5 Best Cryptocurrencies to Buy for 2019

Author: 
Michael R.
Date: 
December 11, 2018
Read time: 
8 minutes
Bitcoin
Litecoin
Ethereum

As 2018 is coming to an end, everyone is looking for the next best cryptocurrencies to buy. The reality is that there is no single best cryptocurrency to invest in; instead, the best method is to distribute your risk amongst a few projects. In this article, we will provide different factors to consider when investing in a cryptocurrency and our top 5 picks for 2019. Let’s dig in!

 

As 2018 is coming to an end, everyone is looking for the next best cryptocurrencies to buy. The reality is that there is no single best cryptocurrency to invest in; instead, the best method is to distribute your risk amongst a few projects. In this article, we will provide different factors to consider when investing in a cryptocurrency and our top 5 picks for 2019. Let’s dig in!

 

How to choose the best cryptocurrencies to buy

As mentioned, while everyone is looking for the one hot cryptocurrency that will get them their Lambo, the real winners are investing in multiple projects while following a process for choosing which projects to invest in. Different fundamentals to consider when investing in a cryptocurrency project are:

  • The Team
  • Liquidity/Trading Volume
  • Price Volatility
  • Economics

Don’t worry, we will explain each of these points individually. In the end, you will have a solid understanding so you can decide for yourself which is the best cryptocurrency to buy.
 

Team

A competent team is the first and arguably most important factor to consider before investing in any project. Considering that a majority of cryptocurrency projects have yet to complete a product, you are really investing in the team. You must believe in them. The team members should have experience in their respective roles and preferably have experience working together. If the team has successfully built projects in the past or ran profitable companies together, then it is a good indicator that they have a better chance at being successful than a new team who has never worked together. Lastly, many ideas fail. In this case, you would hope that the team can pivot to a new - yet similar - idea to preserve your investment as much as possible.

A great way of tracking tangible progress of a team is by checking their Github. Github is a public website which hosts the codebases for projects. Generally, cryptocurrency projects are open-source which means that the code is public, so anyone can find the project and track progress. For example, if you see that a team is committing new code on a daily or weekly basis and they clearly summarize what they are committing, then this is a good indicator for team commitment and hopefully, a quality product. If you notice that a team is not fixing bugs or pushing new code, then it is an indicator the team is not taking this seriously.

Best Cryptocurrencies to Buy

Liquidity

Liquidity is often associated trading volume. The higher the trading volume, the more liquid you can assume an asset is. More literally, liquidity refers to how easily you can find a seller to match your buy order or buyer to match your sell order. A highly liquid asset (in this case, a cryptocurrency) means it is very easy for you to sell the asset to a buyer. A low liquidity asset means that it is more difficult to sell that cryptocurrency. Higher liquid projects are generally more mature, reliable, and secure. When buying your first batch of cryptocurrencies, it is recommended to invest in highly liquid cryptocurrencies. These are generally the best cryptocurrencies to buy as a start. You can check trading volume and other market metrics at coinmarketcap.com.
 

Price Volatility

Volatility is financial jargon for risk. The more volatile a cryptocurrency is, then the more risk is often associated with it. In other words, it is less stable. The less volatile a cryptocurrency is, the more stable it is. A project such as Bitcoin, which is the most liquid coin is also one of the more stable coins in terms of price. This means that when you invest in a low volatility coin, the chances are that the value of your investment will not change as drastically as others, so you have less to worry about it. You can generally invest in one of these more stable assets and forget about it.
 

Crypto Economics

There are many nuances to this topic, but we will keep it brief. Different coins have different mining algorithms, which in layman’s terms means there are different inflation rates. Additionally, there are tokens that raised funds through an initial coin offering (ICO), with a fixed amount of tokens sold. Even further, some coins and tokens can be staked, which means you will receive dividend-like rewards for holding the cryptos in your wallet. Ultimately, this all relates to the basic concept of supply and demand. Given a cryptocurrency’s mining or staking rewards, there can be high or low rates of inflation. For a cryptocurrency’s price to increase, the force of demand must outweigh supply.

Source: One Minute Economics YouTube Channel 
 

If you think about this critically, you will realize that coins with high rates of inflation command higher demand than those with little or no inflation.

When assessing the next best cryptocurrency to buy you will want to consider all of the above factors. The team, trading volume, price volatility, and crypto economics all play vital roles in predicting the future success of a cryptocurrency project. You can often find these details on the project’s website or in their whitepaper. It goes without saying that you should also understand the project’s mission and goal, to understand the potential market size and use-cases. The best cryptocurrencies to buy are often targeting the largest potential market sizes. Next, let’s explore our top five picks for 2019.

 

The Best Cryptocurrencies to Buy

As we mentioned, there is not one best cryptocurrency to buy, instead, you should buy a few. We recommend starting with five. More than five can be too difficult to keep track of and it is the right amount to distribute risk. We will list what we think are the top five best cryptocurrencies to buy as 2019 begins. Let’s dive in.

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The educational barrier for literally buying and selling these coins can be quite steep and intimidating. You need to understand how to keep your coins safe, secure and private.

1. Bitcoin

Bitcoin is the first and most widely used cryptocurrency to date. It is often referred to as the king of cryptocurrencies and its main use is to act as global, peer to peer, digital cash.

  • Team: Bitcoin is the only project that we recommend investing in with an anonymous founder. The creator of Bitcoin goes by the pseudonym Satoshi Nakamoto. There are many speculations 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. This means you will have no trouble buying or selling Bitcoin - there will always be someone on the other end to match your order.

Best Cryptocurrencies to Buy

  • Price Volatility: Bitcoin is known to be one of the more stable cryptocurrencies, it would require a lot of capital to manipulate the price.
     
  • Crypto Economics: Bitcoin runs on a Proof-of-Work system, which means miners receive a reward in Bitcoin every so often. This reward is called a block reward. Originally, the block reward was 50 BTC per block, but every 210,000 blocks the reward halves. Right now, the block reward is 12.5 BTC. This means over time inflation decreases. As demand increases, the price can continue to rise substantially. Only 21 million coins will ever be mined. Simply put, many will tell you that Bitcoin is the best cryptocurrency to buy as of now.

 

2. Litecoin

Litecoin is one of the first cryptocurrencies to come after Bitcoin. Using Bitcoin’s source-code, it is a fork of Bitcoin with some changes 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, the founder of BTC China, a large cryptocurrency exchange. So, Charlie is both experienced and well connected.
     
  • Liquidity: Litecoin is one of the most liquid cryptocurrencies. At the time of this writing is ranked #7 on Coinmarketcap.
     
  • Price Volatility: Litecoin is a bit more reliable of a hold compared to higher risk coins with smaller marketcaps 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. Litecoin is one of the most trusted and used cryptocurrency projects.

 

3. Ethereum

Ethereum is the first major project to introduce smart contracts, which allow developers to launch full-blown mobile and desktop applications on top of the blockchain.

Best Cryptocurrencies to Buy

 Source: cbinsights.com

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4. Monero

Monero  is a privacy-focused project. This means they utilize fancy cryptography and privacy logics such as ring signatures to hide the participants' identities. It is also used widely on the dark web for this reason. It is regarded as on the hottest cryptocurrencies to invest in right now.

  • Team: Arguably, Monero has a rather anonymous start by a user on the Bitcointalk forum, but to keep things brief the team is known to be led by Riccardo “fluffypony” Spagni, an experienced developer and cryptocurrency expert. You can find his name with some quick Googling.
     
  • Liquidity: Monero is also a highly liquid coin, always sitting at the top of Coinmarketcap.
     
  • Price Volatility: Due to Monero’s userbase and marketcap, it’s a bit more stable and less risky than smaller marketcap coins.
     
  • Crypto Economics: A maximum of 18.4 million XMR (Monero) 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.

Best Cryptocurrencies to Buy

Source: bauer-power.net

 

5. NEO

NEO is often known as the Chinese based Ethereum. Founded in China, NEO is another smart contract ready platform, enabling developers to launch decentralized applications on the blockchain. They are a bit more centralized since they have delegated nodes that ultimately make up their network.

  • Team: The founders are Da Hongfei and Erik Zhang, who also lead a company called Onchain. They are extremely 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 the thousands of 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. For these reasons, NEO is one of the best new cryptocurrencies to invest in right now.

 

How do I get started investing?

Now that you understand the basic fundamentals to consider when deciding to invest in a cryptocurrency, it all comes down to practice. Go to coinmarketcap.com and explore the different projects. We also recommend strongly considering the five coins we listed above, they are certainly the best to start with.

Once you decide where you want to invest, it will be an entirely different headache to figure out how to actually purchase these coins. The educational barrier for literally buying and selling these coins can be quite steep and intimidating. You need to understand how to keep your coins safe, secure and private. The easiest way to get started is by checking out our start investing course - it will save you time and headache over Googling random bits of information.

Posted by Michael R.

Michael is an entrepreneur who has been deeply involved in the cryptocurrency industry since early 2014. He joined Cryptomaniaks as a cryptoanalyst, helping to create accurate and digestible content.

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