Top 10 Cryptocurrencies Of January 2024

Navigating the vast array of cryptocurrencies, from Bitcoin and Ethereum to Dogecoin and Tether, can be overwhelming for newcomers. To provide clarity, here is a list of the top 10 cryptocurrencies ranked by their market capitalization, representing the total value of all coins currently in circulation.

Bitcoin (BTC)

Market capitalization: $839.6 billion

Established in 2009 by an entity known as Satoshi Nakamoto, Bitcoin (BTC) stands as the pioneer in the realm of cryptocurrencies. Similar to most digital currencies, BTC operates on a blockchain, a decentralized ledger that records transactions across a network of numerous computers. The security of Bitcoin is maintained through a process called proof of work, wherein the addition of transactions to the distributed ledger necessitates solving cryptographic puzzles, ensuring protection against fraudulent activities.

Bitcoin’s prominence has surged, making it a widely recognized term. In May 2016, acquiring one Bitcoin cost approximately $500. Fast forward to January 16, 2024, and the price of a single Bitcoin had soared to around $42,834, reflecting an astounding growth of 8,467%.

Ethereum (ETH)

Market capitalization: $303.8 billion

Ethereum functions both as a cryptocurrency and a blockchain platform, making it particularly popular among software developers. Its appeal lies in its versatile applications, such as “smart contracts” that autonomously execute based on predefined conditions and non-fungible tokens (NFTs).

Similar to Bitcoin, Ethereum has witnessed remarkable growth. Between April 2016 and the conclusion of January 2024, its value surged from approximately $11 to about $2,528, marking an impressive increase of 22,881%.

Tether (USDT)

Market capitalization: $95.1 billion

In contrast to certain other types of cryptocurrencies, Tether (USDT) operates as a stablecoin, indicating that it is supported by fiat currencies such as U.S. dollars and the Euro. Theoretically, Tether is designed to maintain a value equivalent to one of these denominations, aiming for a more stable valuation compared to other cryptocurrencies. This characteristic makes Tether a preferred choice for investors who are cautious about the high volatility associated with other digital coins.

Binance Coin (BNB)

Market capitalization: $48.1 billion

Binance Coin (BNB) is a type of cryptocurrency utilized for trading and transaction fees on Binance, a prominent global cryptocurrency exchange. Originally introduced in 2017 with the primary function of facilitating trades on the Binance platform, BNB has since evolved to serve various purposes, including trading, payment processing, and even booking travel services. Furthermore, it is exchangeable for other cryptocurrencies like Ethereum or Bitcoin.

In 2017, the price of BNB stood at just $0.10. As of late January 2024, its value had surged to around $317, representing an impressive gain of 316,715%.

Solana (SOL)

Market capitalization: $41.6 billion

Designed to support decentralized finance (DeFi) applications, decentralized apps (DApps), and smart contracts, Solana operates on a distinctive combination of proof-of-stake and proof-of-history mechanisms to facilitate rapid and secure transaction processing. The native token of Solana, SOL, serves as the driving force behind the platform.

Upon its launch in 2020, SOL’s initial price was $0.77. As of late January 2024, it had surged to approximately $96.20, reflecting an impressive gain of 12,394%.

XRP (XRP)

Market capitalization: $31.2 billion

Developed by a team that includes founders of Ripple, a company specializing in digital technology and payment processing, XRP is employed within the Ripple network to enable the exchange of various currency types, spanning fiat currencies and other prominent cryptocurrencies.

In the early months of 2017, XRP’s price stood at $0.006. By January 16, 2024, its value had climbed to $0.57, representing a substantial increase of 9,471%.

U.S. Dollar Coin (USDC)

Market capitalization: $25.5 billion

Similar to Tether, USD Coin (USDC) operates as a stablecoin, backed by U.S. dollars with the goal of maintaining a 1 USD to 1 USDC ratio. USDC functions on the Ethereum platform, enabling users to conduct international transactions using the stablecoin.

Cardano (ADA)

Market capitalization: $19.0 billion

Entering the cryptocurrency scene later than some, Cardano (ADA) stands out for its early adoption of proof-of-stake validation. This approach accelerates transaction processing time while reducing energy consumption and environmental impact by eliminating the competitive problem-solving aspect found in platforms like Bitcoin. Similar to Ethereum, Cardano facilitates smart contracts and decentralized applications, with its native coin, ADA, serving as the driving force.

In terms of value growth, Cardano’s ADA token has shown relatively moderate performance compared to other major cryptocurrencies. Priced at $0.02 in 2017, ADA’s value had risen to $0.54 as of January 16, 2024, marking an increase of 2,585%.

Avalanche (AVAX)

Market capitalization: $13.0 billion

Avalanche stands out for two key attributes: rapid transaction speeds and minimal transaction fees. AVAX also boasts a robust Total Value Locked (TVL), representing the sum of funds deposited in decentralized finance. Total Value Locked is an indicator of a protocol’s popularity and the adoption rate of a specific cryptocurrency, encompassing activities like staking, lending, or participation in liquidity pools.

A high TVL reflects the widespread use of a protocol and the acceptance of a particular cryptocurrency. As of now, Avalanche’s price is $35.

Dogecoin (DOGE)

Market capitalization: $11.5 billion

Originally conceived as a joke in 2013, Dogecoin swiftly transformed into a notable cryptocurrency, propelled by a dedicated community and imaginative memes. Diverging from many other cryptocurrencies, Dogecoin has no capped limit on its creation, leaving the currency vulnerable to devaluation as the supply expands.

In 2017, the price of Dogecoin stood at $0.0002. Come January 2024, its value had surged to $0.08, marking an impressive increase of 40,344%.

(*Market caps and pricing details are sourced from coinmarketcap.com and are current as of 2:31 p.m. UTC on Jan. 16, 2024.)

What Are Cryptocurrencies?

Cryptocurrencies are a digital form of currency, enabling online purchases without the need for intermediaries like banks. Additionally, cryptocurrencies can serve as investments.

How Does Cryptocurrency Work?

Cryptocurrencies, predominantly based on blockchain technology, operate as digital currencies with decentralized transactions. Blockchain ensures a “trustless” environment, eliminating the need for a centralized authority overseeing transactions. Bitcoin, created by the pseudonymous Satoshi Nakamoto in 2009, is the world’s first cryptocurrency.

Why Are There So Many Cryptocurrencies?

The cryptocurrency landscape is vast, with over 22,000 projects as of June 2023. While some cryptocurrencies function as traditional currencies, others play a role in developing infrastructure. Platforms like Ethereum and Solana enable the creation of additional cryptocurrencies, expanding the possibilities within the crypto space.

How To Invest in Cryptocurrency?

Investing in cryptocurrencies involves purchasing them through crypto exchanges such as Coinbase, Kraken, or Gemini. Some brokerages, like WeBull and Robinhood, also offer options for buying cryptocurrencies.

How To Report Crypto on Taxes

Cryptocurrency is considered a capital asset, similar to stocks. Selling cryptocurrency at a profit incurs capital gains taxes, regardless of whether the proceeds are used for purchases. It’s crucial to adhere to cryptocurrency tax rules when engaging in buying and selling activities.