Despite their high volatility compared to traditional financial instruments, Bitcoin and other top cryptocurrencies are no longer as profitable investments as they used to be. Therefore, investors prepared to take on risk are looking for cheaper cryptocurrencies, which can potentially bring truly impressive profits in the future. In this article, we'll talk about some promising cheap cryptocurrencies and try to answer the question: "What is the best cheap cryptocurrency to buy for an aggressive investor?"
What is the best cheap cryptocurrency?
There's a misconception among many novice crypto investors that a cheap cryptocurrency is one with a low price per coin. But in the crypto market, assets are divisible, so the price of one coin of a certain cryptocurrency doesn't matter for determining whether it's cheap or not. What matters is the cryptocurrency's market capitalisation. The lower a cryptocurrency's market cap is, the more room it has for growth. This also works inversely: the higher the market cap is, the more difficult it is for a coin's price to increase further.
As such, Cardano, which is priced at $1.19 at the time of writing and ranked 6th among cryptocurrencies by market cap, is an expensive cryptocurrency. On the other hand, Compound, which costs $146 and is ranked 92nd in terms of market cap, is relatively cheap.
Advantages and disadvantages of investing in cheap cryptos
Cheap cryptocurrencies have several advantages that attract investors:
- High potential profit. Due to their undervaluation, cheap cryptocurrencies can bring thousands of per cent profit to their investors.
- Investment portfolio diversification. Investment diversification is an important tool for any investor. It's even more important in the risky and uncertain crypto market.
At the same time, we shouldn't forget about the disadvantages of investing in small-cap coins:
- Low liquidity. Small market capitalisation means that there may not be enough buyers in the market, and large sell-offs lead to severe price drops.
- Vulnerability to price manipulation. A low market cap makes it easier to manipulate an asset's price.
- Fraud risk. After receiving investors' money, the developers of many cryptocurrencies abandon their projects.
Best cheap cryptocurrency to buy right now
So, what is the best cheap cryptocurrency to buy now? Short answer: no one knows for sure. More detailed one: there are many promising cheap coins, and it's impossible to predict which one will outperform its competitors and turn out to be the most profitable for its investors. We have listed several relatively cheap promising cryptocurrencies that have both room for growth and some liquidity cushion.
Stacks is a layer-1 blockchain solution designed to implement smart contracts, decentralised applications (DApps), NFTs and DeFi in the Bitcoin ecosystem. Stacks aims to extend the functionality of the first and largest cryptocurrency without the need for a hard fork or change to the original blockchain.
Designed to simplify the creation and transfer of assets, Ravencoin is true to the ideals of decentralisation that were originally put in Bitcoin. The asset tokenisation market's potential is huge, and a platform that allows almost anything of value to be tokenised has a good chance of showing significant growth as this potential is unlocked.
VeChain was originally created as a blockchain platform for supply chain management. However, since then, the developers' ambitions have only grown, and now the platform is positioning itself as a 'blockchain for businesses'. VeChain is currently the leader in its niche, and the number of its partners continues to grow.
Theta Fuel (TFUEL)
Theta is a decentralised video streaming network designed to solve the industry's inherent problems and make it more efficient and fair for all participants. The video streaming market is large, and Theta has a good chance of edging out its centralised competitors.
Chiliz is a blockchain project in the huge niche of sports and esports, created to strengthen and monetise the connection between sports fans and their favourite teams and clubs. For teams, the project opens up the possibility of obtaining new sources of income; for fans, it offers the opportunity to directly participate in teams' activities.
Audius is a decentralised audio streaming protocol designed to remove intermediaries between musicians and their audience. Authors have sole ownership of their music and can monetise it or distribute their music for free on the platform. If the platform continues to develop, it has the potential to become a competitor to Spotify.
Lucky Block (LBLOCK)
This is the newest (and probably riskiest) project on this list. Lucky Block is a crypto lottery platform on the Binance Smart Chain blockchain. Through the use of blockchain technology, Lucky Block intends to make lotteries much more transparent and fair than before. At the moment, the token is only listed on Pancake Swap. The project is at the beginning of its lifecycle and is a perfect example of a 'penny crypto'.
The crypto market is volatile and difficult to predict, so there is no guarantee that these or any other cryptocurrencies will bring profit to their investors. In addition, there are much more interesting and promising cryptocurrencies than those listed here. As such, do your research and analysis, and you're quite likely to find some little-known cryptocurrency that could potentially bring you a very good income.