It's possible to find some tremendous bargains in the crypto market right now. Just about every major cryptocurrency is in the red during the past 90 days, and even some formerly high-flying cryptocurrencies are well off their all-time highs from just a few months ago.
So, against this backdrop, what's the best cryptocurrency to buy with $500 right now? The answer should not be surprising. It's still Bitcoin (BTC 0.60%), and it's not even close.
Bitcoin vs. the crypto market
Let's zoom out and take a look at the overall crypto market during the past three month. During that time period, Bitcoin is down about 20%. That's obviously of major concern, but just consider the following: just 26 of the top 100 cryptocurrencies in the world have fared better than Bitcoin during that time period.
CRYPTO: BTC
Key Data Points
Ethereum (ETH 0.14%), for example, is down 24% over that time period. Shiba Inu (SHIB +1.05%) is down 22%. Litecoin (LTC 0.95%) is down 28%. Chainlink (LINK 0.63%) is down 34%. Trendy meme coins such as Pepe (PEPE 1.10%) and Pudgy Penguins (PENGU 0.16%) are down anywhere from 30% to 55%. This is gut-wrenching stuff.
And what about the cryptocurrencies that are outperforming Bitcoin over the past 90 days? There's not much to like. The best options are a few highly speculative decentralized finance (DeFi) plays that have skyrocketed in value during the past 90 days. There's also an AI-powered meme coin that's up a head-spinning 2,273%.
Image source: Getty Images.
So, on a relative basis, Bitcoin's recent performance is not as disastrous as it might first appear. I'd rather buy a well-established cryptocurrency with a proven track record going back more than 15 years than a speculative new DeFi project that might implode at any moment. Case in point: several trendy DeFi plays from 2024 and 2025 are now some of the biggest laggards in the market during the past 90 days.
Bitcoin's $1 million price target
But here's what really has my attention: investors continue to rally around the $1 million price target for Bitcoin. A number of notable crypto industry insiders have predicted that Bitcoin will hit a price of $1 million by 2030. In fact, Cathie Wood of Ark Invest thinks Bitcoin might hit $1.2 million.
So let's back up for a moment and do the math. For Bitcoin to hit a price of $1 million by the end of 2030, it would need to gain at a compound annual growth rate (CAGR) of 60%. That might seem like wishful thinking, except for one astonishing fact: Bitcoin has delivered triple-digit percentage gains in seven of the past 14 years. That's right: Bitcoin has a proven track record of doubling in value with impressive regularity.
How to put $500 to work?
While it's perfectly OK to buy a fractional Bitcoin with your $500, there are other options for investors. After all, it might feel deeply unsatisfying to find out that you own just .005 Bitcoin in your crypto account after plunking down $500.
NASDAQ: IBIT
Key Data Points
With that in mind, many of the new spot Bitcoin exchange-traded funds (ETFs) now trade for a much more affordable price. For example, the iShares Bitcoin Trust (IBIT 0.42%) trades for a price of just $50. For $500, you could pick up 10 shares of this ETF and have 1-to-1 exposure to the price of Bitcoin.
Or, you could just as easily deploy your $500 as a series of recurring $50 buys throughout 2026. This is known as a dollar-cost averaging (DCA) strategy, and it's one way to protect yourself from sharp swings in Bitcoin's price.
With a DCA strategy, the lower that Bitcoin goes, the more that you buy. And, conversely, the higher that Bitcoin goes, the less that you buy. This DCA strategy takes out most of the emotional stress of investing in crypto. All you have to do is commit to buying a fixed amount of Bitcoin on a recurring basis.
Given how disappointing crypto prices have been during the past three months, it's not surprising that some investors have given up on Bitcoin. But I think that would be a mistake. Instead of focusing on short-term price swings, focus on the long-term upside potential. And, right now, I can't think of a cryptocurrency that has more long-term upside potential than Bitcoin.
