Among the top cryptocurrencies, what would have the biggest returns for a $1000 investment in January 2021?
According to CNBC, the highest yielding crypto this year is Solana, as a $1000 investment in the SOL token at $1.53 last January would have grown to around $118,418, based on Tuesday's price of $181.18. It just launched in 2020, and since then the Solana price soared to over 13,800 percent over the current year.
It is now the fifth largest token in terms of market cap, valued at $57 billion.
Solana Price Increase Due to Smart Contract, DApps Support, Transaction Speed
Solana is considered among the purported "Ethereum killers," designed to support smart contracts, which are a series of code that implement a strict set of instructions on the blockchain. It also supports decentralized apps (DApps), which can run programs such as financial services without the purview of single authority. These include a rapidly increasing market share in non-fungible tokens (NFTs). Solanart, an NFT marketplace that runs on the Solana blockchain, allows NFT buyers to benefit from faster transactions at lower fees than on Ethereum.
What made Solana such an immense success in the crypto world? Its biggest selling point is its transaction speed, US News noted in a report. The blockchain is able to support tens of thousands of transactions per second, compared to its rival Ethereum's 13 transactions per second. Solana operates on proof-of-history (PoH) and proof-of-stake (PoS) models that confirm transactions based on the ownership of coins. This easier verification setup allows Solana to charge lower transaction fees than Ethereum. The blockchain charges an average fee of less than $0.01 per transaction.
Dogecoin Is Second-Biggest Money Maker
The second biggest money maker among cryptocurrencies is Dogecoin, with a $1000 investment in January at a value of $0.0056 per coin yielding around $32,142 at Tuesday's price of $0.18, CNBC further stated in its report. This token, which started out as a joke cryptocurrency, skyrocketed by as much as 12,000 percent in the first half of 2021, owing largely to Elon Musk's tweets in support of the meme coin.
Investors would have made more at the end of the year, but DOGE's value dropped in the succeeding months due to a variety of factors.
As for the biggest cryptocurrencies, investors would not have made much out of their $1000 investment in January this year. Such an investment for Bitcoin at a price of $29,290 at the start of the year would now be worth around $1,632, based on Tuesday's price of $49,150 per token. Being the largest token by market cap, having its value increase by 65 percent in 2021, Bitcoin reached a trillion-dollar market cap in February but decelerated somewhat and has now settled at $900 billion.
As for Ethereum, a $1000 investment in January at a price of $730.30 would have made $5,226.16, based on Tuesday's trading figure of $3,816.67. The token's advocates said that an upcoming shift to a proof-of-stake model and a scheduled Eth2 upgrade in 2022 would make the blockchain increasingly scalable, secure and sustainable, thus boosting returns in the coming year.
