17 was a great year for cryptocurrencies as their market capitalization grew from about $18 billion in January 2017 to $800 billion in January 2018.
Unfortunately, after that, we saw a huge correction as the prices of almost all of the top 10 cryptocurrencies crashed and their market capitalization reached a low point of $254 billion at the beginning of April 2018.
In this guide, I am going to share with you an overview of the most popular cryptocurrencies. I will talk about their advantages, disadvantages and also their investment history.
So, by the end of this guide, you will not only know the top cryptocurrency 2020 but also the reasons behind their popularity.
Let's get started!
Our first top 10 cryptocurrency is Bitcoin.
Created in 2008, Bitcoin was the first ever cryptocurrency. The interesting thing about Bitcoin is that no one knows who created it. All we know is that he/she/they go by the pseudonym of Satoshi Nakamoto.
Bitcoin is a digital currency based on a distributed ledger technology named blockchain, which you can read more about here. Bitcoin eliminates the need for centralized intermediaries like banks and credit card companies etc. when making electronic payments.
If you want to pay 1 BTC to your friend, you can do it directly without having to involve your bank at all. So, two words to describe Bitcoin would be — decentralized and digital. Its aim is to create an alternative for fiat currencies, like USD, GBP, JPY, etc.
- One of the reasons why BTC is among the top 10 cryptocurrencies is that the oldest one, it has the biggest community of developers and investors backing it for further growth.
- It is easy to purchase Bitcoin, even for beginners, as it is supported by all the top exchanges and wallets.
- Bitcoin is being adopted in the mainstream economy. Bloomberg, Microsoft, Overstock.com, Expedia.com and many others have started accepting payments in BTC.
- With a very slow transaction speed, Bitcoin is facing huge challenges in scaling up. A Bitcoin transaction takes about 10 minutes, and its network can process only about 7 transactions per second.
- Mining, which is an important activity for any cryptocurrency, has become highly energy-intensive in the case of Bitcoin. Bitcoin mining is now possible only with expensive, super powerful hardware that uses lots of electricity.
- Transaction fees for sending Bitcoin are also at an all-time high, making it less feasible.
In 2010, you could get 1 Bitcoin (BTC) for less than a dollar and in December 2017, the price of one BTC reached a high of $17,900. As you can see in the snapshot below, BTC grew by almost 2000% in 2017 alone.
Like all other top 10 cryptocurrencies, BTC too saw a huge dip in the Q1 of 2018 and has been fluctuating ever since. Its price has experienced another significant dip in December of 2018.
BTC, with a market capitalization of $163 billion, has a market share of about 36%. Bitcoin is the starting point of the cryptocurrency world and hence it is undoubtedly the most popular cryptocurrency.
Ethereum is the second most valuable cryptocurrency after Bitcoin. Created in 2015 by Vitalik Buterin, Ethereum is actually much more than just a digital currency.
Ethereum is a blockchain-based platform for developing decentralized apps and smart contracts. Ether is the native cryptocurrency used for all the transactions on Ethereum’s blockchain.
Note: Smart contracts are the agreements coded on the blockchain and they execute themselves on the fulfillment of certain pre-set conditions.
What this means is that if you have an idea for a project/application that uses blockchain technology, you do not need to develop your own blockchain. The reason why Ethereum differs from the other top 10 cryptocurrencies is that you can start building it on Ethereum’s blockchain instead.
Pros of Ethereum
- It is the most popular platform for building smart contracts, something which is considered the next big thing in the cryptocurrency universe.
- Ethereum provides a great platform for launching the Initial Coin Offerings (ICOs) for other blockchain projects. The majority of the $5.6 billion worth of ICOs in 2017 was launched on Ethereum.
- Ethereum has a transaction speed of a few seconds against the 10 minutes or more of Bitcoin.
Cons of Ethereum
- Like Bitcoin, Ethereum is also facing serious issues regarding scalability. It still uses an obsolete mechanism (Proof-of-Work) to verify the transactions which are leading to network congestion. This is the same mechanism that Bitcoin uses, so just like Bitcoin, Ethereum demands a lot of electricity. It is important to note, though, that Ethereum is actively working toward a solution for this.
- Ethereum only supports one coding language — Solidity. Since developers need to learn a new language, it acts as an entry barrier for them.
- Ethereum is facing stiff competition in the market from coins like NEO and Cardano which are offering similar platforms but with improved technology.
Ethereum has been one of the best performers of the top 10 cryptocurrencies of 2017. As you can see in the snapshot below, the price of Ethereum grew from $9 in January 2017 to $1389 in January 2018 giving a return of 17,000%!
Currently, Ethereum has begun crashing again. With a steady downwards streak, it started showing signs of rising from the ashes once again in January 2020. Second, only to Bitcoin, Ethereum has a market capitalization of $77.5 billion.
With very strong fundamentals and an excellent team, Ethereum definitely deserves its spot among the most popular cryptocurrencies.
Ripple is a very unique cryptocurrency as it is focused on solving problems related to just one industry — International Payment Transfers. It was founded in 2012 with the aim to make international transactions both fast and cheap.
Of the total number of 100 billion XRP that will ever exist, 50 billion are owned by Ripple labs (the company behind Ripple).
This is a very different approach compared to most other top 10 cryptocurrencies where there is no central entity holding the majority of the coins.
Pros of Ripple
- An international money transfer takes about a week. On the other hand, Ripple can make it happen within seconds. Also, the fees are considerably lower when compared to what is charged by financial institutions and other cryptocurrencies.
Note: The above image is from the 2017 December and Bitcoin fees have significantly reduced since then.
- Ripple has a very clear use case — international payments. The team is able to deliver the best solutions targeted at one particular industry.
- Ripple is among the few cryptocurrency platforms which are being tested out in the real world. Ripple has strategic ties with many major financial institutions and is currently being used by American Express and Santander.
Cons of Ripple
- Since the company itself owns half of the coins, it is often criticized for being centralized whereas decentralization is the core idea behind cryptocurrencies.
- Banks and financial institutions, which are Ripple’s biggest users, have started developing their own cryptocurrencies for international payments.
Even though Ripple has been around for a long time, it hopped on the growth vehicle only in the Q2 of 2017. But since then, it has grown to become the 3rd most valuable cryptocurrency among the other top 10 cryptocurrencies with a market capitalization of $34.12 billion.
In fact, XRP was among the top performers of 2017 as its price grew from around zero in January 2017 to about $3.65 in January 2018. Like other cryptocurrencies, XRP crashed and touched its bottom of $0.48 in April 2018.
Since April, Ripple has experienced a lot of difficulties trying to climb back up in price. Some signs of growth can be seen as of December 2018, but are they here to stay? Only time will tell.
Bitcoin Cash (BCH)
As the name suggests, Bitcoin Cash has been forked from Bitcoin itself in 2016. When the developer community of Bitcoin could not come to an agreement regarding the changes required in Bitcoin’s code, it was forked into BCH and it currently ranks in the middle among the top 10 cryptocurrencies.
Note: A fork is when a cryptocurrency is split into two. Parent cryptocurrencies retain their features while the child cryptocurrency undergoes technological improvements.
The purpose of creating BCH was to solve some of the existing problems of Bitcoin, especially regarding scalability and transaction fees.
Pros of Bitcoin Cash
- Bitcoin Cash transactions are faster than Bitcoin transactions because of the increase in block size to 8MB as compared to the 1MB of Bitcoin.
- Average Bitcoin transaction fees are currently around $1.8 which has gone down to $0.067 in the case of Bitcoin Cash.
Cons of Bitcoin Cash
- Bitcoin Cash, like Bitcoin, is expected to be completely decentralized.
- BCH mining is as expensive as Bitcoin mining but gives lesser returns, so it is not a favorite among the miners.
- Bitcoin Cash is not as easily available on cryptocurrency exchanges as the other top 10 cryptocurrencies.
Launched just in 2016, Bitcoin Cash has grown very quickly to make it to the top cryptocurrency list. It grew from about $500 in July 2017 to about $4,000 in December 2017, giving a return of around 10,000% in less than 6 months.
As you can see in the graph below, the price of Bitcoin Cash has also been experiencing a steady downfall since ay 2018. With a few signs of life, the future of BCH is still quite uncertain.
EOS token was launched through an ICO in June 2017. EOS’s platform, which was expected to launch in June 2018, is due to be a direct competitor to Ethereum and NEO.
EOS has been created by Dan Larimer who is also the founder of the cryptocurrency exchange Bitshares and blockchain-based blogging site Steemit.
EOS is building a platform for developers to build decentralized applications and smart contracts, but with a vast improvement in technology.
Pros of EOS
- EOS is supposed to be much more scalable than Ethereum because it uses an advanced mechanism (Delegated Proof-of-Stake + Byzantine Fault Tolerance) to verify transactions. It is allegedly capable of achieving 10,000-100,000 transactions per second.
- Unlike some of the other top 10 cryptocurrencies, EOS supports multiple languages, including C++.
- EOS has a highly experienced team with a proven track record.
Cons of EOS
- The biggest issue is that the platform has still not been launched so no one knows for sure how good or bad it actually will be.
Launched in July 2017, EOS raised $700 million in its ICO over by the time January 2018 came by. It has raised even more since then. As you can see in the picture below, EOS has an on-going ICO which opens up for short time periods at regular intervals. You can check more details here.
As you can see in the chart below, the EOS token price has grown considerably since its ICO launch. In fact, it is one of the few cryptocurrencies which was least affected by the market crash which happened in 2018.
All things considered, EOS is undoubtedly one of the top cryptocurrencies for 2020.
Cardano was created by Charles Hoskinson, Ethereum’s co-founder, in September 2017. Like Ethereum, Cardano has also been developed as a platform for decentralized apps and smart contracts.
Like EOS, the difference between Cardano and Ethereum lies in the many technological improvements it has made over Ethereum’s technology. Cardano is being considered as the 3rd and most advanced generation of blockchain technology yet (just as EOS and NEO are), making it one of the top 10 cryptocurrencies of 2020.
Pros of Cardano
- Cardano is supported by an academic community of global researchers and scientists contributing to its blockchain development.
- Cardano is much more scalable than Ethereum with a current capability of 257 transactions per second.
- Cardano intends to bring about Interoperability meaning that it can interact with different cryptocurrencies and their infrastructures in a seamless manner.
Cons of Cardano
- A lot of ideas that have been proposed by Cardano are yet to be developed into the final product. So, it remains to be seen whether they will be successfully achieved or not.
- There is already huge competition in this space, from Ethereum to EOS and NEO to Fusion.
In spite of being a very new cryptocurrency, Cardano has shown exceptional growth and reached a market capitalization of $9.35 billion.
Cardano grew from about $0.20 in October 2017 to touch a price of $1.20 in January 2018, giving a return of about 500% in 3 months. Like other top 10 cryptocurrencies, Cardano’s price crashed in March 2018 but it is now showing signs of revival.
Litecoin was created way back in 2011 by Charlie Lee, an ex-Google employee. It was built on the blockchain of Bitcoin itself, with the purpose of improving it.
So, like Bitcoin, Litecoin is also just a digital currency and does not provide a platform for smart contracts.
Litecoin has one of the most popular cryptocurrencies as it has stood the test of time and has been around for over 7 years.
Pros of Litecoin
- Litecoin transactions take around 2.5 minutes while it takes 10 minutes to complete a Bitcoin transaction. This is the reason that it is called the “Lite” coin.
- Average Litecoin transaction fees are around $0.179 against $1.8 of Bitcoin.
Cons of Litecoin
- Except for transaction speed, there is no other offering from Litecoin which can significantly differentiate it from others. It is facing stiff competition from coins that offer privacy, smart contracts, and international payments, etc.
- Like Bitcoin mining, Litecoin mining is also expensive and restricted to those with specialized powerful hardware.
Litecoin has been one of the top 10 cryptocurrencies for a long time with a market capitalization of $9.64 billion.
Litecoin had a great 2017 as its price grew from $4 in January 2017 to $350 in December 2017, giving it a return of over 8000%.
Prices of Litecoin dipped as the cryptocurrency market crashed in March 2018. Its price has been moving downwards ever since.
Stellar was founded in 2014 by Jed McCaleb who is also the founder of Ripple. In fact, Ripple was hard forked into Stellar and the Stellar Development Foundation was born. Like Ripple, Stellar is also focused on making cross-border payments more efficient.
One thing that stands out for Stellar as compared to all the other popular cryptocurrencies is that the Stellar Development Foundation is a non-profit organization. As you can see in the picture below, its mission is also in line with that.
Pros of Stellar
- Stellar is more decentralized as compared to its closest competitor, Ripple. Also, being a non-profit, it inspires more trust than others.
- Stellar has secured strategic partnerships with over 30 banks and with organizations like Deloitte and IBM.
Cons of Stellar
- There are many coins that are targeting this space of international payments, including the number 3 on our list of Top 10 cryptocurrencies — Ripple.
Stellar has been around since 2014 but it did not see much traction ‘til the end of Q1 2017. Its price grew from $0.0039 in April 2017 to $0.85 in January 2018. That’s a return of 21,694% in less than 9 months!
Stellar’s plans to bring financial inclusion to remote areas and revolutionize the payment industry has made it one of the most popular cryptocurrencies available.
Founded in 2015, IOTA is the most unique coin among other similar crypto's. It is the only one to use a new protocol invention called ‘Tangle’ rather than blockchain technology.
You have probably heard of the Internet-of-Things (IoT), a technology that enables communication between various objects with sensors, via the internet. IOTA is focussed on making this technology more secure, seamless and scalable.
Pros of IOTA
- The biggest advantage that IOTA offers over all other cryptocurrencies is zero transaction fees.
- When all other cryptocurrencies are struggling with scalability issues, IOTA’s technology promises infinite scalability.
Cons of IOTA
- IOTA is betting on the success of another industry — Internet-of-Things, making it's future even more unpredictable than the other top 10 cryptocurrencies.
- MIT Media Lab had recently discovered a security problem with Tangle.
- If the big IoT players themselves develop their own cryptocurrency then IOTA could face stiff competition
While IOTA was created in 2015, its token was launched on exchanges only in 2017. It was an immediate success as its price grew from $0.44 in June 2017 to $5.34 in December 2017, giving it a return of about 1,200%.
Like most of the other crypto's, IOTA also experienced a price dip earlier this year. It is currently experiencing a stabilization - time will tell if IOTA will manage to climb back up.
NEO, a Chinese cryptocurrency, was created in 2014 by Da Hongfei. Did you know that it was originally called AntShares? In fact, it only got rebranded to NEO in June 2017!
NEO is often referred to as the “Chinese Ethereum” because of the similarities to its competitor among the top 10 cryptocurrencies Ethereum. It also offers a blockchain-based platform for the development of Smart contracts and launching ICOs.
Pros of NEO
- NEO can complete 10,000 transactions per second compared to the 15 transactions of Ethereum.
- While Ethereum supports only one programming language, NEO supports multiple languages like C++, C#, Go, Java, making it a favorite among programmers.
- It appears to enjoy the support of the Chinese government, which gives it a clear advantage in the massive Chinese and Asian markets.
Cons of NEO
- Since it is dependent on government support, it will be the worst hit if the Chinese government comes out with unfavorable policies.
- It is targeting the most competitive segment in which there is severe competition from other cryptocurrencies in the top 10 — Ethereum, Cardano, EOS.
NEO deserved to be in the top cryptocurrency list because of the tremendous return it gave in 2017. NEO touched a high of about $162 in January 2018, a 111,400% growth from $0.16 in January 2017.
Same as IOTA, NEO is currently experiencing a period of stabilization. It's priced at $7,74 USD with a market capitalization of $5.53 billion.
So, NEO is the last one in our list of top cryptocurrencies 2018.
You now know which are the top 10 cryptocurrencies for 2020. You also know about their origin, pros, and cons.
I have also given you a brief snapshot of the past performance of all the most popular crypto's. These cryptocurrencies form more than 75% of the total cryptocurrency market by market capitalization.
This list of the most popular cryptocurrencies should help you in picking the best ones for yourself.
So, which ones are your favorite? Let us know!