Key points
- Bitcoin was the original cryptocurrency that launched in January 2009.
- Countless coins are traded on the crypto market.
- Most cryptocurrencies hold small market capitalizations.
The cryptocurrency market is known for its volatility and unpredictability. But it has also generated incredible gains for long-term investors. Crypto bulls believe the sky’s the limit for crypto prices.
Though thousands of cryptocurrencies are available today, bitcoin and ethereum still dominate the crypto world. Their market capitalizations comprise about 70% of the $2.51 trillion global crypto market.
Here’s a list of the 10 largest cryptocurrencies by market cap, excluding stablecoins.
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1. Bitcoin (BTC)
Price: $67,366.89
Market cap: $1.3 trillion
Year-over-year return: 156%
Since its inception in 2009, bitcoin has become the most popular and valuable cryptocurrency. It was created by an individual, or perhaps a group, operating under the pseudonym Satoshi Nakamoto.
Bitcoin’s blockchain-based, decentralized transaction verification and public ledger system revolutionized the world of digital security. But critics have raised environmental concerns about the energy-intensive, proof-of-work consensus mechanism. They also argue that bitcoin needs help scaling its current form. Plus, other cryptos have faster transaction speeds. These quicker speeds make their blockchains more functional than bitcoin’s. That said, bitcoin still dominates the crypto market, representing 52.77%.
2. Ethereum (ETH)
Price: $3,702.66
Market cap: $444.8 billion
Year-over-year return: 107%
Ethereum was one of the first altcoins. An altcoin is an alternative to bitcoin. The leading altcoin debuted in 2015 and ranks second to bitcoin in market capitalization.
What sets the ethereum blockchain apart is its introduction of smart contracts. These contracts are pieces of code that run decentralized applications. The ethereum blockchain now supports over 4,400 dApps and developer tools.
The native cryptocurrency of the ethereum network is ether. In 2023, ethereum transitioned from a proof-of-work consensus mechanism to a less energy-intensive, proof-of-stake transaction system. Ethereum is now a greener investment than bitcoin.
3. BNB (BNB)
Price: $595.81
Market cap: $87.9 billion
Year-over-year return: 95%
BNB is a cryptocurrency issued by Binance, one of the largest cryptocurrency exchanges. It was created as a utility token built on the ethereum network. Users can use it to access discounted trading fees on the Binance.US cryptocurrency exchange.
The token has since transitioned to Binance’s blockchain. BNB can now be used for a wide range of transactions, applications and other purposes. Unfortunately, Binance’s U.S. market share took a hit in 2023 after the U.S. Securities and Exchange Commission sued the exchange for allegedly violating securities laws.
4. Solana (SOL)
Price: $166.62
Market cap: $74.9 billion
Year-over-year return: 758%
Solana launched in March 2020. Like ethereum, its network supports dApps, smart contracts and nonfungible tokens. But solana’s unique, hybrid proof-of-stake and proof-of-history verification system makes it faster and cheaper than ethereum.
Unfortunately, outages have plagued the network since it launched, undermining solana’s credibility. In fact, it has suffered several major and partial outages since early 2022. Solana supporters see the crypto as a potential long-term threat to the ethereum network. But solana’s stability must improve if it wants to live up to its hype as an “ethereum killer.”
5. XRP (XRP)
Price: $0.53
Market cap: $29.2 billion
Year-over-year return: 17%
Created by Ripple Labs, this global payments network is designed to be an alternative to the Society for Worldwide Interbank Financial Telecommunications. SWIFT is the global system banks and other financial institutions use to transfer money.
Ripple Labs claims its technology is faster, cheaper and more transparent than SWIFT. XRP is the native cryptocurrency designed for the Ripple network and XRP Ledger blockchain. In 2023, a judge ruled that the crypto is “not necessarily a security” in certain circumstances. But the SEC seeks to levy a nearly $2 billion penalty against Ripple for allegedly selling XRP to institutional investors.
6. Dogecoin (DOGE)
Price: $0.16
Market cap: $23.5 billion
Year-over-year return: 131%
Dogecoin was created in 2013 as a parody of bitcoin. But the cryptocurrency has become a legitimate investment for many crypto traders because of its simplicity. It also has high-profile supporters and a popular dog mascot.
Tesla CEO Elon Musk, a dogecoin investor, has repeatedly triggered volatility in the share price by mentioning the crypto. A group of dogecoin investors sued Musk for allegedly illegally manipulating its price. Billionaire entrepreneur Mark Cuban is also a dogecoin supporter and has praised the crypto for its potential as a medium of exchange.
7. Toncoin (TON)
Price: $6.17
Market cap: $21.4 billion
Year-over-year return: 214%
Toncoin is a “layer 1” token developed in 2018 by encrypted messaging company Telegram. The toncoin network is known for its smart contract capability. It also has an advantage over ethereum with its impressive blockchain transaction speed of five seconds.
Toncoin’s speed makes it extremely useful. But its long-term success hinges on the network attracting more developers and growing its user base. Toncoin’s price and visibility got a boost from reports of Telegram considering an initial public offering. A successful Telegram IPO likely wouldn’t impact TON demand. But it could draw media attention to the crypto.
8. Cardano (ADA)
Price: $0.46
Market cap: $16.5 billion
Year-over-year return: 29%
Cardano is a decentralized proof-of-stake blockchain that debuted in September 2017. The crypto is designed to be more energy-efficient than bitcoin and other proof-of-work blockchains. From the start, cardano’s founder, Charles Hoskinson, co-founder of ethereum, boosted its credibility.
Like ethereum, cardano is focused on functionality, appealing to developers building dApps and verifiable smart contracts. ADA is the primary cryptocurrency used on the network to run dApps and facilitate transactions. By staking cardano, users can help verify the network’s transactions. They then earn additional tokens as a reward for participating in the proof-of-stake system.
9. Avalanche (AVAX)
Price: $37.79
Market cap: $14.8 billion
Year-over-year return: 166%
The avalanche mainnet went live in September 2020. Avalanche is a competitor to the ethereum network. Its goal is to establish itself as the fastest, most secure blockchain. The avalanche smart contract platform supports dApps and autonomous blockchains. Users can vote on governance issues and pay transaction fees with avalanche’s native AVAX token.
AVAX’s circulation is capped at 720 million tokens. But avalanche users control the token creation rate. This allows them to increase or decrease the inflation rate. Avalanche also has a unique consensus mechanism. A transaction is finalized only when a sufficient majority of validators approve it.
10. Shiba Inu (SHIB)
Price: $0.00002
Market cap: $14.2 billion
Year-over-year return: 186%
Anonymous founder Ryoshi launched SHIB in 2020 on the ethereum blockchain. Initially dubbed the “dogecoin killer,” it represented a rival dog-themed meme coin.
SHIB has quickly escalated to the top 20 largest cryptos by market cap. While it’s similar to DOGE, there are key differences. For instance, SHIB is built on the ethereum network. This allows SHIB to handle smart contracts and dApps. There’s also a unique community of SHIB followers, known as the SHIBArmy. It helps lead the crypto project’s future development.
*Market caps and pricing sourced from CoinMarketCap.com, current as of 8:07 a.m. ET on May 24, 2024.
What is cryptocurrency?
Cryptocurrency is a digital asset investors can buy and trade on crypto exchanges. While thousands of cryptocurrencies have unique aspects, many share common traits.
Cryptocurrencies are typically considered alternatives to fiat currencies like the U.S. dollar. A government or central bank normally backs fiat currencies. Most cryptos are decentralized. This means they don’t have government backing and users don’t need a bank to complete transactions.
Crypto transactions are typically secured via a blockchain-based consensus mechanism. Cryptos leverage the power of distributed peer-to-peer computer networks. Their speed and security stem from their unique software protocols.
What is crypto trading?
Crypto trading involves buying and selling cryptocurrencies to generate profits from the transactions. There are several strategies for crypto trading:
- Long-term traders buy and hold crypto, hoping its popularity and price will trend higher over the years or decades.
- Crypto swing traders attempt to capitalize on market trends and momentum by buying and selling cryptocurrencies over a period of days or weeks.
- Crypto day traders aim to buy and sell within a single-day period.
- Crypto scalp traders attempt to buy and sell cryptos throughout the day to accumulate many minimal gains.
Pros and cons of crypto trading
To be a good crypto trader, you must treat the endeavor as your primary job.
“Because the crypto market is so volatile, the rewards from trading can be immense — but so too are the risks,” said Christian Quiver, CEO of League.Tech.
Crypto trading has risks and challenges you should understand before placing an order.
Here are several pros and cons of crypto trading:
Pros
- Most top cryptos have solid long-term performance.
- Supply restrictions limit dilution.
- Demand for cryptocurrencies could grow significantly as institutional investment increases.
Cons
- The crypto market has a record of extreme volatility and unpredictability.
- Crypto may face growing regulatory scrutiny, including potential government bans.
- Crypto doesn’t represent ownership in tangible goods or revenue-generating companies.
How to buy cryptocurrency
Cryptocurrencies trade on exchanges like stocks and exchange-traded funds. But not all online brokerages allow cryptocurrency trading, particularly in cryptos other than bitcoin and ethereum.
The first step in buying cryptocurrency is identifying a broker or exchange offering crypto trading. Popular crypto brokers include Robinhood and SoFi. Leading cryptocurrency exchanges include Coinbase and Binance.
Steps to opening a cryptocurrency exchange account
Once you find a cryptocurrency exchange, you can create and verify a trading account. The process may vary from platform to platform. But it will generally include the following steps:
- Create your account. This process may involve choosing the appropriate account type and submitting personal information.
- Confirm your identity. You may be required to submit a copy of a photo ID, a bank statement or other documents.
- Read and agree to a user agreement. These agreements usually spell out the rules associated with your account, including fees or penalties.
- Link a payment method. You must choose a bank account or other account type to link to your crypto trading account. This will allow you to transfer money in and out of the account.
- Fund your account. Decide how much money you’d like to start trading with and transfer it into your crypto trading account.
Frequently asked questions (FAQs)
Why are there so many cryptocurrencies?
Cryptocurrencies have various goals and characteristics, such as different functionality, rewards, or consensus mechanisms. There’s also a low barrier to entry to creating a new crypto, which is why you see new currencies pop up all the time.
Are cryptocurrencies a good investment?
Bitcoin, ethereum and other top cryptos have historically been good investments over the long term. But cryptocurrency doesn’t yet have a proven track record as an investment over several decades. It’s extremely volatile, so check to see if investing in crypto fits your risk profile.
What are the top cryptocurrencies by market cap?
The top cryptocurrencies by market cap are bitcoin and ethereum. They have long been entrenched among cryptocurrencies as No. 1 and No. 2. After that, a collection of cryptocurrencies jostle for position, including BNB, solana, XRP and dogecoin.
