While there are literally thousands of cryptocurrencies, when it comes to the big dogs, there are really only two: Bitcoin and Ethereum. Bitcoin is the original crypto, created in 2009, and Ethereum was created as a “Bitcoin killer” in 2015. Together, the two comprise nearly two-thirds of the $1.3 trillion global crypto market capitalization, and Bitcoin only understands almost half.
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Although their prices have been volatile, both cryptocurrencies have provided exceptional long-term returns since their respective inception dates. That’s part of the reason investors have been piling into alternative cryptocurrencies, hoping to pick “the next Bitcoin or Ethereum.” But how likely is it that another crypto could gain prominence like the two market leaders?
Here are three cryptocurrencies that various experts and market analysts believe have a chance of being a contender.
Solana quickly became a favorite among traders to become “the next” Ethereum in late 2021, when its price skyrocketed to over $260. Since then, it has fallen sharply to below $40 as of June 2022. However, the broader crypto market has taken a hit in 2022, with Solana still holding a market cap of around $13.5B, good enough to classify it as the ninth. largest cryptocurrency.
One of the reasons Solana has often been touted as a cryptocurrency of the future is that it is the only major cryptocurrency blockchain to use proof of history. Proof-of-history is meant to be extremely fast compared to the proof-of-work protocol used by cryptos like Ethereum, and it also has lower fees.
Solana claims that it can process about 50,000 transactions per second, compared to 15 to 45 transactions per second that Ethereum handles. This may allow Solana to grow rapidly, one of the main requirements for a coin to catch up or even surpass the industry leaders, Bitcoin and/or Ethereum.
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These features have helped Solana gain the trust of big institutions like JPMorgan Chase and Bank of America, who once said that Solana could become the “Visa of the digital asset ecosystem.”
Solana currently runs over 400 projects in its ecosystem, including decentralized exchanges, wallets, and other defi projects. Stablecoins like Circle’s USD Coin also run on the platform. Given its low cost and scalability, the future may still be bright for Solana.
While Solana has gained popularity for being faster and cheaper than Ethereum, Cardano aims to beat the major cryptocurrencies by being a more environmentally sustainable alternative. Cardano was actually developed by one of the creators of Ethereum, Charles Hoskinson, which suggests that Ethereum may be based on older technology and principles than Cardano.
In fact, Cardano was designed as the first proof-of-stake cryptocurrency, designed to provide a faster, cheaper, and more secure blockchain.
Cardano’s approach requires more research than Ethereum’s, with every stage of its development peer-reviewed and extensively tested before implementation. Third generation crypto is also launching smart contract capabilities, which will help make Cardano more sustainable and scalable. As described by some analysts, Bitcoin is Crypto 1.0, Ethereum is Crypto 2.0, and Cardano is Crypto 3.0.
Cardano actually ranks as the sixth largest cryptocurrency, with a current market cap of around $30.5 billion. Like most other cryptos, Cardano’s price has taken a hit. After peaking at around $3.10 in September 2021, Cardano now sits at just $0.58, demonstrating the immense risk of investing in even the leading cryptocurrencies on the market.
Polkadot is the 11th largest cryptocurrency, with a current market cap of around $9.3 billion. Polkadot’s “special talent” is its interoperability, or its ability to connect multiple blockchains into a single network. As part of a single network, these many blockchains can exchange information without compromising security when leaving the network. This type of secure protocol is considered by some to be essential to the future of Web3, or the decentralized digital ecosystem.
As with Cardano and Solana, Polkadot claims to outperform Ethereum when it comes to cost and scalability. But what can set Polkadot apart from any of these other cryptocurrencies is its interoperability.
Unlike many other cryptocurrencies, many investors buy Polkadot not just to speculate on the coin itself, but to bet on the success of its underlying technology. If this trend gains momentum, it could help Polkadot price remain less volatile than other cryptocurrencies, which in turn could attract additional long-term investors.
However, Polkadot remains quite volatile, falling from a high of $55 in 2021 to its current level below $10.
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