Despite being well off their peak prices right now, both Dogecoin and Shiba Inu have posted monster returns. Those who were lucky and bold enough to buy these tokens early on have likely generated lots of wealth. But for those who have been on the sidelines, it might be very tempting to jump on board in hopes that another huge rally is just over the horizon.
Instead of putting your hard-earned money into these highly speculative dog-inspired meme tokens, it's worth taking a closer look at three other cryptocurrencies. I think they are better digital assets to buy than Dogecoin or Shiba Inu.
Ethereum
With a market cap of about $228 billion , Ethereum is the world's second-most-valuable cryptocurrency. What makes it special is that it was the first blockchain network to incorporate smart contracts. These are software programs that run automatically when two willing parties satisfy the requirements of a transaction.
Many crypto enthusiasts believe that smart contracts could be game-changing for the crypto industry because they have the potential to disrupt a wide range of industries that rely heavily on expensive intermediaries. In fact, Ethereum is already the top blockchain when it comes to decentralized applications, ranging all the way from gaming to security and social media.
Last year, Ethereum completed what's known as The Merge. This transitioned it from a proof-of-work consensus mechanism to a proof-of-stake (PoS), relying on token holders to help verify transactions rather than power-hungry computers to solve complex math puzzles. The result is a more energy-efficient network that is laying the foundation to scale better and handle more transactions at lower fees in the future as usage rises.
Ethereum's co-founder, Vitalik Buterin, has five more upgrades in the pipeline. All have the intention of getting Ethereum ready for mass adoption.
Cardano
Like Ethereum, Cardano also uses smart-contract technology. Since its launch in 2017, Cardano has climbed 1,000%, although it's currently down 90% from its all-time high. As of this writing, it's the seventh-most-valuable cryptocurrency.
One of Cardano's most impressive features is its phased development approach. Unlike most cryptos, this network aims to be cautious, thoughtful, and research-driven, leaning on the work of computer scientists and academics from around the world to come up with ideas for necessary updates to the system. Currently, Cardano is in Voltaire, its last stage, focused on developing governance functionality.
With the completion of Hydra, a Layer-2 scaling solution, Cardano should be able to handle thousands of transactions per second. This is much more than Ethereum's 12.
Even today, Cardano has made inroads in terms of its technology finding enterprise-level solutions. In the educational sector, it can help verify academic credentials. In financial services, it can streamline the client onboarding process. And in the agriculture industry, Cardano can track food from its source through a supply chain.
Solana
Last on this list is Solana, which is valued at under $7 billion right now, good enough to rank as the ninth-most valuable crypto. It was launched by ex-Qualcomm engineer Anatoly Yakovenko in 2020. And its price has soared 1,700% since that time.
This discussion has focused on blockchains with smart contracts, and Solana is no different. But while both Ethereum and Cardano operate PoS systems, Solana also runs something called proof-of-history. This is a feature that essentially removes the need to add timestamps to the data on the blockchain, which can speed up transactions. Solana can process 50,000 TPS today, making it a top-tier crypto in terms of speed.
Cryptocurrency naysayers believe the technology will never create valuable real-world utility. But Solana begs to differ. Early last year, Solana Pay was launched. This service uses the Solana blockchain to directly connect merchants and consumers, resulting in instant settlement and virtually no fees. Payment processing can be a huge cost for small businesses, so Solana Pay could be a worthy solution. The added benefit is that it can drive customer loyalty by introducing cool features, like non-fungible tokens (NFTs), to the transaction process.
While Ethereum, Cardano, and Solana all have unique features, investors need to understand that there is still a lot of uncertainty regarding the future of cryptocurrencies. And so they should only command a tiny fraction of a portfolio.
