Penny Cryptocurrencies: A Complete Guide
The Bitcoin millionaire yacht has already sailed, but investors can find other promising and cheaper altcoins. Penny cryptocurrencies account for almost 35% of the total cryptocurrency market. A penny cryptocurrency is a digital currency that is trading under $1. Much like penny stocks, the penny cryptocurrencies are very cheap coins worth a few pennies. Their low price helps drive volatility and upward momentum.
What are Penny Cryptocurrencies?
With so many altcoins to choose from, picking out the best penny cryptocurrency to invest in can be overwhelming. It is essential to find penny cryptos that would gradually grow in terms of market capitalization. Investing in them would mean increasing one’s cryptocurrency holdings and diversifying an investment portfolio. If you want to make sure you have constant returns from your investments, you need to step up your game and diversify your cryptocurrency portfolio.
You might be naturally inclined to believe that “shitcoins” don‘t make the most lucrative trades. Bitcoin tripled its value recently, but many altcoins explode 30, 40, or 50 times over within days. Arguably the most famous is Dogecoin, which recently shot up thanks to a potent combination of Reddit and Elon Musk. After launching at around $8 in August, the obscure Meme coin briefly reached a valuation of over $1,750 in September. If, with fantastic luck, you invested $1,000 at $8 and sold at $1,750, you’d be up to $217,000. This is the allure of “shitcoins.” but there are thousands of altcoins, forming an Indiana Jones-esque Cave of Crypto Wonders.
Why Invest in Penny Cryptocurrencies?
Over the years, cryptocurrencies have garnered recognition as the best digital assets for investments. To understand why you must invest in the best penny cryptos, let’s consider the case of Bitcoin. Initially, Bitcoin had no value, but it was traded for a penny in less than a year. Over the decade, the first cryptocurrency, Bitcoin, had its fair share of ups and downs. Nevertheless, Bitcoin reached an all-time high of $50,000 on February 16, 2021. Naturally, only those investors who believed in Bitcoin’s potential as the best cryptocurrency under a penny back then are billionaires today. Altcoins offer high-risk reward ratios and investment diversification. If you want your crypto portfolio to generate constant returns, you need diversification. The cryptocurrency market crash amid the coronavirus outbreak couldn’t put to the ground every single coin. There are still coins that show positive returns.
The underlying technology of any cryptocurrency determines its true potential. For instance, it is blockchain technology for Bitcoin, Litecoin, etc.; Ethereum for Ether; cross-border payment technology for Ripple. If diversification is what you are looking for, then definitely keep an eye out for new penny cryptocurrencies, read their white papers, and fully understand their potential applications. Investing in such an altcoin while it is a shitcoin will help you stay ahead of your game.
So, how does one determine the best penny cryptocurrencies to invest in?
How to Select The Best Penny Cryptocurrencies
When looking for the best penny cryptocurrencies under 1 dollar, here’s a list of criteria to take into account:
- Make a note of important cryptocurrency market updates about constantly crashing cryptos or new cryptos supported by innovative technology.
- Perhaps, one of the most important requisites is a supply of over 10 million coins, with 25% of it being mined.
- Discount penny coins that trade near their all-time high
- Market capitalization and Liquidity are two major metrics. For penny crypto, to be worth an investment, it must have a market cap of over $20 million, and $1 million in daily trading volume with a percentage gain of higher than 50% in the past seven days (you can view these metrics on Coinmarketcap)
- The best penny cryptocurrencies under $1 are listed on prominent cryptocurrency exchanges like Binance, BitMex, OKEx, Huobi Global, MXC, etc.
- A strong presence on social media (Twitter, Facebook, Reddit, and cryptocurrency forums)
- Experienced blockchain developers team
Best Cryptocurrency Under $1 in 2021:
Where to Buy and How to Buy Penny Cryptocurrencies?
Some of the best Bitcoin exchanges also specialize in offering cryptos that can be traded under a dollar. These include Binance, Kraken, Coinbase, to name a few. Some of the best penny cryptos are XRP (Ripple), Ravencoin, Cardano, Qlink, Ren Coin, and Stellar Lumens.
It might be quite challenging to find an exchange that is both reliable and supports even the most obscure tokens since most exchanges support coins that are in high demand.
Our advice is to check out Binance and Bittrex, as they not only offer a great choice of penny cryptocurrencies but high-level security measures as well.
It’s important to lay down some sort of a selection process, so you don’t get lost with so many coins available to buy.
How to Buy Penny Cryptocurrencies?
The best penny cryptocurrencies under 1 dollar are easy to trade at most of the best cryptocurrency exchanges. Here’s how you can get started with penny crypto investments.
- Choosing a cryptocurrency exchange
- Create your account and choose a payment method
- Buy the penny crypto.
- Store the penny cryptocurrency in your crypto wallet.
There are several penny cryptos to choose from, and studying their underlying technology is essential as the true worth of the currency is determined by it. Will today’s cryptocurrencies have relevance ten years from now? While that’s still debated, one truth has emerged: its underlying blockchain technology is probably here to stay. There are many penny cryptos available for trading, and analysts agree that some of them have high-profit potential. But not all of them agree on which ones are on the verge of skyrocketing. After all, no one can predict the future. The matter of figuring out which one to invest in is where you need a strategy.
Don’t make the common beginner mistake of investing everything into one popular cryptocurrency, thinking you’re playing it safe. Traders who’ve done this end up losing everything because they underestimate the volatility of the crypto market.