cryptocurrency is characterized by its low volatility. Hence, many investors trade on EOS actively and it may represent a good investment opportunity;
• Bitcoin Cash (BCH). This is a fork of Bitcoin (BTC), but in a relatively short time has earned big acceptance. In terms of market cap, BCH occupies the fourth place. Although it is not as accepted as BTC, this cryptocurrency should be seriously considered for your investment portfolio;
• Litecoin (LTC). This is one of the few cryptocurrencies that is accepted as a payment method to purchase goods (at specific shops only). Like other cryptocurrencies, LTC has a sharp value growth in 2017. Although it has lost much of its value since then, this is still a profitable investment.
This list was compiled with the advice of experts in the crypto market. There are many other cryptocurrencies you can invest in and possibly make a profit. But the list above is most suitable for beginners and experienced investors alike.
Conclusion and Final Thoughts
Now, you probably have a better idea of the cryptocurrency which one to invest in. Bitcoin is the obvious choice for many. You probably would say: “mine too!” But to make a profit, you should invest in different cryptocurrencies.
When creating your investment portfolio, use part of your money to buy well-established cryptocurrencies. Such investment gives you liquidity and protects you against price volatility. The rest, use it to buy riskier cryptocurrencies.
Although many investors prefer buying assets during the ICO of a new cryptocurrency, this is not recommended for beginners. Even though a tremendous value rise is common after the ICO, so is a fall.