Known as the king of all cryptocurrencies, Bitcoin is still the most valuable digital asset in the world, with a market capitalization of over $700 billion. In 2021, the currency invented by Satoshi Nakamoto reached all-time highs, peaking at over $60,000 in April.
However, Bitcoin's recent bull run suffered a significant decline in mid-April. Currently, “digital gold” is trading at around $38,000 with slight fluctuations up and down.
In this context, many investors are looking for investment alternatives to participate in the crypto market without buying Bitcoin. In this article, you will discover 3 ways to profit from the crypto markets without buying Bitcoin.
In addition to this, you can also try crypto derivatives such as futures and options, available on specialized platforms such as Binance Futures, FTX and Bitlevex.
Considered Bitcoin's biggest dark horse, Ethereum (ETH) is the second-largest coin by market capitalization ($280 billion in total market value).
It is essential to note that Ethereum is the name of the platform itself, while Ether is the digital currency in which you will invest. Additionally, Ether is used to pay gas fees on the Ethereum network.
The goal of Ethereum is to be a platform for the execution of smart contracts, as well as other cryptocurrencies (tokens) built on the platform. In fact, the main factor that distinguishes Ethereum from Bitcoin is the fact that it runs smart contracts.
Smart contract technology is one of the most promising innovations available on the market, as it has the potential to change the way real-world transactions are conducted.
Currently, Ethereum is trading at around $2,400 per coin, which is quite an impressive number considering it was trading around $200 last year. Ethereum supply is currently around 116,000,000 ETH in circulation, but other tokens can be created endlessly on top of the platform.
Cardano is another smart contract platform, but it aims to be better than Ethereum in terms of scale, speed, and energy efficiency. Founded in 2015 by Ethereum co-founder Charles Hoskinson, the platform is open-source and uses a PoS (Proof-of-Stake) consensus mechanism.
Compared to Bitcoin and Ethereum, Cardano stands out by not relying on PoW (Proof-of-Work) as a consensus mechanism.
Therefore, Cardano (ADA) stakeholders are responsible for verifying and validating transactions, which means that the more ADA you hold, the better your chances of getting those tokens as a reward.
In this way, unlike Bitcoin and Ethereum, Cardano does not require any mining effort. In fact, the reality is that a PoW model is not as good as a PoS model because it does not incentivize users to stay around the same blockchain network.
Some investors believe that using Cardano as a hedge for Ethereum can be a good strategy, especially since we don't know what the definitive smart contract platform will be in the future.
Considered by experts to be one of the most underrated digital assets in the crypto industry, Polygon (MATIC) is a multi-chain scaling solution for Ethereum. The goal of the platform is to provide faster and cheaper transactions on the Ethereum network using Layer 2 side chains.
Scaling has become a growing demand among Ethereum users, especially when it comes to reducing network congestion and gas fees. In addition to Layer 1 and Layer 2 scaling upgrades, Polygon aims to create an ecosystem of multiple scaling solutions such as sidechains, plasma, Zk lamination and other innovations similar.
Currently, Polygon is trading at $1.51 per coin, with a market of around $9 billion. Although it may seem a bit boring compared to more bullish coins, Polygon's long-term potential cannot be compared.
