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An introduction to the Top 10 cryptocurrencies

 

The Flourish Team

November 15, 2021

While there are thousands of cryptocurrencies, these 10 make up 80% of the market.

Estimated reading time: 10 minutes

 

Summary:

As the adoption of blockchain technologies continues to grow, specialized networks are frequently being developed and tailor-made for new use cases. Some protocols are designed to serve as a store of value, others function as highly efficient payment networks, and others still are designed to host decentralized applications. As the applications of blockchain technology diversify, so too do the native digital assets that enable these networks. In other words, there are a lot of cryptocurrencies out there.

Cryptocurrencies range in nature from the iconic stalwarts like bitcoin to the ecosystem-building platforms like ethereum all the way to the outright flippant projects like Dogecoin. While this emerging asset class seems to have a nearly-unlimited capacity for new and unique blockchain projects, presenting a daunting barrier to understanding the world of crypto, there is a bit of good news: the cream rises to the top.

The top 10 cryptocurrencies—a ranking that changes frequently—make up about 80% of the total cryptocurrency market cap as of November 2021. Bitcoin itself takes up 41.5% of market share, while the remainder of the top-10 list is populated by projects that have contributed strong technological innovations and are seeing growing adoption.

Keeping these considerations in mind, we’ll briefly explore the top 10 cryptocurrencies by market cap as of November 10, 2021.1

 

1. Bitcoin

  • % of Crypto Market Cap: 41.5%
  • Current Price: $68,599

Launched in 2009, bitcoin (BTC) is the world’s first cryptocurrency. It relies on blockchain technology, cryptography, and a distributed ledger mechanism to solidify itself as a provably-scarce digital asset—the source of its perceived value. A finite supply of 21 million BTC is hard-coded into the Bitcoin protocol, with nearly 19 million already mined. Pseudonymous inventor Satoshi Nakamoto pioneered the field of cryptocurrency with the introduction of Bitcoin by solving the “double spend” problem, preventing a digital asset from being spent twice.

The meteoric rise in value of BTC has resulted in its main use case of being a store of value—a type of “digital gold”—rather than a payment system. The Bitcoin network is older and slower than other newer projects, but its network is incredibly secure and has never been hacked. For these reasons, many investors buy and hold BTC for the long-term.

 

Cryptocurrency glossary

New to crypto? Dozens of key concepts and terms are defined in our Cryptocurrency glossary.

 

2. Ethereum

  • % of Crypto Market Cap: 18.4%
  • Current Price: $4,873

Ethereum was the first blockchain to support “smart contracts”—sets of rules that automatically execute when certain conditions are met. Thanks to its first-mover status, Ethereum has become the de facto standard for smart contract development, decentralized finance (DeFi), nonfungible tokens (NFTs), social tokens, and other decentralized data and computing applications. Whereas bitcoin is the most valuable cryptocurrency, Ethereum is the most used blockchain and has grown to process more transaction volume than Bitcoin.

Ethereum’s native cryptocurrency is called ether (ETH).The Enterprise Ethereum Alliance (EEA)—along with members such as JP Morgan Chase, Microsoft, and FedEx—continues to explore innovative new use cases for the Ethereum blockchain. The Ethereum community recently approved a major upgrade called EIP-1559 that effectively introduced a deflationary aspect to its supply policy in hopes of improved usability (through the “burning,” or elimination, of ETH during transactions), and is working towards a long-awaited shift from proof-of-work to proof-of-stake.

 

3. Binance Coin

  • % of Crypto Market Cap: 3.64%
  • Current Price: $650

Binance Coin (BNB) is the native utility token for Binance—the world’s largest cryptocurrency exchange. At the time of writing, Binance processed over $2.7 billion in trade volume over the last 24 hours. Binance members and traders hold about 80% of the total BNB supply, as users are incentivized to use BNB to pay platform fees in order to enjoy discounted transaction fees, faster transaction times, and other platform-specific benefits. Binance has solidified itself as a world-class cryptocurrency exchange, and its BNB token plays an integral role in the platform’s continued growth and operation.

 

4. Cardano

  • % of Crypto Market Cap: 2.54%
  • Current Price: $2.26

Cardano (ADA) was founded by one of the co-founders of Ethereum and is, similarly, a blockchain platform intended to support smart contract and decentralized application development. Though it doesn’t hold Ethereum’s coveted first-mover status, Cardano distinguishes itself as a proof-of-stake (PoS) blockchain that is faster and less energy-intensive than its proof-of-work (PoW) predecessors like Bitcoin and Ethereum. Cardano is a technology-focused project led by technophiles and mathematicians with an idealistic view of the promise of blockchain technology to change the world.

 

5. Solana

  • % of Crypto Market Cap: 12.49%
  • Current Price: $245

Solana (SOL)—like its main competitor, Ethereum—functions as a platform for building decentralized applications, particularly within decentralized finance (DeFi). Launched in 2020, Solana has quickly established itself as a viable option for app developers thanks to its fast, secure, innovative blockchain structure, which can process more transactions per second than almost any other blockchain in the world while keeping platform fees low for users. SOL is the native cryptocurrency of the Solana blockchain; at the time of writing it trades around $245 USD.

 

6 & 10. Tether and USD Coin

Tether
  • % of Crypto Market Cap: 2.48%
  • Current Price: $1

USD Coin

  • % of Crypto Market Cap: 1.16%
  • Current Price: $1

Tether (USDT) and USD Coin (USDC) are both stablecoin projects that commonly populate the top 10 cryptocurrencies by market cap. As stablecoins, Tether and USD Coin are the two most commonly used digital currencies for investors who want to rotate profits or funds from other crypto investments into stable, dollar-backed cryptocurrencies. As such, these cryptocurrencies are typically not viewed as investments, as both should theoretically always be worth exactly $1 USD.

Both USDT and USDC are pegged at a 1:1 ratio to the U.S. dollar, though in slightly different manners. USDT’s peg is achieved through a Hong Kong-based company called Tether, purportedly with a combination of cash and cash equivalents that are equal in value to the number of USDT in circulation, while USDC’s peg is achieved with a mixture of cash and Treasuries. USD Coin was founded by the payment services company Circle and the cryptocurrency exchange Coinbase.

 

7. XRP

  • % of Crypto Market Cap: 2.1%
  • Current Price: $1.33

XRP is a cryptocurrency designed to operate on the Ripple payment network—a money transfer network tailored to the global financial services industry. Ripple hopes to enable instantaneous global monetary transfers and replace legacy systems like SWIFT. Many of the world’s largest banks are already involved with the project, which has been a driving force for adoption of the XRP cryptocurrency.

In 2020, the U.S. Securities and Exchange Commission filed a complaint against Ripple Labs, Inc. alleging that the company violated U.S. securities laws by failing to register XRP as a security.

 

8. Polkadot

  • % of Crypto Market Cap: 1.71%
  • Current Price: $51

Polkadot (DOT) is a project designed to help make the landscape of individual blockchains more interoperable with one another. As it currently stands, blockchains are data silos separated from one another. Polkadot is building technological infrastructure to bridge the disparate blockchain environments using its Polkadot relay chain. And with innovative parallel processing, Polkadot hopes to one day be capable of processing one million transactions per second, achieving a degree of scalability unheard of among other blockchains. DOT is the native cryptocurrency of Polkadot.

 

9. Dogecoin

  • % of Crypto Market Cap: 1.21%
  • Current Price: $0.27

Dogecoin (DOGE) is a bit of an anomalous cryptocurrency that parodies other more serious projects. Instead of processing transactions more quickly than Bitcoin, or serving as a platform for application development like Ethereum, Dogecoin doesn’t bring any new technical advantages to the table. Yes, it is supported by a functional and secure blockchain and acts as a medium of exchange, but besides that, DOGE exists largely for entertainment and speculation purposes. While it is commonly used as a means of tipping online content creators in a form of micro-donations, it is better known as one of the most volatile cryptocurrencies, as its price is constantly pushed up and down by social media—including a 20,000% price surge from May 2020 to May 2021, quickly followed by a 70+% crash. At the time of writing, DOGE trades for about $0.27 USD.

 

Concluding thoughts

As crypto curiosity continues to pique investors’ interest, it’s helpful to have a cursory understanding of the most popular crypto projects. While there are over 13,000 cryptocurrencies according to CoinMarketCap, the top 10 make up about 80% of the entire crypto market cap, and bitcoin and ethereum alone make up more than 60% of the total—making these two cryptocurrencies a logical starting point for understanding blockchain investing. Most other cryptocurrencies play second fiddle to these well established cornerstones of the crypto space, though time will tell how the crypto market share is ultimately divided. One thing, however, is near-certain: there will be more innovation ahead.

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1 Data as of November 11, 2021. All price and market cap data sourced from https://coinmarketcap.com/