The extreme volatility of Bitcoin was on full display on April 14th, 2021, when it hit an all-time high at just below $65,000. These record-breaking gains led to a fear-of-missing-out, or FOMO, among day-traders and hedge-fund managers alike, causing a surge in retail investment interest in the Crypto market. This de facto gold rush was also marked by institutional investors like Tesla, who’s CEO Elon Musk announced in February that Tesla had invested $1.5 billion into Bitcoin. Tesla has since halted Bitcoin transactions due to climate concerns and will start up again when miners’ energy usage is cleaner. While today Bitcoin hovers around $33,000, this is just a 50% plunge after an almost 500% increase since last summer.

At a market cap of about $250 billion and a per-token value of over $2000, Cryptocurrency Ether (commonly referred to as Ethereum) are the next most significant players on the scene after Bitcoin. While the Ethereum network’s primary focus is the facilitation of smart contracts and decentralized applications rather than an alternative monetary system, Ether has been pushed into competition with other Cryptocurrencies by its own popularity. Additional popular coins include XRP, Litecoin, Binance Coin and Cardano.

The institutionalising phase

More than 60 central banks have explored CBDCs since 2014, where the payment infrastructure would function similarly to existing digital wallets and mirror the convenience and efficiency of completing a transaction with the wave of a phone at a payment terminal. In May of 2021, the Bank of Israel announced that they are researching the feasibility and benefits of developing their own central bank digital currency (CBDC) as well as an action plan for the potential issuance of a digital Shekel.

In a global economy where Cryptocurrencies are on the rise and notes and coins are quickly falling out of use, central banks like Israel’s are feeling the pressure to develop a viable alternative before unregulated payment forms become the norm. Issuing this digital form of fiat currency comes with an expectation for many benefits, such as providing security to all transaction participants, creating an efficient and cheaper cross-border payment infrastructure, and ensuring a backup for the payment system in case of an emergency breakdown. This also means increased inclusion of unbanked individuals, resulting in accelerated competition for private companies as they feel the pressure to answer calls for greater transparency standards.

Ether
Ether (ETH) is the cryptocurrency that underpins Ethereum network, known colloquially as the “world computer”.
Launched in 2015, Ethereum took Bitcoin’s public blockchain model and added the ability to code automated agreements (called smart contracts) that execute automatically when a set of parameters are met.
This new blockchain network also introduced the concept of decentralized applications (Dapps), which make use of the distributed nature of the network, and it’s also the foundation on which the blossoming DeFi and NFT markets are built.
Ether is the fuel on which this whole operation runs, which means it has a deep pool of potential use cases. If you want to participate in the Ethereum ecosystem, purchasing ether could be a good place to start.

Binance coin
When it launched in 2017, Binance Coin (BNB) used the Ethereum network as a foundation, but has since become the native currency of the Binance Chain.
The coin is used to pay fees and make trades on Binance, the world’s largest cryptocurrency exchange. Users are incentivized to do so by the opportunity to secure discounts.

One quality that sets Binance Coin apart from is that Binance has committed to using 20% of its profits to buy back and destroy BNB tokens. This process is designed to restrict supply and boost value, and will continue until 100 million tokens (half the total supply) have been burned.
In September last year, Binance launched the Binance Smart Chain (BSC), which boasts many of the same smart contract and DeFi functionalities as Ethereum and is based around BNB. It’s also much faster than the Ethereum network.
However, while some have referred to BSC as an “Ethereum killer“, others have registered concerns about the centralized nature of the project, which is managed and overseen by a single entity: Binance.
Tether
Tether (USDT) differs from the other cryptocurrencies on this list in that it is not subject to the same levels of volatility.
As a fiat collateralized stablecoin, Tether is pegged against a stable asset. In this case, for every unit of Tether in circulation there is one US Dollar sitting in reserve, which means the price of the cryptocurrency maps the exact price of the fiat currency.
This consistency in value allows users to transact using Tether, content in the knowledge that purchases will have the equivalent dollar value the next day, or the next month.