Best Altcoins to Trade in 2021 (In-Depth Review)

Trading Education picks the top 5 Altcoins to trade this year

Last Updated July 23rd 2021
14 Min Read

Wondering what are the top altcoins to look at in 2021? You are not alone!

The crypto industry is like a rollercoaster of ups and downs, with thousands of coins in existence. No surprise that choosing an altcoin to trade in 2021 might be a challenging task, especially for beginners. Like finding your way out of a maze!

While some cryptos like Bitcoin are well-known across the world, others remain undervalued despite their potential. Thus, to help you enjoy the ride to your crypto trading success, we at Trading Education pick the top five altcoins to trade in 2021.

In addition, we provide different crypto trading courses that can guide you on your trading journey in the constantly-changing world of cryptocurrency.

Are you ready to dive into the awe-inspiring universe of crypto trading?

If you want to dive into the Altcoins market quickly and easily check out eToro Exchange!

Best Altcoins to Trade in 2021: 

  1. Binance Coin (BNB)
  2. Cardano (ADA)
  3. Ethereum (ETH)
  4. Compound (COMP)
  5. Yearn.finance (YFI)

Why Should I Invest in Altcoins in 2021?

With this turbulent year finally coming to an end, many cryptocurrency traders wonder what 2021 might hold for the world of crypto trading. Which altcoins will explode in 2021? Which altcoins should traders avoid? Let’s not forget that the ongoing pandemic has led to high levels of unemployment, financial insecurity, and collapsing economies, so investing in dodgy coins is simply unreasonable. 

But no need to worry anymore! We at Trading Education are here with our top picks for 2021. 

But first, let us explain why investing in cryptocurrency is a good idea in the first place. Crypto trading is an exciting financial venture that can eventually lead to high profits. No wonder that - despite the high volatility in the world of cryptocurrency -  there are more than 50 million active traders across the globe, as per Statista.

Cryptocurrency trading also provides traders with the opportunity to learn new skills and strategies and diversify their portfolios.

Last but not least, we should acknowledge the fact that many altcoins are based on blockchain technology, which has the potential to revolutionise the world far beyond the financial sector. To provide an example, during the ongoing pandemic, blockchain-based technology can be used to transfer real-world medical data in a transparent way.

Blockchain technology can also change gaming, voting, and supply chains to a point of no return.

With so many applications, investing in altcoins in 2021 is definitely worth it, don’t you think?! But which are the top altcoins to trade in 2021?

Top 5 Altcoins to Consider Trading in 2021

With thousands of altcoins in existence, many crypto traders wonder which are the best altcoins to trade in 2021.

If you are a newbie in the world of cryptocurrency trading, though, let’s start with the basics first. Altcoins are coins that are alternative to Bitcoin, hence called altcoins. And as we know, Bitcoin is the first and most popular crypto to trade, with a market cap of $720,960,590,752 as per CoinMarketCap.

Though Bitcoin is considered the king of all cryptos, many altcoins come with promising features and special functions. As a result, crypto traders are becoming more and more interested in trading altcoins.

Read More: Altcoins vs Tokens: What Is The Difference?

To help you choose an altcoin, we at Trading Education present five of the top altcoins to trade in 2021.

1. Binance Coin (BNB)

In case you haven’t noticed, Binance Coin shot up from nowhere in early 2021 and sniped the third-largest market cap. Only recently was it knocked back a bit by Tether (most likely traders looking for a store of value till the crypto market cools down).

BNB is both the utility token used to get a discount on fees at the Binance Exchange and the fuel used to keep the Binance Smart Chain (BSC) up and running.

Both use cases have meant BNB is everywhere these days. Traders are flocking to the Binance Exchange (the biggest crypto exchange by a substantial margin) and devs are flocking over to the BSC to build DeFi services.

The BSC is now so popular that it momentarily beat Ethereum in terms of unique active wallets. Implying more people are using the BSC than the Ethereum network.

But there are things to be concerned about. The biggest of all is that BNB is super centralised. 80% of BNB is owned by Binance wallets.

And that gives them the power to decide who can and cannot be validators on their network. Because of this, for many early crypto adopters, investing in BNB is out of the question.

Read Also: How to Trade Binance Coin: A Step-by-Step Guide

Are you ready to Trade Binance Coin?

2. Cardano (ADA)

Cardano has been one of the biggest earners of 2021 and briefly took the spot of third-largest crypto by market cap until it was pushed down by Binance Coin and Tether.

ADA’s rise to prominence took many of us by surprise as Cardano is yet to offer crypto users anything solid to work with. (Working smart contracts being the primary thing we all want to see.)

That said, a series of upgrades at the beginning of the year probably helped the price hugely.

However, some crypto enthusiasts have pointed out that one of the potential reasons why ADA shot up in value so much is because approximately 73.42% of tokens are staked, which means they are locked up and not moving. 

ADA holders do this to earn interest on their tokens. Anyhow, this gives the perception that there is a limited amount of tokens available and the scarcity pumps up the price.

All that aside, further upgrades in 2021 could mean we may finally see a fully operational Cardano, and if that happens, it wouldn’t be surprising if the value of ADA skyrockets.

Check Out: What Will Cardano Be Worth In Five Years?

Is Cardano the investment you’re looking for?

3. Ethereum (ETH)

Perhaps you are not surprised to see Ethereum on our list. Ethereum is definitely one of the best altcoins to look at in 2021. Though Ethereum is facing some strong competition in the face of other altcoins, such as EOS and NEO (known as the Ethereum of China), nobody can deny the fact that Ethereum is the second-largest coin after Bitcoin.

Unlike Bitcoin, Ethereum is more than a virtual coin. The team behind Ethereum - with charming Buterin at the helm - believes that blockchain technology has numerous applications beyond crypto trading. Ethereum supports the use of smart contracts and decentralised apps (with their own tokens), which has a wide range of advantages across different areas, including commodities trading, sciences, and businesses.

Here we should note that Ethereum was divided into Ethereum (ETH coin) and Ethereum Classic (ETC coin) in 2016, so always double-check the ticker symbols of the coins you want to buy and sell.

At the time of writing, one ETH is $2,766, with some experts being optimistic about its future growth. Thus, though ETH is much smaller than Bitcoin, Ether will still have a place as one of the top altcoins for traders in 2021.

Don't Miss: Will Ethereum Make Me Rich In Ten Years?

Are you ready to trade Ethereum?

4. Ripple (XRP)

While Bitcoin and many altcoins aim to replace our financial system by eliminating the need for central banks and traditional payment networks, Ripple is a unique altcoin that aims to change the actual system in place.

Ripple’s XRP was designed to act as a bridge between currencies, both fiat and crypto, in order to facilitate cross-border payments. Just imagine its potential! While the current SWIFT system employed by major banks worldwide comes with long transaction times and high fees, Ripple can make international transfers in seconds.

Since Ripple’s main purpose is to facilitate transactions beyond borders, its main adopters are large financial institutions. Yet, more and more crypto traders are interested in trading this revolutionary altcoin. making it a valuable altcoin for the coming year and beyond.

Read Also: How to Trade Ripple 2021: A Step-by-Step Guide

Would you consider trading Ripple?

5. Dogecoin (DOGE)

The Joker to Bitcoin’s Batman - no one could have possibly predicted Dogecoin’s jump in popularity in 2021. But jokes aside, Doge is now a serious player.

It bought a sense of humour that cryptocurrency desperately needed which allowed it to reach a much wider audience. Doge can also be used to tip people online for insightful or funny content.

At the beginning of 2021, Dogecoin was an outlier, an old joke that was fading into the background of the cryptocurrency market. But then the Reddit community got really pumped on Doge and a buying frenzy started.

And Elon Musk’s interest only served to boost that buying frenzy. It has also recently been revealed that Musk has been aiding the Doge team since at least 2019.

For many crypto traders, it was all pretty exciting. But things are not all dandy with Dogecoin. The revelation of how long Musk has been involved with the project raises some serious questions about what exactly he is up to.

Furthermore, we need to be pretty serious when it comes to considering how long Redditors will be interested in Dogecoin. Because of this, Dogecoin may be more of a short-term investment, not a long-term investment like most of the other coins on this list.

Read More: Could Dogecoin be a Millionaire-Maker Coin?

Are you ready to trade Dogecoin?

buy binance coin

Other Altcoins to Trade in 2021

While the five coins analysed above are our top picks, we should admit that there are many more coins to buy and watch. Other well-known altcoins to trade in 2021 are Uniswap, Chainlink, Aave, Compound, and Yearn.finance.

1. Uniswap (UNI)

Uniswap is a super exciting project and to some traders that haven’t been paying attention, might seem like a very new project.

In short, Uniswap is a DEX (decentralised exchange). Like a regular exchange, it brings buyers and sellers together. But what makes them different is they’re not the middleman taking a slice of the deal.

Instead, what Uniswap does is provide liquidity to traders by allowing others to stake their crypto, specifically ERC-20 tokens (Uniswap is based on the Ethereum blockchain). Stakers are then rewarded with interest for staking their crypto.

This new way of trading is proving pretty popular. According to DeFi Pulse, in mid-May 2021 there was a total locked value of $8.077 billion on Uniswap. And many crypto enthusiasts believe that DEXs are the future.

2. Chainlink (LINK)

Chainlink is another altcoin worth investing in 2021. It is a decentralised oracle network that can bridge the gap between smart contracts and real-world data.

To do this Chainlink has set up a decentralised network of ‘oracles’ that collect and verify data from the outside world, such as the weather, sporting events or financial news, and feed it into a blockchain.

This allows smart contracts to be much more practical for everyday purposes and it is pretty hard to imagine blockchain technology moving forward without this kind of technology.

Given its unique features, it’s no surprise that LINK, Chainlink’s digital asset token, is among the top cryptocurrencies by market cap.

2021 has been a particularly good year for Chainlink. It momentarily broke into the top 10 by market capitalisation and is the second-largest DeFi project, according to CoinMarketCap.

3. Aave (AAVE)

Aave has taken the DeFi market by storm in 2021! The idea behind Aave is pretty simple - it’s a crypto borrowing and lending platform.

People can borrow crypto from the platform which is provided by ‘stakers’ who earn interest by lending out their crypto.

Based on the Ethereum blockchain, Aave is the second-largest DeFi project by total locked value at $8.7 billion.

What makes Aave so unique above other crypto lending platforms is its flash loans and its option to choose between fixed and variable interest rates.

4. Compound (COMP)

Like Aave and Uniswap, Compound is a DeFi lending project that allows crypto holders to stake their crypto and earn interest on it.

What makes Compound stand out amongst the other lending platforms is how lenders put forward and redeem their crypto.

When lenders deposit their crypto, they get a token in return which can then be used to withdraw, which they can do at any time.

And when they withdraw their crypto it includes all the interest they earned while staking it (hence the name ‘Compound’).

Today, Compound is the third-largest DeFi project by total locked value according to DeFi Pulse.

5. Yearn.finance (YFI)

Just like the others on our ‘other altcoins to trade in 2021’ list, yearn.finance is a DeFi project and it has been making a lot of waves this year.

Essentially, what yearn.finance does is aggregate the best lending platform (e.g., Compound, Aave) to stake crypto on. 

For example, if you stake your Bitcoin on yearn.finance, it will look for the platform that offers the highest returns for it.

Similarly to Compound, when crypto holders stake their crypto, on the platform, they get a token back that they can later use to withdraw their crypto.

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How to Choose An Altcoin to Trade in 2021?

Cryptocurrency trading is attractive, changing, and risky all at the same time, so choosing an altcoin to trade in 2021 is a serious task.

While the top altcoins presented above have some impressive capabilities, always do your research and consider potential risks before you start trading cryptocurrency.

Here we should note that liquidity, volume, market cap, and volatility are some of the major factors to consider when choosing an altcoin to trade, along with market sentiment and tech innovations. Do not forget that crypto news may play a crucial role in popularising or demonising an altcoin, so always follow the news to stay up-to-date.

In the end, whether you choose to invest in a privacy coin like Monero or a stablecoin like Tether, always pay attention to Bitcoin and its price fluctuations

And do not forget that proper crypto trading education and self-discipline are essential to help you master the art of crypto trading. Invest in courses, seminars, and books to find out more about the most popular altcoins to trade in 2021 on your way to becoming a successful crypto trader. 

Of course, once you’ve acquired enough expertise, do not forget to familiarise yourself with the crypto regulations in the country you are based in. After all, no matter if you trade full- or part-time, crypto trading is a serious financial venture that might be subject to taxation and other legal regulations - not just a hobby.

Best Altcoins to Trade in 2021: Key Points

  • Cryptocurrency trading is an attractive investment option in 2021.
  • While there are thousands of cryptos out there, certain altcoins are here to stay for a long time.
  • Some of the top altcoins to trade in 2021 are Binance Coin, Cardano, Ethereum, Ripple, and Dogecoin.
  • Other interesting altcoins to trade next year are Uniswap, ChainLink, Aave, Compound, and yearn.finance.
  • Before choosing an altcoin to trade, always do your research and pay attention to Bitcoin.
  • Proper education and self-control are also vital to help you trade altcoins in 2021.

Do you want to know more about altcoin trading? We at Trading Education are here to guide you on your crypto trading journey and help you choose the best altcoins to trade in 2021. 

Do you think some altcoins are better than Bitcoin? Would you consider trading altcoins? Which altcoin would you choose to trade in 2021? 

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FAQs

Is cryptocurrency a good investment in 2021?

Though cryptocurrency trading can be a risky venture, many experts are optimistic about crypto trading and its potential in 2021. To provide an example, some believe that the increasing use of blockchain-based technology during the ongoing pandemic in areas beyond the financial sector may change social attitudes towards cryptocurrency and attract more and more crypto enthusiasts. 

What cryptos will explode in 2021?

Though many factors affect the world of crypto trading, including demand and supply, technology, and market sentiment, experts believe that some of the top cryptos that will explode in 2021 are Bitcoin, Ethereum, Ripple, Cardano, Dogecoin, Binance Coin, Uniswap, Chainlink, Aave, Compound, and yearn.finance.

What will happen to Bitcoin in 2021?

Despite the increasing numbers of altcoins, Bitcoin - the king of all cryptos - is here to stay. Many experts believe it could hit all-time high levels, as stated by Forbes. At the time of writing, one BTC is $39,013, and many expect that soon Bitcoin will become a store of value that will be much more significant than gold.

Disclaimer: Nothing is guaranteed

Our picks are those we find most interesting based on our research, and are not recommendations for any individual. This is not to be taken as advice to buy or trade.

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