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Top 10 cryptocurrencies to invest in 2021

Top 10 cryptocurrencies in 2021

2020 was one of the greatest challenges for the global economy and the traditional financial system. The global pandemic, lockdowns and the fear of a global recession led more and more institutional investors to choose cryptocurrencies as a possible alternative to traditional financial investments or as a hedge against the major economic threats.

So 2021 seems perfect for the continued adoption of cryptocurrencies and a massive change in the existing financial system. A broader acceptance is a crucial point so that cryptocurrencies can develop their full potential as an asset class.

Blockchain technology is widely considered to be transformative like the internet, machine learning, and electricity. There is no doubt that large institutions will eventually take them over. The question is when, not if.

In 2020, several well-known financial institutions have already recognized the potential of crypto: JP Morgan started banking services with Coinbase and Gemini; Visa and Mastercard intensify cooperation with crypto companies; PayPal launched a new service that enables users to buy, sell and hold cryptocurrencies; Fidelity launched a new Bitcoin index fund that appears to be Wall Street's newest game for high-paying institutional crypto betting.

Who will be next? The time will tell. But 2021 will definitely be an exciting year for all crypto traders.

Now that we've outlined the shining prospects of crypto in capturing the attention of the general public, let's answer the question: What cryptocurrencies to invest in in 2021?

1. Top cryptocurrencies in 2021: Bitcoin

New cryptocurrencies come and go, but Bitcoin is always up to date. In late November 2020, Bitcoin surprised everyone by hitting its new all-time high of $ 19,857. The price gain has thus increased by a full 177 percent since the beginning of the year.

Will the rally continue in 2021? Analysts unanimously share positive forecasts for the Bitcoin future within the next 12 months and beyond, predicting a staggering $ 100,000, $ 170,000 and even $ 318,000 as price targets for BTC.

The main Bitcoin price drivers in 2021 include growing institutional demand, rising inflation and the increasingly negative perception of current monetary policy. All of this forces private investors as well as institutions to look for alternative investment options in order to protect the value of their capital. Cryptocurrencies, led by Bitcoin, seem like a perfect solution.

"Quite simply, the risk / return ratio is shifting from traditional financial investments as a source of return, which are less risky and a reliable and inflation-resistant store of value, to Bitcoin and other crypto investments as a source of return, which are increasingly less risky and a reliable store of value," said Sergey Nazarov, the co-founder of Chainlink.

The expert believes Bitcoin will break the $ 100,000 mark at some point, and he is not alone. Tom Lee, the managing partner of Fundstrat Global Advisors, predicts in his BTC price forecast for 2021 that Bitcoin will replace gold as a store of value and a hedge against inflation.

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2. The King of DeFi: Ethereum

The 2021 cryptocurrency predictions cannot help but mention the most promising cryptocurrency, Ethereum, which performed great even during the challenging 2020 year.

As of December 2020, the market capitalization of the second largest cryptocurrency after Bitcoin, Ethereum, was $ 68,127 billion. At the beginning of 2020, the ETH price was quoted at $ 125 and rose to around $ 600 over the course of the year, which means an increase of 380 percent within 12 months.

Why is Ethereum considered the best cryptocurrency to invest in? Ethereum's open source blockchain network has always served as the preferred one for decentralized applications (dApps). In addition to the native cryptocurrency Ether (ETH), the platform also supports other crypto platforms such as Uniswap (UNI), Maker (MKR) and Aave (AAVE), which are active in the field of decentralized finance.

DeFi is considered to be one of the fastest growing crypto trends that can transform insurance, lending and savings programs, making them independent of banks and other centralized financial institutions.

In 2020, the fastest growing sector in the crypto world, DeFi, hit new highs. The total number of assets locked in the DeFi ecosystem exceeded $ 13 billion (2019 that figure was less than $ 3 billion).

The explosive influx of market participants and capital into the DeFi contributed to Ethereum's strong position as a leading altcoin as it dominated the sector with 96 percent of the total transaction volume.

3. Ripple: a new payment ecosystem

Ripple was created as an alternative financial payment system with the goal of transforming and facilitating cross-border payments by making them 100 percent secure, almost free and instant.

Even in the early days of Ripple in 2013, the platform was noticed by many financial institutions. Years later, it was adopted by more than 100 financial institutions. In 2020, the Ripple blockchain expanded to more than 300 providers in 40 countries, including Banco Santander (SAN) and American Express (AXP), JP Morgan (JPM) and HSBC Holdings (HSBA).

Recent RippleNet supporters include HDFC Bank Limited (HDB), India's largest bank, and Bank of America (BAC), the second largest bank in the United States.

Is Ripple Among the Top 10 Cryptocurrencies to Invest in in the New Year?

According to the OMFIF (Official Monetary and Financial Institutions Forum) report, Ripple could "position itself as an alternative to SWIFT" with its distributed ledger technology (DLT) and solve five major problems: security, speed, traceability, costs, transparency and risk management .

With growing support from the European Commission promoting the transition to digital finance and sharing plans to build a new legal framework that will enable the use of DLT technology and crypto assets in the financial sector, investing in cryptocurrency from Ripple seems more attractive than ever.

4. Litecoin: fast and cheap

Litecoin made strong gains right at the start of the year. At the time of writing, the Litecoin price is around $ 155. The cryptocurrency boasts one of the lowest mining times and a high block reward of 25 LTC.

While we can't call Litecoin the top performing cryptocurrency in 2020, it has never left the top ten cryptocurrencies and 2021 will be no exception.

The start of the first decentralized Litecoin-based RPG fantasy game LiteBringer, in which every move is a transaction, brought advantages for the entire blockchain. The news sent Litecoin transactions skyrocketing: right after the game started, the number topped 130,000.

The increase in performance could be viewed as a positive price driver. CoinSwitch analysts forecast a price target of $ 600 for Litecoin in 2021.

Some analysts also believe that the Litecoin price is more likely to grow in the coming years after halving. According to the optimistic LTC cryptocurrency forecast from Cryptoground.com, Litecoin will trade at $ 88 over a one year period and climb to $ 347 by the end of 2024.

5. TRON: Transforming the Altcoin Market

Originally launched on the Ethereum network, the TRON peer-to-peer network aimed to revolutionize the entertainment industry and democratize the creation of content. The team has numerous high-profile partnerships, including Samsung, the bike sharing company oBike, the Chinese search engine Baidu and Baofeng, the so-called Chinese Netflix.

The TRON ecosystem functions as a content sharing platform. Users who create or share content are rewarded with TRX, which serves as a more transparent monetization system compared to the systems used by traditional social media networks.

It also doesn't need a middleman like AppStore or GooglePlay.

The increase in dApps could be a big contributor to TRON's upward movement as the crypto platform is considered one of the greatest powers in this market.

In 2020, TRON's dApp transaction volume even exceeded that of Ethereum.

In summer 2020, the platform gave the go-ahead for the TRON 4.0 Great Voyage protocol upgrade. The implementation of 4.0, which includes the data protection functions for smart contracts, provides an additional reason for an optimistic TRX price forecast in 2021.

6.-10 .: In which crypto currencies invest: another five crypto market participants

If you're looking to invest in cryptocurrency, here are the next five best coins with strong potential to surge in 2021:

Conclusion: which cryptocurrencies should you invest in?

With widespread adoption of cryptocurrencies and crypto payments only a matter of time, 2021 will be a great year for the entire crypto market.

Although the lists of the top cryptocurrencies can differ, all of them offer good trading opportunities, especially when it comes to CFD trading.

Do you want to invest in crypto?

Contracts for difference could be a good alternative to buying digital coins, as CFDs can take advantage of both up and down movements in price.

Follow the latest market news and the price of your favorite cryptocurrency on our comprehensive live charts. Analyze your performance and go “long” or “short” accordingly.

More on the topic: Bitcoin price forecast 2021: clearly strong, but to what extent?

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