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Five cryptocurrencies popular among South Africans

Friday March 03 2023
cryptocurrencies

While it is true that cryptocurrencies are the most volatile asset you can invest in, it has laid out a foundation for many retail investors to make considerable sums of money. PHOTO | SHUTTERSTOCK

One of the many positives when investing in cryptocurrency is that it is a 24-hour global market. As a result, you aren't confined to the restraints of a localised market or a select number of investors moving the price of an asset with fear and uncertainty. 

South Africa has cryptocurrency regulations, which have recently been upgraded. This is more than can be said for many other world economies with significant ambiguity within their investment systems.

While it is true that cryptocurrencies are the most volatile asset you can invest in, it has laid out a foundation for many retail investors to make considerable sums of money. Today we will examine five cryptocurrencies that are popular amongst South Africans.

Bitcoin (BTC)

While Bitcoin (BTC) isn't exactly the best crypto South Africa traders look to trade in the short-term, it is by far the most popular. You'll see that the five cryptocurrencies that we will be examining today follow a similar pattern to world cryptocurrency markets. 

In addition, traders in South Africa follow the same patterns as traders from other prominent digital asset trading countries across the globe.

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As Bitcoin is the largest cryptocurrency by market cap, it is no surprise that this is the most popular digital asset among South African traders. 

Bitcoin is the original cryptocurrency. Who created the infamous currency is anybody's guess. Some people have narrowed it down to a handful of cryptographers, but nobody knows whether it is one person or a group. It is a name known only as Satoshi Nakamoto. With the rise of CBDCs, the institutions invested in Bitcoin could move their money toward these types of assets instead, but only time will tell.

Ethereum (ETH)

That's right, you guessed it, coming in at number two is the world's second-largest cryptocurrency by market cap - Ethereum. 

Ethereum is a decentralised platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud, or third-party interference. This makes it possible for developers to create innovative products and services that are secure and cost-effective.

Vitalik Buterin is the face of Ethereum, but he designed it with three other visionary cryptographers. The growth of Ethereum has been mainly through its platform, which has revolutionised how we do business. It enables developers to create and deploy decentralised applications (dApps) on its blockchain network — renowned for its security and reliability (and gas fees, sorry, Vitalik!)

With Ethereum, traders and investors can securely store, buy and sell digital assets such as Ethereum (ETH), tokens, and other cryptocurrencies built on the network.

Binance Coin (BNB)

Binance Coin (BNB) is a token created by the Binance exchange. It currently facilitates over 1 million transactions per second. Not only is BNB used to pay for fees on the Binance platform. Including fees such as

  • Trading
  • Withdrawal
  • Listing 

But it allows other projects to build a liquidity pool and trade across smaller exchanges for smaller cap tokens. 

Despite its innovation, it is not without criticism. Some detractors have stated that the coin facilitates widespread small-cap coins with no utility, many with dubious project designs and setups. However, given that Binance is the world's largest cryptocurrency exchange, its native token experienced a considerable boom throughout the bull run in 2021. 

XRP

At one point in 2017, XRP was the second-largest cryptocurrency. However, it has since fallen from grace due to a huge legal battle in the United States, and the SEC launched legal action against XRP creator Ripple Labs in December 2020. They accused the CEOs of the company, Chris Larsen and Brad Garlinghouse, of profiting off an unregistered securities sale. 

The pair have argued that XRP is a cryptocurrency and have been battling hard in court. Nevertheless, as have many other countries, South Africans have continued to trade XRP. If Ripple comes out victorious, the price of this asset could explode quickly.

Litecoin (LTC)

Litecoin (LTC) is a cryptocurrency that was created in 2011 as an alternative to Bitcoin. It is based on the same blockchain technology as Bitcoin but has some key differences. 

When it was first designed over a decade ago, the aim was for Litecoin (LTC) to have faster transaction times, lower fees, and a larger total supply than Bitcoin. It is known for this and still provides decent returns for many investors.

Conclusion

Due to the nature of cryptocurrency, this list can change at any time. So, depending on when you are reading this article, there may be a couple of new additions! Such is the landscape of such a volatile, ever-changing global marketplace. 

If you invest in cryptocurrency, ensure you perform plenty of market research before you decide to plunge into the volatile world of digital assets.