Are you planning to invest in the crypto sector, but you don’t know which is the best cryptocurrency to invest in during the 2022 bear market? If so, we’ve made it easy with our complete guide with the best cryptocurrencies to try.
We have also provided our unique wallet and exchange portfolio data to assist you in assessing the activities of other cryptocurrency users in order for you to make educated investments decisions.
Crypto Holders vs. Exchanges
Before we get into which cryptos to buy now, it’s important to understand the difference between wallets and exchanges, both in definition and what they are used for.
A wallet allows you to keep your cryptocurrency safely and securely. You can use wallets to hold your cryptocurrency for a long time, and also participate in decentralized financial (DeFi) transactions.
An exchange, on the other hand is where you can trade, buy or sell cryptocurrencies. These centralized entities are extremely convenient for traders as well as people who want to exchange cryptos quickly and economically. However, exchanges don’t allow you to hold keys to your wallet account, therefore making them less safe for long-term holders – as they say in the crypto space, “not your keys, not your crypto.”
It’s important to note that wallets and exchanges are used by different people and for different purposes, which is precisely why the average exchange user and the average wallet user portfolios differ.
CoinStats allows over 1,000,000 users to monitor and manage their cryptocurrency holdings at any time from over 300 different exchanges and wallet providers.
There are 54.2% wallet users in our user base, 45.8% have CoinStats connected, and only 5.2% have exchange accounts. We will be able to see the preferences of our users in a clear and accurate way because both exchange and wallet accounts are utilized equally.
Now that we’ve clarified that, let’s take a look at some of the best cryptos to buy now based on the cumulative exchange and wallet portfolios.
If you are interested in investing in crypto but don’t know which exchange or wallet to pick, check out our Top wallets and top exchanges reviewed!
Crypto Exchange User Portfolios
It is no secret that crypto-exchange users hold the most valuable asset, BTC. Our data shows that Bitcoin (BTC), is the most held asset of crypto exchange users.
Their portfolios include Ethereum (ETH), with approximately 21%, and Tether(USDT) at around 20%. Binance Coin (BNB) comes fourth with 7.75%, with Binance USD (BUSD), USD Coin (USDC), Cardano (ADA), Polygon (MATIC), Solana (SOL), and Ripple’s XRP (XRP) taking up spots 5 to 10, respectively.
The market cap rankings for the top10 cryptos are almost identical, although there were slight variations in order and Polygon being in the top10.
Crypto investors using exchanges tend to prefer layer 1 or layer 2 blockchain projects over stablecoins, as we can see.
The reason for this is simple – people that hold their money on exchanges are either beginners and are just learning about Bitcoin or crypto (so they stick with the large cryptos), traders who require high liquidity (and trade mainly Bitcoin), or users that want to quickly go in and out of assets, and are sticking with stablecoins to avoid downturns caused by the crypto winter.
Crypto Wallet User Portfolios
Investors who store their cryptocurrency holdings in DeFi wallets have a different experience. Decentralized wallets are the only way to access the functions of decentralized finance (DeFi). This is why wallet users prefer Ethereum.
Bitcoin dropped to rank 3 due to being flipped by USD Coin in light of recent market volatility. The top3 spots have been revealed, so USDT, BNB and SHIB now take up the remaining spots.
You may have noticed that the situation for crypto wallet users is very different. They are more focused on Ethereum and the other DeFi protocol. We can clearly see a significant difference in how crypto investors invest based upon their portfolios. Decentralized finance is only available on Ethereum. This, along with the fact most wallet users are long-term traders, accounts explain the difference.
The Best Crypto Assets You Can Buy Right Now
Now that we’ve seen the difference in portfolios between the average exchange and wallet users, let’s take a look at the best cryptos to buy now.
While exchange users are more comfortable holding Bitcoin than wallet users, wallet users hold the biggest cryptocurrency market capital and third most-held asset. It is Bitcoin, which is also the crypto currency most people use to start trading. The vast majority of Bitcoin stored in wallets are held by traders and long-term investors. As mentioned, Bitcoin can be considered a store-of-value that will appreciate in time.
Bitcoin investing is the best way to get into crypto. Most of the movements the sector takes (up and down) are due to Bitcoin. Bitcoin, due to its institutional adoption, is the most risky cryptocurrency. Although the potential return on investment may not seem as appealing as some of the smaller cryptocurrency options, there are still fewer potential risks.
Bitcoin, based upon the activities of the largest institutional and retail crypto-holders is undisputed leader and the best to buy right now.
Ethereum is the world’s second-largest cryptocurrency, with a market capitalization of over $180 billion. ETH is a favorite choice of traders and investors alike due to its broad range of uses.
Ethereum is used as an exchange medium and to pay transaction fees. It’s also worth mentioning that a large portion of the total supply of ETH is locked up in DeFi protocols, which further adds to its scarcity.
Ethereum is preferred by the crypto wallet community, but it’s second favorite choice for exchange users. Because Ethereum is used primarily for trading and participation in DeFi protocol protocols, this is why it is so popular. The fact that Ethereum is used mostly for accessing DeFi also means that it’s more likely to be influenced by the day-to-day volatility of the crypto markets.
Ethereum remains a safe investment due to its many uses and institution adoption. It has much more upside potential than downside risk, which is why it’s one of the best cryptos to buy now.
Also, check out:How to stake Ethereum
Tether is a stablecoin that’s pegged to the US dollar, with a market capitalization of over $65 billion. USDT is the most popular stablecoin in the world, and it’s used mostly for trading on cryptocurrency exchanges.
The majority of Tether is held on exchanges, as it’s used mostly for trading purposes. Tether lets traders avoid volatility and still allows them to access cryptocurrency quickly.
Tether is a decently safe investment (despite its controversies), as it’s backed by the US dollar and other cash equivalents. However, given its close relationship with the US dollar, it doesn’t have much upside potential.
Tether, therefore, is an excellent choice for those investors who wish to stay away from volatility in crypto markets and wait to invest in promising crypto.
Binance Coin (BNB).
Binance Coin, also known as Binance Cryptocurrency Exchange or Binance Smart Chain Blockchain token is its native currency. It has a market cap of more than $40 billion. BNB can be used to pay transaction fees for Binance, participate in Binance Smart Chain protocols, and for participating in ICOs hosted by Binance Launchpad.
Binance Coin is mainly held in an exchange, and not on any exchange. However, both wallet and exchange users regard it highly. The fact that Binance Coin is used mostly for trading also means that it’s more likely to be influenced by the day-to-day volatility of the crypto markets.
Binance Coin, despite its broad use case and adoption by institutions, is still very secure. It has much more upside potential than downside risk, which is why it’s one of the best cryptos to buy now.
Binance USD is a stablecoin that’s pegged to the US dollar, with a market capitalization of over $17 billion. Binance’s official stablecoin is BUSD.
Both exchange and wallet users are both holding the token. Binance USD lets traders trade cryptocurrency while avoiding volatility.
Binance USD is a very safe investment, as it’s backed by US dollars, and it’s used mostly for trading purposes. However, given its close relationship with the US dollar, it doesn’t have much upside potential.
Therefore, Binance USD is a good choice for investors who want to avoid the volatility of the crypto markets, but it’s not the best choice for those who are looking for upside potential.
USD Coin (USDC).
USD Coin, which is another stablecoin, has been voted one of the most popular cryptocurrencies by wallet and exchange owners. USDC is an American dollar-pegged cryptocurrency that has a market capitalization exceeding $54 billion. USDC has skyrocketed in popularity in recent months due to people trusting its reserve holding audits more than USDT’s holding attests.
USDC can be held by users of exchanges, but wallet users hold the 4th-largest cryptocurrency market cap. BTC took the 2nd spot, and USDC was the 3rd.
There’s not much to say about USDC except that it currently seems that it is the safest stablecoin, and therefore a good place to put your money in if you want to avoid short-term volatility without leaving the crypto space completely.
Cardano ranks 8th among cryptocurrency in market capitalization, at $15 billion. While ADA doesn’t have many use cases at the moment, Cardano is one of the most promising blockchain platforms with an incredible community of developers and investors.
ADA is more commonly held by exchange users than other assets, which makes it one of the most popular 10 most-held assets. However, this digital asset doesn’t seem to be too interesting to wallet users.
Cardano is a way to bet on future functionality and success. This makes it a less risky alternative to Ethereum. However, Cardano has more upside.
Polygon is an Ethereum layer 2 scaling solution. It currently has a market capitalization in excess of $7.2 million. MATIC is the native currency of Polygon. It’s used primarily to pay Gas Fees on the Polygon Blockchain, and also serves as an investment in the Polygon project for the long term.
MATIC was one of the most popular cryptos held by wallet users. However, it did not make the top 10. It is still an intermediate or short-term trade, even though people may use it to pay gas fees.
Polygon remains a safe investment due to its many uses and institution adoption. It has much more upside potential than downside risk, which is why it’s considered one of the best cryptos to buy now.
Also, check out:How to stake MATIC
Solana is a popular blockchain network and one of the so-called “Ethereum Killers.” SOL, its native token, is currently either used for gas fees, or as a short or mid-term trade – as such, it falls in the same space as the aforementioned MATIC.
SOL is a favorite among exchange users, and it was one of their 10 most-held crypto assets. But, Solana is less popular among wallet users due to its uncertain long-term prospects and network instability.
But, Solana has the potential to be a great investment because of its low current price and future growth.
Ripple’s XRP is a cryptocurrency that’s used mostly for payments and money transfers, with a market capitalization of over $17 billion. XRP is used mostly for cross-border payments and money transfers, as it’s much faster and cheaper than traditional methods like SWIFT (which it aims to replace).
On the other hand, wallet users hold the majority of XRP. Ripple is primarily used to make payments or money transfers or for short-term or mid-term transactions, and not as an investment.
While it goes without saying that Ripple had its controversies, we can’t deny that XRP is a digital asset with a huge market cap, and an even larger market. Many people view it as a good investment or a good trade.
Shiba Inu (SHIB)
Shiba Inu, which is an Ethereum-based currency is named after the Japanese hunting dog Shiba Inu. Shiba Inu is widely considered to be an alternative to Dogecoin – in fact, SHIB founders were inspired by Dogecoin when creating their cryptocurrency.
Shiba Inu and Dogecoin are both meme coins – projects that launched as a parody or inside joke that have their communities as their only utility.
Dogecoin’s launch was December 2013. Shiba Inu, however was founded 7 years later by an unidentified individual or group known as Ryoshi.
While the price growth of SHIB (alongside other meme coins) is largely attributed to hype and not fundamentals, numerous investors hold it on their accounts – after all, SHIB made it into the top10 most popular wallet cryptos, taking up none other than rank 6.
Also, check out:How to Take Shiba Inu
DAI, an Ethereum-based stablecoin, is managed by Maker Protocol and MakerDAO (decentralized autonomous organization). DAI’s price is tied to USD and collateralized with a mixture of other cryptocurrency that are deposited in smart-contract vaults every time a new DAI becomes available.
MakerDAO’s transparent ecosystem enabled it to be ranked among the 10 most-popular cryptocurrencies by wallet holders.
However, as DAI is a stablecoin after all, it doesn’t have any upside potential – and given what we’ve seen with the Terra ecosystem, it may have some downside potential.
Decentraland is the most prominent Metaverse ecosystem. Metaverse, one of the most important emerging cryptotechnologies in the 2021 world has been a huge success for MANA.
Decentraland was therefore voted the number one wallet. It is obvious that Decentraland has a lot to offer in terms of its utility and growth potential for the Metaverse sector.
Are You a good time to invest in crypto?
There’s an old saying by Confucius that goes something like:
- “When is the best time to plant a tree?”
- “Ten years ago.”
- “And when is the next best time?”
The best time to start investing in the cryptocurrency market is when Bitcoin’s value was just a few dollars. However, the second-best time is to start now, and learn along the way – and now that you have the list of most popular cryptocurrencies for exchange and wallet users, you are one step closer to making your investment move.
Timing is important
If you’re looking for short-term gains, then it may be a good choice to wait for the market to correct before buying any crypto. However, if you’re looking for long-term gains, then any time is a good time to invest in the cryptocurrency market. The majority of top cryptocurrency market caps are still early adopters and offer a great upside potential.
However, it is important to do your homework before making any investment in crypto.
The Final Word
So, we’ve come to the end of the article! We’ve gone through all the most popular cryptocurrencies, both from the perspective of the wallet and exchange users. All of them are well-known for their strong foundations, which are supported by institutional investors. So, if you’re looking to invest in cryptos, these might be your safest options.
There you have it – the 13 most popular cryptocurrencies at the moment. Every one of these cryptos offers a variety of applications and has strong upside potential. So, if you’re looking to invest in the crypto market, these are the crypto projects that you should keep an eye on. Thank you for reading.
For more crypto-related content, visit our blog or the CoinStats homepage to start tracking your portfolio as a professional!