2021 is already here and we need to talk about the top 3 cryptocurrencies to follow this year. As we know, each year there are different digital assets that start moving higher for one reason or another. This is why it is certainly important to have a clear strategy on how to buy digital assets and build our diversified portfolio.
Disclaimer: this post should not be considered investment advice. This is only for educational purposes only. Never invest more than what you are able to lose and always ask for information to your professional financial advisors. We are not financial advisors.
Take into consideration that not all the virtual currencies are going to be experiencing similar patterns. Moreover, some of them may grow more than others. However, this guide is merely for educational purposes. We will go through some cryptocurrencies that could reach new highs in 2021.
Yearn.Finance (YFI) became one of the largest and most popular Decentralized Finance (DeFi) platforms in the market. Throughout the last months, YFI showed to be a fast-growing industry inside the cryptocurrency space that is offering users with a wide range of solutions.
YFI was able to reach its highest point in 2020 when it surpassed $41,000 for a short period of time. Now that Bitcoin has broken all-time highs, if the bull run continues, YFI could become a leader in the market. Although we cannot predict how far its price can go, it is certainly possible for it to become one of the best performing coins in 2021.
The strong point of this virtual currency is its relatively small supply. There are only 30,000 YFI available in the market. This makes this cryptocurrency very scarce compared to others. This is why its price is currently close to $28,000.
You can check our guide for Universal Market Access (UMA).
Litecoin (LTC) is an old but innovative virtual currency in the market. This digital asset has been operating since 2011 and it is now working so as to be the largest cryptocurrency in the world in terms of privacy solutions.
The team behind Litecoin is working in order to implement the MimbleWimble solution. This would make LTC fungible and help users protect their privacy while receiving and sending LTC. This could increase LTC’s demand due to having a new use case.
Users would not have to move to Monero (XMR) or other privacy-focused digital assets if they want to have enhanced privacy. Everything can be done through one of the most liquid and accepted cryptocurrencies all over the world.
It is usually known that Litecoin is the testnet for Bitcoin. This could be very positive for the digital asset. New implementations can be tested on top of Litecoin and lately be introduced on Bitcoin. If you think this could have a positive impact on Liteocin, then, it would make of it one of the top 3 cryptocurrencies to follow.
Moreover, when compared to Bitcoin, we see that Litecoin is still at one of the lowest points in history. In USD terms, we see LTC is also far from its all-time high. This could be a great opportunity to enter the market and enjoy the gains this coin could have if it enters a new bull market.
Finally, the second-largest cryptocurrency in the world is also in our radar. Why? Simply because there is a large community working behind it to make it one of the best virtual currencies and blockchain networks in the world.
This can be seen with the recent launch of staking on Ethereum and its new Proof of Stake (PoS) network. By allowing users to be rewarded for their participation on the network, it will be possible to make the network faster and also secure.
While Bitcoin consumes a large amount of energy to make it secure, Ethereum could now become power-efficient and offer high transaction speeds and low fees to users. Moreover, ti might be possible for Ethereum to increase its performance.
Another thing to take into consideration is the Decentralized Finance (DeFi) market. As we see, both YFI and Ethereum are influenced by it. This is because most of the decentralized finance platforms released are based on top of Ethereum.
This gives Ethereum a privileged position in the market that other blockchain networks do not have. Having Ethereum in our portfolio could be a good way to diversify our risk. Moreover, the expansion of the DeFi market could provide us with a great opportunity to make some profits with it.
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