2021, just like 2020, proved to be a good one for cryptocurrencies. However, that is not to say that anyone looking to get in now is late. There are lots of crypto gems that have the potential to deliver even bigger gains for the remainder of the year.
With market prospects looking good, what would be the best cryptos to buy now for someone who has just £1000 to invest?
While it is not the minimum that one can invest in crypto, £1000 is a good amount to spread across three cryptocurrencies. So, which are some of the best cryptocurrencies to invest this cash sum?
Investing £1000 In Top Cryptos
The key factors to consider when investing in cryptocurrencies are passive income, growth, and some risk.
Passive income cryptos boost the income that can then be invested in growth cryptos and high-risk, high-reward cryptocurrencies.
Therefore, with £1000, it would be best to choose top passive income crypto, growth crypto, and a risky but high potential cryptocurrency that can generate parabolic gains in a short time.
It would be best to put £500 in a passive income cryptocurrency, £300 in a stable growth coin, and £200 in a high-risk crypto for optimum resource utilization.
Top Cryptos: #1 Cardano (ADA)
Currently, a couple of passive income cryptos are pretty undervalued when looked at from their fundamentals. A good example of such a cryptocurrency is Cardano (ADA).
Cardano has been on a roll recently and is now the 9th-largest cryptocurrency by market capitalization. It is currently trading at $0.886.
One factor that has given Cardano so much momentum recently is the upcoming launch of smart contracts on its mainnet.
For months, Cardano has been running smart contracts on its testnet. It is expected that once smart contracts start running on the Cardano mainnet, this blockchain could take on Ethereum and take a substantial share of its market.
Such projections are not without basis. In terms of tech capabilities, Cardano is far much ahead of Ethereum.
Cardano is what would be considered a third-generation blockchain, while Ethereum is 2nd generation.
To understand how far ahead Cardano is, one needs to look at the fact that Cardano has had a working and provably secure Proof-of-Stake algorithm for years. On its part, Ethereum is only starting the shift to Ethereum 2.0.
Besides it being a next-generation blockchain, Cardano has some pretty high staking rewards too. At the moment, the rewards for staking Cardano stand at 12%. This, while it’s variable, is a good source of passive income.
High staking rewards coupled with Cardano’s high potential for adoption makes it top passive income crypto to bet £500 on today.
Check Out: Cardano (ADA) Price Predictions
Growth Crypto: #2 Ethereum (ETH)
Ethereum (ETH) is a no-brainer for anyone who wants a mix of growth and stability. Ethereum is now at a place where it is unlikely to experience the high volatility that is characteristic of most altcoins.
That’s due to its high market capitalization and the fact that it is heavily used for different purposes in the crypto space.
For context, all through 2021, Ethereum has outpaced Bitcoin in new addresses by a huge factor.
That’s an indicator that a lot more people are now investing in and using Ethereum for development than they are Bitcoin.
Once Ethereum makes the full transition to Ethereum 2.0, its usage will grow by an even bigger factor. This places it in a good position to deliver value growth consistently over time.
Ethereum’s potential as a growth crypto is also amplified by it becoming one of the favourite cryptos for institutional money.
It is the only crypto that seems to be giving Bitcoin a run for its money in institutional adoption.
All across the globe, wealthy investors and investment funds are buying Ethereum either directly or through derivatives.
Given that institutional money will be a key factor to crypto demand going forward, Ethereum’s long-term prospects look good.
At this point, Ethereum is not the kind of crypto that can make someone rich overnight, but for those who can invest now, it will definitely generate wealth long term.
With all these factors at play. It makes sense to invest £300 in Ethereum this May if the total investable capital is £1000.
Don't Miss: Ethereum (ETH) Price Predictions
High Risk High-Return: #3 Society for Galactic Exploration (SGE)
Anyone who has been in crypto for a while knows that even a small investment in the right project can make one rich with the right timing. For instance, anyone who put in just $200 in Dogecoin in early 2020 got life-changing profits out of it.
With this in mind, Society for Galactic Exploration (SGE) is a crypto that could be in that good zone at the moment.
This crypto launched only a few months ago and has accomplished many milestones on its roadmap. It’s nominally cheap too, and with just $100, one can buy billions of SGE.
However, aside from the roadmap and the low price, this crypto has planned a major event on December 31st, 2021.
The project will take part in a space shuttle launch to the moon. According to the SGE website, they will send 1 SGE for every human on earth to the moon.
Given the excitement that has characterized space events recently, this event could create FOMO that could see SGE rocket by 1000s of percentages in days.
For this reason, it would be worthwhile to allocate this project £200 out of £1000 within this month.
While the above is a good portfolio to spread £1000, it is important to remember that crypto as a whole is still a speculative and high-risk asset class. Any slight bad news can easily send the market tanking at any time. Elon Musk’s negative comments on Bitcoin back in April are a good example.
However, this market has proven that it rewards those who take a long-term view of things. If you are eyeing the next 5 to 10 years, then short-term market fluctuations are irrelevant.
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Virtual currencies are highly volatile. Your capital is at risk.