28 July 2023
Profitable cryptocurrencies to invest in
Cryptocurrencies are an important part of the financial markets, and despite their volatility, more and more traders are interested in trying to trade them. Many investors are eager to participate in the pre-sales of new cryptocurrencies, driven by the desire to discover the next popular cryptocurrency and make a significant profit. However, the cryptocurrency market is extremely volatile and risky, as you can lose everything or reduce your profits by 90% overnight.
Promising cryptocurrencies for investment
If you've decided to invest, it's time to choose from hundreds of thousands of cryptocurrencies, each with different dynamics. We have selected 5 promising cryptocurrencies for you to buy in 2023.
Bitcoin (BTC) is the first cryptocurrency and the largest by market capitalization. Since its launch, this cryptocurrency has experienced tremendous growth, and despite the drops, it has continued to make epic comebacks. Bitcoin is on every trader's wish list and is of interest primarily to large investors.
Ethereum (ETH) is the second-largest cryptocurrency by market capitalization. Ethereum was created specifically for smart contracts and decentralized finance tools, as well as for so-called Web 3.0 applications and trading in non-fungible tokens or NFTs.
Solana (SOL) is a cryptocurrency aimed at high transaction speeds while maintaining decentralization. The blockchain platform allows for the deployment of scalable contractual agreements and has significantly lower transaction fees. Solana processes 50,000 to 65,000 transactions every second.
Litecoin (LTC) is the second oldest cryptocurrency, created from the Bitcoin protocol in 2011. Litecoin transactions are processed at a fraction of the cost, making it a more affordable option for companies and individuals. LTC uses a different mining algorithm than Bitcoin, known as Scrypt, which makes it more secure.
ZCash (ZEC) is a cryptocurrency and decentralized blockchain. The level of confidentiality in Zcash is under the control of the user, who determines the access to transaction details. Users can confidently make purchases, investments, and donations, as the network allows both transparent and anonymous transactions.
What to consider when choosing cryptocurrencies
There are a lot of cryptocurrencies on the market, but not all of them are worthy of attention. Both beginners and experienced investors need to do their research, be aware of market trends and the risks that come with them, and be careful. Pay attention to the following factors before trading:
- market capitalisation
The potential and popularity of cryptocurrencies can be gauged from their market capitalization. Companies with small capitalizations are prone to fluctuations and are exposed to high risk, while large capitalizations are the safest cryptocurrencies for beginners because they have less risk.
- profit history
You can view the cryptocurrencies that have achieved the highest profits over a certain period. Yes, this is not a guarantee of high returns in the future, but this way you can make your judgments with the help of statistics and historical data.
- growth potential
Pay attention to the length of time a cryptocurrency has been on the financial market. This inconspicuous but no less important factor allows you to identify promising cryptocurrencies that are interesting to large investors.
Also, do not forget to analyze the security and reliability of the cryptocurrency, its protection against possible hacks, the presence of a team working on its promotion, and feedback from the community that is actively involved in trading this currency.