The 5 Best Cryptocurrencies to Buy For Beginners
There is not one best cryptocurrency to buy; investing in cryptocurrency is risky, but investing in only one is way riskier.
Lots of cryptocurrencies have various use cases and promise to disrupt various industries. This is a great way to hedge your risk and increase your chances of being involved in the next outperforming cryptocurrencies.
Make sure to diversify your portfolio.
This list of the hottest cryptocurrencies to invest in for beginners includes coins that:
- Land in different categories of coins that exist
- Are some of the less volatile coins in each category
- Are relatively easy to store and trade
Which make them a right combination of coins for a beginner to start with.
Going forward, I will describe each coin, its purpose, team, liquidity, price volatility, and other metrics.
In the end, you will have a solid understanding, so you can decide for yourself which is the best cryptocurrency to buy.
Bitcoin is the most widely used cryptocurrency to date. It is often referred to as the king of cryptocurrencies, and its primary goal is to act as global, peer to peer, digital cash.
- Team: Bitcoin is the only cryptocurrency that I recommend with an anonymous founder. The creator of Bitcoin is known as Satoshi Nakamoto. There is a lot of speculation about who he or she is, but ultimately, no one knows. On the other hand, the team actively updating Bitcoin’s open-sourced codebase is ran by top cryptographers in the space, such as Adam Back.
- Liquidity: Bitcoin has the highest liquidity in the space, making it the best cryptocurrency to buy for beginners. You will have no trouble buying or selling Bitcoin – there will always be someone on the other end to match your order.
- Price Volatility: Despite its volatility, Bitcoin is known to be one of the most stable cryptocurrencies. It would require a lot of capital for someone to manipulate the price.
- Crypto Economics: Bitcoin runs on a PoW (Proof-of-Work) system, which means miners receive block rewards in Bitcoin. Initially, the block reward was 50 BTC per block, but every 210,000 blocks the reward halves. This means over time inflation decreases. Also, the supply is limited: only 21 million coins will ever be mined. As demand increases, the price should rise substantially.
Simply put, Bitcoin is still the best cryptocurrency to buy today, if not the best. I would not recommend anyone investing in cryptocurrencies without investing in Bitcoin.
Litecoin is one of the first cryptocurrencies to come after Bitcoin, and one of the hottest cryptocurrencies of the decade.
Using Bitcoin’s source-code, it is a fork of Bitcoin with some technical changes to the code, making it one of the fastest cryptocurrencies. Its mission is also to be a global, peer to peer currency.
- Team: The creator is Charlie Lee. He is an experienced computer scientist, who also works at Coinbase as the Director of Engineer. His brother is Bobby Lee, founded BTC China, a large exchange. So, Charlie is both experienced and well connected.
- Liquidity: Litecoin is very liquid. It has had high liquidity and a large market cap since its creation.
- Price Volatility: Litecoin is more reliable of a hold compared to higher risk coins with smaller market caps and communities.
- Crypto Economics: Litecoin started with a 50 LTC block reward, now it is 25 LTC. There is a limited supply of 84 million as compared to Bitcoin’s 21 million. Still, this is with a higher block reward and faster block time.
Despite its competition, Litecoin is still one of the most trusted and used cryptocurrency projects in 2020.
Ethereum was the first major project to introduce smart contracts, which allow developers to launch mobile and desktop decentralized applications (dApps) on top of the blockchain.
1,000s of tokens run on the Ethereum network, and these tokens were what spurred the initial coin offering (ICO) movement.
- Team: Ethereum is founded by Vitalik Buterin. Although he’s young, he has proved himself to be a dedicated cryptocurrency expert. Joseph Lubin is also known as a co-founder of Ethereum as well as Consensys, which is a software-production studio in NY dedicated to creating decentralized Ethereum applications.
- Liquidity: Ethereum is also highly liquid, generally ranked #2 or #3 right below Bitcoin. You will have no problems buying or selling Ethereum.
- Price Volatility: Ethereum has a loyal community and team, which means the price has a better chance of staying stable and increasing in the long run.
- Crypto Economics: There are much more Ether that can exist as opposed to Bitcoin and Litecoin. But keep in mind that Ethereum fuels the dApp ecosystem. This means millions of developers and companies may need Ether to fuel their smart contracts and launch their applications.
Ethereum is the current leader of smart contract platforms and is still one of the hottest cryptocurrencies to buy in 2020 for the innovations it brought to the world and its potential applications worldwide.
#4. Binance Coin (BNB)
Unlike Bitcoin and Litecoin which aim to be used as currencies, the Binance coin is a utility token.
This means its value comes from how useful it is (and how much demand there is for its utility) within the Binance ecosystem.
- Team: Changpen Zhao is the CEO of Binance. Given the success he and his team are achieving with Binance, it’s safe to say they have the skills and resources to make this coin a success.
- Liquidity: Binance Coin is one of the most liquid cryptocurrencies right now. It is ranked within the top 10 on Coinmarketcap, with growing volume.
- Price Volatility: It’s pretty volatile, but has consistent growth. Its price was multiplied by x3 in early 2019, during the bear market. It may continue to go up or come back down, but volatility is high.
- Crypto Economics: 200,000,000 BNB were issued via an ICO at $0.10 per coin. BNB offers trading fee discounts to users holding BNB. The first year holding BNB, users get 50% discounts, then 25% the second year, 12.5% third, 6.75% fourth, and zero the fifth or later. Binance will also use 20% of its profits each quarter to buy back BNB tokens and burn them until the amount of BNB has reduced to 100,000,000 – by half. Binance is also launching a decentralized exchange, Binance DEX which should further increase the utility of BNB.
Binance is one of the world’s fastest growing exchanges, and because Binance Coin is used to pay for transactions on the exchange, BNB is one of the fastest growing cryptocurrencies in 2020 in terms of trade volume.
If you’re looking to diversify your cryptocurrency portfolio by adding a utility token issued by a company with a solid business history and an experienced team, think Binance coin.
It’s one of the best cryptocurrencies to buy to consolidate your portfolio if you already own major coins like BTC and ETH.
#5. Basic Attention Token (BAT)
Basic Attention Token is another utility token most commonly utilized in the Brave Browser.
The BAT token is used to tip content creators or virtually anyone that you find helpful on the internet. You can tip content creators monthly, or choose to send one time payments to specific people.
Additionally, users who watch ads can get rewarded in BAT. Using smart contracts, advertisers can lock up BAT, and as their ad is viewed, their funds are released to both the Brave Browser and the end viewer.
- Liquidity: Liquidity always fluctuates, but BAT is generally well within the top 40 most traded coins according to Coinmarketcap.
- Price Volatility: Surprisingly consistent. In 2018 and 2019, the price has remained within the same region while most other coins were collapsing. This may be a good sign of healthy accumulation.
- Crypto Economics: A total of 1.5 billion tokens exist and is planned to stay this way. If demand grows, then so should the price valuation of the token.
BAT will be hot cryptocurrency in 2020. It has outperformed most other cryptocurrencies during this timeframe, and the potential of the internet browsers’ industry is enormous.
Try BRAVE, the browser by BAT which competes with Google chrome and offers more privacy and security.
All in all, I consider these 5 coins to be safe investments, with solid teams behind them, that should serve beginners well.
This makes them the best cryptocurrencies to invest in, whether you’re a beginner looking to start investing or if you want to diversify your existing portfolio with some of the top cryptocurrencies.
Let’s move on to some more advanced coins. They may generate more potential profits, but with higher risk.
The 5 Best Cryptocurrencies to Buy for Advanced Investors
You probably understand this already: there are currency-focused projects such as Bitcoin or Litecoin, platform projects such as Ethereum, and many more.
If you’ve already invested in some of the top cryptocurrencies offered on platforms like Coinbase and want to expand your portfolio, then the following 5 coins might be the best altcoins to invest in for you.
My top 5 picks for advanced investors will introduce some of their competitors, as well as one new category: privacy coins.
#1. Monero (XMR)
Monero is a privacy-focused project. The coin utilizes fancy cryptography and privacy logics to hide the participants’ identities.
It is used widely on the dark web for this reason and is the most popular privacy coin today.
- Team: Monero had a somewhat anonymous start by a user on the Bitcointalk forum. The team is known to be led by Riccardo “fluffypony” Spagni, an experienced developer and cryptocurrency expert.
- Liquidity: Monero is a highly liquid coin, always sitting at the top of Coinmarketcap. No matter how much you wish to buy or sell, the market should be large enough to fit your needs.
- Price Volatility: Due to Monero’s user base and market cap, it’s a bit more stable and less risky than smaller market cap coins – and it has proven so during the bear market of 2018/2019.
- Crypto Economics: A maximum of 18.4 million XMR coins will exist in circulation until May 2022. After that, 0.3 XMR will be put in circulation every minute forever. This is a pretty small limit, making the coins very valuable in times of demand. Much of the dark web uses Monero for its privacy features, which is continuously pushing demand up.
Despite Monero’s popularity and liquidity, XMR is more difficult to store securely than major coins like BTC and ETH or than ERC-20 tokens like BNB and BAT.
This is why I made it the best cryptocurrency to buy for advanced investors and the top cryptocurrency for those interested in privacy-focused projects.
NEO is often known as the China-based Ethereum. Founded in China, NEO is another smart contract platform, enabling developers to launch decentralized applications on the blockchain.
They are slightly more centralized than Ethereum: instead of relying on hundreds of nodes like on Ethereum, there are only a few (less than 10) that make up NEOs decision making.
- Team: The founders are Da Hongfei and Erik Zhang, who also lead a company called Onchain. They are experienced and trusted.
- Liquidity: NEO is generally sitting in the top 20 at Coinmarketcap, making for a highly liquid asset.
- Price Volatility: Due to the high liquidity to price relationship, you can bet that your investment will be safer and more stable than most other cryptocurrencies out there.
- Crypto Economics: 200 million NEO will exist. 100 million NEO were created at the genesis block, 50 million were sold to early investors, and 15 million are unlocked for funding development. This means NEO’s supply is really already distributed to users, and now demand just needs to keep rising.
Smart contract platforms are targeting a vast market. Although Ethereum is currently the worldwide leader, China is a huge market, and NEO has significant chances of leading out there. As a result, NEO is one of the best cryptocurrencies to buy if you believe in smart contract platforms and want to hedge against Ethereum.
Beam is another privacy-focused cryptocurrency making waves in the industry. Unlike Monero, which is a more traditional blockchain project, Beam uses a new blockchain protocol called Mimblewimble.
Without getting into detail, Mimblewimble is known to help significantly with scaling the blockchain and transaction speed, all while maintaining a high level of privacy and anonymity.
- Team: Alexander Zaidelson is the CEO of Beam and has vast experience with P2P technology. He co-founded Nareos (a P2P file-sharing company) and has served as an advisor to several other startups.
- Liquidity: Beam has high liquidity for its relatively low market cap size, but this is good. It means investors are active and speculation is high.
- Price Volatility: Beam has been overall consistent, with $1 or so of its average. But, since it’s relatively new, the price can shoot up or down at any time.
- Crypto Economics: Beam is a PoW cryptocurrency, much like Bitcoin or Litecoin. This means that people are investing in physical mining hardware, creating a foundation price for each coin to be created. Or in other words, a rough wholesale price to produce coins. There is a max supply of 262,800,000 BEAM that can ever exist, and you can always check the circulating supply here. The inflation depends on block rewards; This first year, the block reward is 80 coins per block, then years 2-5 it reduces to 40 coins, and lastly, year 6 will decrease the reward to 25 coins per block. After that, there will be a halving every 4 years until the 129th year. To sum it up, inflation goes down over time. If Beam’s demand increases over time, then it can make for a nice possible price increase.
With Mimblewimble, Beam should be more scalable than other privacy-focused coins. And with well-thought crypto economics, Beam may very well be the next hot cryptocurrency to buy!
Nexo has been gaining some attention recently. Nexo as a software is a wallet which allows users to borrow money using their coins as collateral.
On the other hand, users can also easily and instantly loan crypto and gain interest from lending.
Nexo also offers a free credit card for users and have a unique business model. The NEXO token is one of the first security tokens to be offered (STO) in the industry.
- Team: Kosta Kantchev is one of the leading figureheads behind Nexo. He is a co-founder of Credissimo, a leading European fintech group focused on retail lending, which is the business powering Nexo. He is a fintech veteran and early user of Bitcoin.
- Liquidity: Nexo has enough liquidity for the average trader to enter or exit positions, but large investors may struggle to load their bags.
- Price Volatility: So far, very steady. It also has organic growth which means that the price isn’t increasing or decreasing drastically.
- Crypto Economics: Currently, there are less than 600,000,000 NEXO circulating with a max supply of 1,000,000,000. Since NEXO is a security token, it is also SEC-compliant and pays dividends to holders. This is a big deal for many.
Nexo is a new cryptocurrency to invest in for investors willing to diversify their crypto assets.
Unlike the other cryptocurrencies of my top 5, it is a fully regulated token that offers dividends to its holders.
They already have a functional product – which most cryptocurrency projects out there don’t, and the founders are very experienced in the credit industry.
#5. Cardano (ADA)
Cardano, which is competing with Ethereum and NEO, is touted to be more scalable and easier for developers to use.
It aims to be more scalable by introducing two layers of technology: one responsible for tracking balances of the ledger, and the other for transferring value.
Additionally, Cardano uses two programming languages called Haskell and Plutus.
Haskell has been around since the 1980s, and is Cardano’s attempt at making it easier for developers to create decentralized applications. Plutus is the functional language built in-house by Cardano’s development team.
- Team: Charles Hoskinson is the co-founder of Cardano, and was a co-founder of Ethereum as well. He also leads IOHK, a leading research and development facility for blockchain technology. Charles is well equipped to make Cardano a successful venture.
- Liquidity: Cardano regularly has high trading volumes, so you should have no worries actively trading in this market.
- Price Volatility: Cardano has had its ups and downs. I would say it is moderately volatile.
- Crypto Economics: Cardano has a max supply of 45,000,000,000 and a current supply of ~31,000,000,000. It uses a Proof-of-Stake (PoS) consensus algorithm.
All in all, Cardano is also one of the best cryptocurrencies to buy if you are looking to hedge against Ethereum.
Are You Looking for More Great Cryptocurrencies to Buy?
You made it to the end! I hope you enjoyed my top 5 cryptocurrencies for beginners and advanced users to buy for 2020, and that you found useful the information I provided.
Combined together, this list represents the top 10 best cryptocurrencies to invest in for 2020.
If you’re looking for more great cryptocurrencies to invest in, or to find out which coin is going to be the next big cryptocurrency, here is what you can do:
1. Join crypto communities
An excellent community to explore new cryptocurrencies is the BitcoinTalk forum, specifically the altcoin threads.
You can interact with people deeply involved in this niche, explore opinions, and search for the announcement threads (“ANN”).
This forum is also helpful to discover projects early on, before they become the next big cryptocurrency.
More great communities can be found on Facebook — and one of them is our own Facebook group. Feel free to join and ask other members about their favorite cryptocurrencies.
2. Check out trustworthy crypto exchanges
The best crypto exchanges perform a significant number of checks before listing new coins for trading.
You can use these verifications as some kind of quality label to find some of the best cryptocurrencies to invest in which aren’t listed on this page.
Binance is the biggest crypto exchange and offers 100+ of the best cryptocurrencies for trading — I definitely recommend you check it out.
Remember to stay safe
Buying the best cryptocurrencies is not enough to be a successful crypto investor.
Countless promising investors saw their crypto journey end brutally because they did not pay attention to security.
If you’re serious about investing in cryptocurrencies, put some effort into reinforcing your security.
- Read the ultimate cryptocurrency investment strategy guide I wrote about the 50 mistakes cryptocurrency investors make — many of them are related to security.
- Purchase a hardware wallet (recommended if you own $500 or more worth of cryptocurrencies). Our favorite hardware wallets are the ledger nano s and ledger nano x.
I hope you enjoyed this article.
Let me know in the comments which coins you invest in, and which top cryptocurrencies you think are missing in this my top 10!
More Useful Resources:
First Published at 5 Best Cryptocurrencies to Buy to Diversify  – CryptoManiaks