Most of us wish we had invested in -- or invested more in -- Bitcoin. The world's first cryptocurrency started out at around eight cents in 2010. And this year, it surpassed $60,000. Of course, it may not be too late to get in on this crypto titan. Some predict it will move even higher into the future. (And, as with many investments, others say just the opposite.)
But you may not want to hop on the Bitcoin train this late in the game. Instead, you may hope to find the next big mover in the cryptocurrency space and get in on the growth story earlier. If so, here's what you should consider buying now.
A significant place for NFTs
I'm talking about the cryptocurrency Solana (SOL -1.04%). If you're a fan of non-fungible tokens (NFTs), you may have heard of the Solana blockchain. An NFT is a bit of data stored on a blockchain -- it is unique and operates like a certificate of authenticity and ownership. For instance, you can buy an original piece of artwork this way. Solana has become a significant platform for the creation and buying and selling of NFTs. The platform is the fourth biggest by sales volume, according to CryptoSlam.
But Solana isn't only about NFTs. A variety of projects can be built on the blockchain, including decentralized finance (DeFi) projects and games. And, of course, all of this is connected to Solana's own cryptocurrency known as "Sol." The currency started the year at only $1.50 -- it's since soared a whopping 14,000%.
Users like Solana for two reasons: Speed and cost. In fact, it beats bigger rival Ethereum when it comes to both. Solana can process about 50,000 transactions per second. That's compared to about 15 for Ethereum. And this is part of the reason why it's also cheaper to make a transaction on Solana: It's faster to process a larger block of information on the platform. Fees are less than a penny per transaction, while Ethereum fees these days are about $4.
Why is Solana so speedy compared to peers? The company relies on its own method to validate transactions. It's called proof of history (PoH). PoH puts a timestamp on transactions to speed up validation. And what slows down Ethereum? Its proof of work method -- validators must solve complex mathematical puzzles in order to complete a transaction.
Sol tokens in circulation
Solana is a relatively new kid on the block. Former Qualcomm engineer Anatoly Yakovenko co-founded the project and launched it in 2020. Today, there are about 302 million Sol circulating. When Solana started, it increased supply 8% annually. Now, that will decrease by 15% each year -- until it reaches an issuance level of 1.5%. That's where it will stay. So, while supply will increase, it will do so in a controlled manner.
What does all of this mean for investors? Solana's speed, low cost, and the ground it's already gained in NFTs could power its value higher in the long term -- even after this year's big increase. That said, cryptocurrencies always come with a significant amount of risk. If you invest, you should only do so with money you can afford to lose.
Considering this, if you're still ready to take the plunge, Solana is a good option. You may have missed out on Bitcoin. But Solana could offer you a second chance at significant cryptocurrency gains.