The world of cryptocurrency is constantly evolving. With over 9,000 different cryptocurrencies in existence as of 2023, it can be overwhelming for newcomers to the space to know where to begin. This article will provide a comprehensive overview of the top 20 cryptocurrencies - analyzing their key features, use cases and future outlook. Read on to learn which digital assets show the most promise heading into the new year.
A cryptocurrency is a digital or virtual asset designed to work as a medium of exchange. Cryptocurrencies leverage cryptography to secure and verify transactions, as well as to control the creation of new units. Bitcoin paved the way as the first decentralized cryptocurrency when it launched in 2009. Since then, many new cryptocurrencies have launched to improve upon Bitcoin’s limitations or target specific use cases.
This article will provide a deep dive into the current top 20 cryptocurrencies by market capitalization. For each cryptocurrency, we will analyze its key distinguishing features, target users, its future roadmap and growth potential. Whether you are looking to invest in crypto assets or simply want to understand the evolving landscape, this guide has got you covered. Let's begin!
As the first and most well-known cryptocurrency, Bitcoin naturally tops the list of the biggest digital assets. Created in 2009 by the pseudonymous Satoshi Nakamoto, Bitcoin pioneered the idea of a decentralized, peer-to-peer digital cash system.
- Decentralized payments without intermediaries
- Fixed supply of 21 million BTC
- Transactions confirmed via proof-of-work mining
Use Cases: Store of value, peer-to-peer payments, trading/investment
Despite its price volatility, Bitcoin remains the dominant store of value and investment option in crypto. With major financial institutions like Fidelity and JPMorgan buying Bitcoin, it continues to gain legitimacy.
Ethereum is a blockchain-based computing platform that enables developers to build and deploy decentralized applications (dApps). Launched in 2015, Ethereum brought programmability to the world of cryptocurrency.
- Smart contract functionality
- EVM allows dApp development
- Plans to shift to proof-of-stake consensus
Use Cases: dApps, DeFi, NFTs, Metaverse
Ethereum powers most of the hottest crypto trends from DeFi to NFTs. However, high gas fees and network congestion issues plague Ethereum. The upcoming Eth2 upgrade promises to fix these problems with expanded scaling solutions.
Tether is a stablecoin pegged to the U.S. dollar, allowing users to avoid the volatility typically associated with crypto. As the first stablecoin launched in 2014, Tether paved the way for the growth of decentralized finance.
- Pegged 1:1 to the U.S. dollar
- Operates on various blockchains
- Backed by reserves (both fiat currency and commercial paper)
Use Cases: Trading, transactions, payments
Despite controversies around its dollar reserves, Tether continues to thrive as the most-used stablecoin with over $60 billion market cap. However, rising competition from other stablecoins may threaten its dominance.
USD Coin (USDC)
Launched in 2018, USD Coin is another stablecoin pegged 1:1 to the U.S. dollar. It is designed to be fully compliant with financial regulations and transparent with its reserves.
- Backed 1:1 by cash and short-term U.S. Treasuries
- Operates on multiple blockchains
- Regulated by laws and regularly audited
Use Cases: Stable payments, lending, DeFi
With robust regulation and thorough auditing of its dollar reserves, USD Coin represents a more trusted stablecoin option. As a result, its growth has accelerated in 2022.
BNB is the native cryptocurrency of the Binance exchange ecosystem. It can be used to pay trading fees on Binance and access various other Binance services.
- Used for fees on the Binance Exchange
- Powers the Binance Smart Chain
- Limited supply of 200 million BNB
Use Cases: Trading on Binance, BNB Chain transactions
BNB will become more scarce over time as Binance burns a portion of the supply each quarter. As the top crypto exchange ecosystem continues growing globally, the utility for BNB is likely to increase.
Binance USD (BUSD)
Binance USD is a stablecoin launched by Binance in partnership with Paxos. It is approved and regulated by the New York State Department of Financial Services.
- Approved by U.S. regulators
- Backed 1:1 by U.S. dollar reserves
- Operates on Ethereum, BNB Chain and more
Use Cases: Trading stable value on Binance, hedging volatility
As a regulated stablecoin in the Binance ecosystem, BUSD provides a less risky way for traders to transact on Binance and hedge against volatility.
Ripple is the cryptocurrency of the Ripple payment network designed for fast, affordable global transactions. The Ripple company aims to build a decentralized network of financial institutions using RippleNet blockchain software.
- Used for low cost, instant cross-border payments
- Allows exchange between different fiat currencies
- Operates on RippleNet with validator nodes
Use Cases: International remittance, liquidity provision
With partnerships across the world’s major banks and financial institutions, Ripple has built substantial real-world utility. However, the company faces an ongoing SEC lawsuit alleging XRP is an unregistered security.
Cardano is a proof-of-stake blockchain focused on scalability, interoperability and sustainability. Developed by Ethereum co-founder Charles Hoskinson, Cardano aims to be the world's financial operating system by establishing decentralized finance in emerging markets.
- Peer-reviewed open source blockchain
- Proof-of-stake consensus
- Two-layer architecture for security and scalability
Use Cases: Financial services for developing nations, identity management
With a research-driven approach, Cardano has the potential to achieve secure and inclusive finance worldwide. However, critics argue that development has been too slow with no operational smart contracts yet.
Solana is a highly scalable blockchain designed to enable fast, decentralized apps and marketplaces. It combines proof-of-stake consensus with innovative technologies like proof-of-history.
- Proof-of-history provides timestamped record of transactions
- Can handle 50,000 TPS with 400ms block times
- Low fees (less than $0.01 per transaction)
Use Cases: DeFi, NFTs, DApps requiring speed and low costs
Solana experienced massive growth in 2021 due to its fast speeds and low fees. However, technical problems causing network outages have raised questions about its stability.
Polkadot is a sharded heterogenous multi-chain architecture allowing external blockchains to operate seamlessly together. It enables a network of specialized blockchains to communicate and share security and transactions.
- Heterogenous sharding improves scalability
- Parachains connect to relay chain for composability
- Substrate framework supports building custom blockchains
Use Cases: Connecting private/consortium chains, decentralized web, metaverse
Polkadot aims to be the backbone for a decentralized internet of blockchains. However, seamlessly achieving composability between all chains remains a work in progress.
Dogecoin is a peer-to-peer digital currency started as a meme-inspired joke in 2013. Despite its humorous nature, Dogecoin’s low price and abundant supply have fueled its popularity.
- Originally created as a joke representing a Shiba Inu dog
- Large circulating supply of 132 billion DOGE
- Low transaction fees and faster block time (1 minute)
Use Cases: Tipping online, microtransactions, donations
A meme-powered community rallied behind Dogecoin, driving up its price exponentially in 2021. However, critics debate Dogecoin’s fundamental value beyond marketing hype.
Polygon, previously called Matic Network, is a protocol for building Ethereum-connected blockchains. Polygon aims to solve Ethereum's high gas fees and slow transaction speeds without sacrificing security.
- Sidechains provide faster and cheaper transactions while leveraging Ethereum's security
- Supports multiple blockchain networks interacting with Ethereum
- Growing set of DeFi apps launched on Polygon
Use Cases: Scaling Ethereum DApps, blockchain interoperability, DeFi
Polygon has quickly emerged as a leading layer 2 scaling solution. But as Ethereum itself scales, Polygon may face fading demand and adoption down the road.
UNUS SED LEO (LEO)
UNUS SED LEO is a utility token designed to empower the Bitfinex trading ecosystem. LEO holders receive reduced crypto trading fees on Bitfinex and other benefits like staking rewards.
- Exchange utility and governance token for Bitfinex
- Enables reduced fees for Bitfinex traders based on LEO holdings
- Total supply limited to 1 billion LEO
Use Cases: Utility token for Bitfinex exchange ecosystem
As the native utility token for Bitfinex, LEO benefits are closely tied to the exchange's success. But scaling beyond Bitfinex faces challenges without a more diversified decentralized ecosystem.
Chainlink is a decentralized oracle network providing real-world data to power smart contracts on the blockchain. It securely connects blockchains with external data feeds, APIs and payment networks.
- Decentralized oracle nodes source external data for smart contracts
- Secure middleware to connect traditional systems to blockchain
- Vast network of partnerships across DeFi, NFTs, gaming, and more
Use Cases: Feeding reliable data to DeFi apps, NFTs, metaverse projects, etc.
Having become the go-to oracle solution, Chainlink is well-positioned to be the trust layer for Web3. However, competitors are emerging in the data feeds space.
Wrapped Bitcoin (WBTC)
Wrapped Bitcoin is an ERC-20 token backed 1:1 with Bitcoin. This allows Bitcoin holders to integrate with Ethereum's DeFi ecosystem and use Bitcoin for decentralized trades/loans.
- Backed 1:1 by Bitcoin reserves
- Enables Bitcoin to be used directly on Ethereum
- Decentralized through a network of merchants
Use Cases: Using Bitcoin for Ethereum DeFi apps
Wrapped Bitcoin unlocks the liquidity of Bitcoin for the Ethereum network. However, it faces competition from projects like RenBTC with potentially more decentralization.
"A wise person once said “The more I learn, the more I realize how much I don't know.” With the vast amount and variety of cryptocurrencies available, having a beginner's mindset full of curiosity is essential." - A Crypto Investor
Terra Classic (LUNC)
Terra Classic is a blockchain payment network targeted towards mass adoption. It formerly housed the TerraUSD stablecoin which lost its peg and crashed in May 2022.
- Algorithmic stablecoins linked to Luna token
- Focus on payments for e-commerce and real-world use
- Burn/mint Luna based on TerraUSD demand
Use Cases: Low-cost payments, DeFi
After TerraUSD's dramatic collapse, Terra Classic project forked and reconstituted as Terra (LUNA). The original chain was renamed Terra Classic and its LUNC token airdropped to LUNA holders.
Avalanche is a layer 1 blockchain delivering high speed, low fees, and eco-friendly consensus through its unique architecture. It supports smart contracts and offers compatibility with Ethereum apps.
- Three individual blockchains optimized for different use cases
- Up to 4,500 TPS and under 2 second confirmations
- Lower energy consumption through proof-of-stake consensus
Use Cases: DeFi, NFTs, digital payments
Avalanche has quickly risen as a top contender against Ethereum. However, sustaining growth long-term requires continuously enhancing developer tools and user experience.
Algorand is a permissionless proof-of-stake blockchain focused on an inclusive decentralized economy. With tech invented by MIT professor and Turing award winner Silvio Micali, it solves the blockchain trilemma: decentralization, scalability and security.
- Pure proof-of-stake consensus
- Optional layer 2 solutions for scalability
- Governance system for on-chain decisions
Use Cases: DeFi, NFTs, payments
Leveraging solid tech and partnerships, Algorand aims to be the infrastructure for the borderless economy of the future. Execution remains key to stand out from the growing crowd of layer 1 blockchains.
Cronos is an EVM-compatible sidechain built by Crypto.com. It extends Crypto.com's DeFi wallet infrastructure with interoperability and additional scaling capabilities.
- EVM-compatible sidechain to Crypto.org Chain
- Low fees and high throughput
- Integrated bridges to Ethereum and Cosmos chains
Use Cases: DeFi apps and NFT Minting for Crypto.com ecosystem
As Crypto.com's primary smart contract platform, Cronos powers core products like the DeFi Wallet and CronosSwap DEX. Adoption remains limited outside of Crypto.com users.
This guide covered 20 of the top cryptocurrencies to watch based on current market capitalization. It just scratches the surface of the evolving cryptoasset landscape with new disruptive projects launching frequently. As you go down the crypto rabbit hole, maintaining fundamentally sound security and investment practices is key in this high-risk environment. Monitor your portfolio regularly and never invest more than you can afford to lose.
The regulatory environment remains uncertain, so it's wise to consult a tax professional to ensure compliance. While the crypto markets are extremely volatile, the underlying blockchain technology shows promise to transform finance, data-sharing, supply chains and more. Blockchain's ability to establish trust in digital interactions aligns with emerging Web3 and metaverse trends.
By learning about the top projects and their differences, you now have an overview of the crypto space as it exists today. This will help guide your exploration as you decide which crypto assets align with your interests, values and risk tolerance. Remember that the crypto world moves extremely fast, so be prepared to learn, adapt and make informed decisions.