Top 10 Cryptocurrencies In January 2024 Forbes Advisor UK – Forbes

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Forbes Advisor has provided this content for educational reasons only and not to help you decide whether or not to invest in cryptocurrency. Should you decide to invest in cryptocurrency or in any other investment, you should always obtain appropriate financial advice and only invest what you can afford to lose.

From Bitcoin and Ethereum to Dogecoin and Tether, there are thousands of different cryptocurrencies, making it overwhelming for those first considering getting started in the high-risk world of crypto.

These are our pick of some of the top cryptocurrencies based on their market capitalisation the total value of all the coins currently in circulation.

A cryptocurrency is a high-risk digital asset that can circulate without the centralised authority of a bank or government.To date, there are over 26,000 cryptocurrency projects out there that represent the entire 917 billion crypto market.

Created in 2009 by Satoshi Nakamoto, Bitcoin (BTC) is the original cryptocurrency. As with most cryptocurrencies, BTC runs on a blockchain, or a ledger logging transactions distributed across a network of thousands of computers. Because additions to the distributed ledgers must be verified by solving a cryptographic puzzle, a process called proof of work, Bitcoin is intended to be kept secure and safe from fraudsters.

Bitcoins price has both skyrocketed and plummeted over its lifetime. In May 2016, the price of a single Bitcoin was worth about 370. In November 2021 one Bitcoin cost 48,005 while, as of 2 January 2024, the figure is around 35,900. This demonstrates its volatility.

Both a cryptocurrency and a blockchain platform, Ethereum is a favourite of some programme developers because of its potential applications, like so-called smart contracts that automatically execute when conditions are met and non-fungible tokens (NFTs).

Ethereums price has also experienced tremendous fluctuations in value.

From April 2016 to the 2 January 2024, its price went from about 8 to around 1,895. At its peak in November 2021, its value was 3,400, which demonstrates its volatility.

Unlike some other forms of cryptocurrency, Tether (USDT) is a stablecoin, meaning its pegged to fiat currencies like US dollars and the Euro and hypothetically keeps a value equal to one of those denominations.

In theory, this means Tethers value is supposed to be more consistent than other cryptocurrencies, and its preferred by some investors who are wary of the extreme volatility of other coins. However, it has fallen below its $1 peg in the past.

Developed to help power decentralised finance (DeFi) uses, decentralised apps (DApps) and smart contracts, Solana runs on a unique hybrid proof-of-stake and proof-of-history mechanisms intended to process transactions quickly and securely. SOL, Solanas native token, powers the platform.

When it launched in 2020, SOLs price started at 0.57. It peaked at the end of October 2021 at approximately 191. Then in January 2024 its price was around 91, which demonstrates its volatility.

Binance Coin is a form of cryptocurrency. At its launch in 2017 it was priced under 10p. It peaked at around 484 in July 2017 and, as of 2 January 2024, its value was at 250, which demonstrates its volatility.

Created by some of the same founders asRipple, a digital technology and payment processing company, XRP can be used on that network to facilitate exchanges of different currency types.

At the beginning of 2017, the price of XRP was 0.004. At the end of April 2021, the price had peaked at approximately 1.19 and, as of 2 January 2024, it value stood at 0.50, which demonstrates its volatility.

Like Tether, USD Coin (USDC) is a stablecoin, meaning its theoretically pegged to the currency of the US dollar and aims for a 1 USD to 1 USDC ratio. USDC is powered by Ethereum, and can be used to complete global transactions.

Somewhat later to the crypto scene, Cardano (ADA) is notable for its early embrace of proof-of-stake validation. This method is designed to expedite transaction time and decrease energy usage and environmental impact by aiming to remove the competitive, problem-solving aspect of transaction verification in platforms like Bitcoin.

Cardano also works like Ethereum to enable smart contracts and decentralised applications, which ADA, its native coin, powers.

In 2017, Cardanos ADA tokens price was about 0.015. Cardanos price peaked as of August 2021 at the approximate price of 2.06. As of 2 January 2024, its price was at 0.50, which demonstrates its volatility.

Avalanche (AVAX) is a relatively new cryptocurrency. Despite only having sprung up in 2020, it has gained tremendous popularity as an alternative for Ethereum developers. Avalanche has become one of the larger cryptocurrencies, with a market cap around 5.38 Billion.

AVAX has a market cap of 11 billion and currently trades at 33.77.

Dogecoin was famously started as a joke in 2013 but rapidly evolved into a prominent cryptocurrency thanks to a dedicated community and creative memes. Unlike many other cryptos, there is no limit on the number of Dogecoins that can be created, which leaves the currency susceptible to devaluation as supply increases.

Dogecoins price in 2017 was 0.00016. It peaked in May 2021 at approximately 0.455. Then by January 2024 its price was at 0.07, which demonstrates its volatility.

*Market caps and pricing sourced from CoinMarketCap, current as of 2 January 2024.

Cryptocurrency is unregulated in the UK. The UK regulator, the Financial Conduct Authority, has repeatedly warned investors that they risk losing all their money if they buy cryptocurrency, with no possibility of compensation.

Cryptocurrency is a form of currency that exists solely in digital form, and is a high risk investment. Cryptocurrency can be used to pay for some onine purchases, or it can be held as an investment.

While its possible toinvest in cryptocurrencies, they differ a great deal from traditional investments, such as stocks and shares.

When an investor buys stock, they are buying a share of ownership of a company, which means theyre entitled to do things like vote on the direction of the company. If that company goes bankrupt, they may also receive some payment once its creditors have been paid from its liquidated assets.

Buying cryptocurrency doesnt grant investors ownership over anything except the token itself; its more like exchanging one form of currency for another. If the crypto loses its value, the cryptocurrencys owner suffers accordingly from the price drop.

There are several other key differences to keep in mind:

Tax treatment depends on individual circumstances and may be subject to future change.

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of tax advice.

Its important to pay attention to tax rules as they potentially apply to cryptocurrency.

Cryptocurrency is treated as a capital asset, like stocks, rather than cash. That means ifcryptocurrency is sold at a profit, the profits are subject to capital gains taxes.

This is the case even if crypto is used to pay for a purchase. If investors receive a greater value for it than they paid, then they may owe taxes on the difference, subject to the usual tax allowances.

Given the thousands of cryptocurrencies in existence (and the high volatility associated with most of them), investors have the option of taking a diversified approach to investing in crypto to potentially minimise the risk of losing more money.

Cryptocurrency ETFs started to make an appearance at the end of 2021.

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Top 10 Cryptocurrencies In January 2024 Forbes Advisor UK - Forbes