Cryptocurrencies can be intimidating, especially when the term “ cryptocurrency ” is bandied about in financial and technology news headlines. What exactly is a cryptocurrency? Why do they exist? And how are they different from the paper money we use every day?
Cryptocurrency is an umbrella term for various digital currencies that all use cryptography to secure and process transactions, but there are several differences between them.
One thing that all cryptos have in common is that they’re volatile – their value can vary dramatically within a short period. And some coins are more volatile than others.
The most expensive cryptocurrencies are often called altcoins , which stand for alternative coins. These coins were created to be alternatives to bitcoin. Some have been around for a while; others have only been around for a short time.
This post will look at the eight most expensive cryptocurrencies, including where cryptocurrencies get their value and why their prices fluctuate so widely.
Where do cryptocurrencies get their value?
Some of the most valuable currencies in the world aren’t backed by any government or central bank but rather by a network of users on the internet.
Cryptocurrencies like Bitcoin, Litecoin, and Ethereum are all digital coins that exist on a decentralized network. They can be used to buy products and services, but many people buy them as investments, hoping that the value is pushed up because others want them in the future.
Cryptocurrencies get some of their value from supply and demand. The total supply of bitcoin is limited to 21 million coins. Currently, more than 19 million bitcoins have been mined, and there’s a controlled release of new coins every 10 minutes by “miners,” who are competitively verifying blocks of transactions.
The current price of a cryptocurrency is determined by the supply and demand for it at a given time . Unlike centralized currencies like dollars or euros, cryptocurrencies aren’t regulated by a central bank or other authority – instead, they’re automatically managed by an underlying network protocol.
What influences the price of cryptocurrencies?
Volatility is a key defining characteristic of the cryptocurrency market. Prices can change dramatically in a short period. Even though these fluctuations might seem unusual, they’re pretty normal. Most markets have a lot more stability than cryptocurrencies.
A large part of the reason for this volatility is that cryptocurrencies are still relatively new, and most people who are investing in them don’t know how to value them. There’s also no historical data that helps understand how their values will change.
The factors that influence cryptocurrency price are numerous and varied. Some of them can be difficult to understand and predict, but others are fairly consistent and apply even outside the crypto market.
Supply and demand is the number-one factor influencing cryptocurrency prices. This is because supply and demand directly affect how much cryptocurrency people are willing to buy or sell at any given moment.
The other main factor that influences cryptocurrency prices is public sentiment. If there’s lots of good news about a particular cryptocurrency, you’d expect it to rise in value as more people invest in it. The opposite is also true – if there’s bad news about a coin, you’d expect its price to fall as fewer people want to invest in it.
Why are some cryptocurrencies more expensive?
It’s a question that virtually every cryptocurrency investor has asked: Why is this coin so expensive?
Price is always the first thing we look at when considering investing in a coin. But why does one coin cost $ 800 and another cost $ 0.08?
The answer is that different cryptocurrencies have different supply schedules and different demand schedules. The number of coins in circulation, when they will be released, and how much people are willing to pay for them all determine their value.
The most expensive cryptocurrencies
The most expensive cryptocurrencies are the ones with the highest market capitalization.
This is because the market cap of a cryptocurrency is equal to its current price multiplied by the number of coins or tokens in circulation.
For example, if a cryptocurrency has a market cap of $ 100 million and there are 10 million coins in circulation, then each coin or token has an average price of $ 10.
1. Bitcoin (BTC) – $40,039.38 per coin
Market Cap: $760,940,212,355
Bitcoin is the world’s first and most famous cryptocurrency. The crypto was created in 2009 when Satoshi Nakamoto published the Bitcoin Whitepaper. In 2011, one BTC was worth less than a dollar. Now, it’s worth more than $ 40,000.
BTC serves as a medium of exchange and store of value for Bitcoin users worldwide. The cryptocurrency has a limited supply of 21 million coins, making it one of the hardest currencies to lose value due to inflation.
Bitcoin also has a distributed ledger called blockchain that keeps track of all BTC transactions and prevents double-spending or counterfeiting of the digital currency. Miners who use computing power to solve complex mathematical problems in exchange for BTC rewards verify all transactions on this blockchain. Moreover, the entire process is decentralized, which means no single entity controls it.
2. Ethereum (ETH) – $3,018.79 per coin
Market Cap: $363,370,374,350
Ethereum is a decentralized computing platform that introduced smart contracts to the blockchain. The creation of Ethereum was made possible by Vitalik Buterin, who worked on Bitcoin’s blockchain in 2013. In 2014, Ethereum was launched, and its token was named ether.
Ethereum has been used by many other cryptocurrencies to power their underlying technology. Ethereum remains one of the most valuable cryptocurrencies in the market today. It has maintained this position due to its ability to operate as a platform for other digital currencies. It is at the top of all altcoins, with only Bitcoin ahead of it in terms of market capitalization.
3. Ripple (XRP) – $0.715 per coin
Market Cap: $34,466,473,707
Ripple (XRP) is a San Francisco-based technology company with more than 200 employees. It’s the creator of XRP, a cryptocurrency worth around $ 0.7 per coin. Ripple also develops payment infrastructure technology called RippleNet that provides financial institutions with real-time messaging, clearing, and settlement of financial transactions.
Ripple’s XRP has a total market capitalization of $ 34 billion and trades for $ 0.7 per token – making it one of the most valuable cryptocurrencies behind bitcoin. There is currently 34,466,473,707 XRP in circulation, where it trades on more than 50 exchanges worldwide, including Binance and Poloniex.
4. Cardano (ADA) – $0.9352 per coin
Market Cap: $31,590,455,103
Cardano, a smart contract platform similar to Ethereum, is built in the Haskell programming language. ADA is the currency that runs on Cardano’s blockchain.
Cardano was founded by Charles Hoskinson, one of the cofounders of Ethereum. After disagreeing with Vitalik Buterin (Ethereum’s founder), he left and started IOHK, the company behind Cardano.
While it is not as popular as Ethereum, Cardano is still one of the top 10 cryptocurrencies currently trading at around $ 0.9 per ADA.
5. Dogecoin (DOGE) – $0.1401 per coin
Market Cap: $18,593,978,682
Dogecoin (DOGE) is a cryptocurrency created in December 2013 as a parody of Bitcoin. It features the famous Japanese Shiba Inu dog meme as its logo and mascot, and it was originally intended to be used for lighthearted jokes and tipping online users who post great content. However, despite its short lifespan, Dogecoin has gained popularity due to its low price and wide distribution.
More than 129 billion DOGE coins are currently in circulation, with a market cap of around USD 18 million. While this is still much lower than the other cryptocurrencies on our list, DOGE is relatively cheap compared to Bitcoin and other established coins, and it fluctuates less in value.
The total supply of coins is uncapped so that new Dogecoins will continue to be released into circulation indefinitely. Users can mine Dogecoins using conventional CPU or GPU systems – or they can purchase them through various exchanges or use a Dogecoin ATM.
6. Polkadot (DOT) – $17.71 per coin
Market Cap: $17,483,385,638
Polkadot is a “heterogeneous multi-chain” protocol that enables data from other blockchains to become part of its network. Polkadot is designed to connect multiple blockchain networks into one big supernetwork.
Blockchains can be public or private and don’t need to use Polkadot’s native DOT token for settlement purposes. Instead, Polkadot will handle data exchange between different blockchains in its network.
Polkadot was co-founded by Gavin Wood, one of Ethereum’s cofounders. Wood is also the founder of Web3 Foundation and Parity Technologies.
7. Uniswap (UNI) – $9.42 per coin
Market Cap: $6,493,979,919
This token was only launched in September 2020, meaning it’s barely two years old and is already trading at $9.42 per coin.
Uniswap is a decentralized exchange and liquidity protocol that enables trading on Ethereum (ETH) and other blockchains.
The UNI price started around $3 when it listed and quickly climbed to a high of more than $8 on its first day before pulling back to under $4 by mid-October.
There was then a long period during which it traded within a tight range between $3 and $4 before breaking out in February 2021, surging to an all-time high of $43.45 before falling back to the current level.
Uniswap is a decentralized exchange (DEX) protocol based on Ethereum that lets people buy and sell tokens without an intermediary. It has become a popular DEXs, with tens of billions of dollars worth of tokens traded every month.
8. Wrapped Bitcoin – $40,069.58 per coin
Market Cap: $11,095,466,353
Wrapped Bitcoin, or WBTC, is an ERC-20 token backed 1:1 by Bitcoin. In much the same way as Tether, WBTC was created to allow users to transact in BTC on the Ethereum blockchain.
Heading back to September 2020, Wrapped Bitcoin had a price of just $4,300. However, the coin has seen its value skyrocket in recent weeks and months. After reaching December highs of over $25,000 per coin, WBTC has since increased in value and is now trading for over $40,000 per token.
This makes it one of the most expensive cryptocurrencies globally – at least if you’re looking at individual coins and not counting fractions of tokens like Bitcoin.
Conclusion on most expensive cryptocurrencies
We hope we’ve shown you some of the most expensive cryptocurrencies. Some of these cryptos have utility aside from being a store of value and offerrs some pretty cool features.
We want to remind you that investing in cryptocurrencies is a risky business. It’s easy to forget that digital currencies are non-government currencies outside standard markets and exchanges. You can lose your money as easily as you can make a good profit. So, proceed with caution, and remember that you should never invest more than you could afford to lose.