January 5, 2021 | by elpidios
Back in 2009, when Bitcoin was released to very little fanfare, it is doubtful the world was ready for what was to come.
Cryptocurrencies, or digital assets that can be used as tender and whose ownership details and transactions are stored in a secure ledger known as the blockchain, have surged during their first decade of existence, offering traders a unique and exciting market where to turn a profit.
Starting in 2016, the cryptocurrency market experienced huge growth with a market capitalization of $17.7 billion that suddenly exploded and reached the staggering figure of $566 billion in 2017. The market couldn’t withstand such rapid growth and crashed to about $129 billion a year later, only to see another surge in 2019 when it settled at $237 billion.
Despite its massive drop in value in 2018, the cryptocurrency market is here to stay and is obviously trending upwards with its market capitalization in 2020 already close to $430 billion.
The cryptocurrency market, which is now at a more mature stage, has opened up a whole new slew of opportunities for traders, who now have another playground where to open and close positions and make some extra money.
With this in mind, what are some of the top traded cryptocurrencies currently available to investors? And how have they behaved during this absurdly weird year?
Bitcoin is the grandfather of cryptocurrencies.
It first appeared, under mysterious circumstances, in 2009 and has built a solid cult-like following since. There have been plenty of bumps along the way; Bitcoin’s value during the 2018 crash plummeted from $20,000 to little more than $3,200. However, BTC has picked up steam and surpassed its pre-2018 mark by closing 2020 at almost $28,000. Talk about a comeback.
Overall, if we look at its price chart for 2020, Bitcoin has shown steady growth with a year-opening price of about $7,200 all the way through October when its price skyrocketed and reached its current all-time high level.
Pundits believe this trend will continue in 2021 as its price is expected to hit the $30 to $35 thousand range and then take off further into the price chart stratosphere.
Here’s a scary thought for you. If you had bought 100 Bitcoins at the start of 2013, your wallet would have been $1350, give or take a few dollars, short. Then a hunch (or your hoarder mom) advised you to hold onto these ethereal assets. Today, you’d be about $2.8 million richer. Boom.
If Bitcoin is Batman, then Ethereum is Robin.
Launched in 2015 as a decentralized software platform used to build SmartContracts and Distributed Applications (ĐApps), Ethereum has taken the role of second-in-command of the cryptocurrency market with ether, its own digital asset.
Historically speaking, after its price spiked at the end of 2017 to only crash alongside the rest of the cryptocurrency market in 2018, ETH has slowly moved its way back up the charts with its price closing at about $730 in 2020.
Overall, 2020 was a solid year for ETH as its price, despite some minor fluctuations, rose steadily from its starting point of around $130.
Tether, which kicked off in 2014, was one of the first cryptocurrencies or “stablecoins” to actually peg its value to an existing currency, the dollar. This was done to avoid putting extra pressure on the cryptocurrency market as money works its way through it. So $1 gets you 1 USDT.
Given this unique condition, Tether’s price fluctuates within a minute range. For instance, in 2020, its price ranged from $0.0996584 to $1.014.
Still, in 2019, Tether surpassed Bitcoin as the most widely traded cryptocurrency in the world, both in terms of daily and monthly trading volume.
Before getting into trouble with the US’s Securities & Exchange Commission (SEC), Ripple’s XRP was quite popular among traders.
Ripple, a real-time gross settlement, currency exchange and remittance platform, created XRP as a way for its financial clients to easily and quickly transfer money without having to charge significant fees or wait days for a transaction to clear.
XRP’s price in 2020 was quite volatile, particularly towards the end of the year when Ripple was slammed with a class-action lawsuit claiming the company had profited off of the public by creating an unlimited number of XRPs, selling them and setting up what amounted to a “never-ending” ICO.
As a result, XRP’s price, which hit a year high of almost $0.70 in late November, plummeted at the end of the year to approximately $0.20.
Stellar, an open source blockchain payment system used by financial institutions to facilitate transactions in the developing world, is backed by its own cryptocurrency known as Lumen.
What differentiates Lumen from other cryptocurrencies is that it does not rely on traditional cryptocurrency miners for approval and therefore transactions can occur at a much faster rate.
In 2020, Lumen experienced a slight increase in its prices, climbing from $0.045 in January to just under $0.14 by the end of the year. At one point in early December, Lumen’s price peaked at about $0.20, still a far cry from the cryptocurrency’s highest mark of about $0.9 seen in December 2017 before the market crashed.
2020 was the year of Chainlink. Cha-ching.
Founded in 2017, Chainlink is an oracle network that connects real world data and information to the blockchain, facilitating the implementation of smart or digital contracts.
In 2020, the company was recognized by the World Economic Forum as one of the most innovative tech companies in the world after seeing close to 300 projects embrace its technology to interlink blockchains to real world information such as live price feeds, election data, weather conditions and randomness mechanism for the gaming industry, among others.
As a result of all this success, Chainlink’s cryptocurrency price skyrocketed, gaining close to 600 percent over 2020. It started in January at $1.81, scaling all the way up to about $19 in August to then wrap up the year of COVID just above $11.
Last but not least, we have Litecoin, which is Bitcoin’s little, faster yet more frugal brother.
Created in 2011, Litecoin replicated Bitcoin’s codebase with the plan of issuing four times the amount of assets to be released by Bitcoin and speeding up fourfold the time it takes to create new blocks on the blockchain.
Historically speaking, Litecoin’s price’s progression followed a similar pattern to that of Bitcoin, albeit at significant lower levels. LTC’s price reached its apogee in December 2017 prior to the market crash in 2018, closing near the $300 mark, but then dropped precipitously to about $24 in September. Litecoin’s value started picking back up again in mid-2020, hitting triple digits by the first week of December and closing the year at around $125.
With all of this in mind, a few questions we have asked ourselves amidst this bullish cryptocurrency market are:
- What role did COVID-19 play in pushing these prices up?
- Did the fact many of us worked remotely or were stuck at home twiddling our thumbs lead to the creation of new crypto aficionados and an increased demand for some of these assets?
If you have any answers to these questions, make sure to share your thoughts with us in the comments section.
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*Any opinions, news, research, analyses, prices or other information contained here are provided as general market commentary and do not constitute investment advice. FXPRIMUS does not accept liability for any loss or damage, including without limitation to, any loss of proﬁt, which may arise directly or indirectly from the use of or reliance on such information.