We recently curated a comprehensive list of the 12 Best Cryptocurrencies to Invest in According to Reddit. In this deep dive, we will explore Bitcoin’s (BTC) position relative to other cryptocurrencies.

The past year has been tumultuous yet exhilarating for cryptocurrency investors. The approval of spot Bitcoin ETFs in Q1 set the stage for a dynamic market landscape, with the SEC signaling approval for spot Ethereum ETFs by May. Consequently, spot Bitcoin ETFs amassed over $50 billion in combined assets within six months of trading, a milestone many market experts consider the most successful ETF category ever launched.

Beyond spot offerings, crypto-themed ETFs have shown remarkable performance in the first half of 2024. For instance, the First Trust SkyBridge Crypto Industry & Digital Economy ETF experienced a robust year-to-date (YTD) growth of over 20%. Blockchain-focused products also gained significant traction among enthusiasts. Amplify Transformational Data Sharing ETF rose by over 19% YTD, showcasing the growing interest in blockchain technology.

Artificial Intelligence and Crypto: A Crucial Intersection

In recent months, the integration of Artificial Intelligence (AI) into the crypto world has been a notable development. AI tokens are cryptocurrencies tied directly to AI ventures, supporting projects, applications, and services such as decentralized AI marketplaces and AI-driven decentralized autonomous organizations (DAOs). Users can utilize these tokens to pay for services or access data on these platforms, while platforms can reward users with tokens to incentivize participation. These tokens often grant holders governance rights, enhancing their utility.

According to CoinMarketCap, the market cap for AI and big data cryptocurrency projects surged by over 70% in just a few weeks, indicating renewed investor confidence in this sector.

Regulation of Cryptocurrency and Exchanges

High-profile meltdowns like FTX have brought regulatory scrutiny to the forefront of the cryptocurrency industry. The collapse of this leading exchange highlighted the urgent need for regulation. Today, government entities are more proactive in enforcing rules. The Securities and Exchange Commission (SEC) has emerged as the most active watchdog in the crypto market.

CNBC reports that the US has been particularly assertive in legal actions against crypto companies, with the SEC suing two major crypto exchanges. Clear regulatory standards could pave the way for institutional investors like banks and asset management firms to invest in crypto assets. A bi-annual survey by KPMG in Canada and the Canadian Association of Alternative Assets and Strategies (CAASA) found that 22% more financial services organizations offered crypto-asset products and services to clients in 2023 compared to 2021. Additionally, 26% more institutional investors included crypto-related assets in their portfolios in 2023 compared to 2021.

Coinbase highlighted that updated Q2 2024 13-F filings showed strong institutional inflows into US spot Bitcoin ETFs, with institutional ownership rising from 21.4% to 24.0% between Q1 and Q2 of 2024.

Cryptocurrency Market Outlook

The United States International Trade Commission reported that global revenues from tokenized asset exchanges reached approximately $26.5 billion in 2022, with around 76% coming from cryptocurrencies. Revenues surged significantly in 2021 due to the growth of non-fungible tokens (NFTs) and rising prices of major cryptocurrencies. McKinsey projects that the total tokenized market capitalization could reach around $2 trillion by 2030, driven by adoption by mutual funds (MFs), bonds and exchange-traded notes (ETNs), loans, securitization, and alternative funds.

Globally, the cryptocurrency market capitalization exceeded $2.5 trillion according to Forbes, with Bitcoin alone reaching a record high of over $73,000 and a market cap of $1.4 trillion by mid-March 2024. The cryptocurrency market is expected to grow to approximately $6.6 billion in 2024, with user numbers projected to reach 107.30 million by 2025.

Growth in this market is anticipated to be driven by increased acceptance and adoption of cryptocurrencies by institutions and individuals, greater use of decentralized finance (DeFi) platforms, advancements in blockchain technology, and higher usage for cross-border transactions.

Our Methodology

We scoured numerous communities, subreddits, and threads to compile our list of the top 12 cryptocurrencies, selecting those that were trending. These cryptocurrencies were then ranked in ascending order based on their market capitalization as of August 29.

At Insider Monkey, we are passionate about tracking the stocks that hedge funds invest in. Our research indicates that we can outperform the market by mimicking the top stock picks of leading hedge funds. Our quarterly newsletter’s strategy involves selecting 14 small-cap and large-cap stocks each quarter, achieving a return of 275% since May 2014 and outperforming its benchmark by 150 percentage points.

Bitcoin: The Pioneer Cryptocurrency

Bitcoin is the world’s first cryptocurrency, securely stored and exchanged online via a digital ledger known as blockchain. Launched in January 2009, Bitcoin operates as a peer-to-peer online currency, enabling direct transactions between independent network participants without intermediaries. This digital currency is immune to inflation or manipulation by any individual, company, or central bank.

Bitcoin’s key innovation lies in its blockchain technology, which records every transaction ever made using this digital currency on a distributed ledger verified across a network of computers. This decentralized nature means no single entity can control it, allowing anyone to participate.

The Bitcoin network recently introduced Ordinals NFTs and BRC-20 tokens, sparking significant community enthusiasm and expanding its scope.

Overall, Bitcoin ranks first on our list of the best cryptocurrencies to invest in right now. While we recognize BTC’s investment potential, we believe some undervalued AI stocks offer even greater promise for higher returns in a shorter timeframe. If you are seeking an undervalued AI stock trading at less than five times its earnings with more promise than BTC, check out our report on the cheapest AI stock.

For further insights: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’

Disclosure: None. This article was originally published at Insider Monkey.