Explainer: What are penny cryptos? Check out some of the top penny cryptos-XRP, Cardano, etc.

Cryptocurrency investing seems to be a rage in recent times. In order to diversify their investment portfolios, several tech-savvy investors are eyeing digital coins which offer high value along with being affordable at the same time.

This is where the penny cryptos come into the picture.

As the name suggests, penny cryptos are the namesake of penny stocks. They are extremely low priced and typically trade for less than a dollar. These penny cryptos are a big hit among the new entrants to the crypto market as well as small-time crypto traders.

However, it does not imply that penny cryptos do not witness appreciation in their value. In fact, a steep rally in a short time can bring windfall returns for backers. That said, these cryptos are relatively more volatile, with prices fluctuating in either direction.

Due to their low-priced nature, these penny cryptos are hugely popular among crypto investors.

Let us now take a closer watch at some of the popular penny cryptos which seem promising.

XRP

XRP, also known as XRP Ledger is an open-source, permissionless, and decentralised technology, which was founded in 2021, its native coin being XRP. It is being majorly used by developers to create solutions that solve inefficiencies, including remittance and asset tokenisation.

Moreover, XRP is low-cost, settles transactions almost instantaneously, and is energy-efficient. The token is listed on several top crypto exchanges like Binance, Huobi, Bitstamp, etc.

Cardano

Launched in 2017, Cardano is a proof-of-stake blockchain platform, whose native token is ADA. The launch of the Alonzo hard fork brought smart contract functionality to the blockchain.

It uses the PoS consensus mechanism, which is less energy intensive than the proof-of-work (PoW) algorithm relied upon by Bitcoin.

Several renowned exchanges like Binance, Bittrex, eToro, and HitBTC offer trading in Cardano crypto.

Dogecoin

Dogecoin is a popular meme coin, featuring a Shiba Inu on its logo. Though it was created as a lighthearted alternative to traditional cryptos, it has become seriously valuable and has the alleged backing of billionaire Elon Musk. Ever since the Tesla boss began tweeting about this crypto since last year, Dogecoin has witnessed s surge in its prices.

 

Owing to extremely low transaction fees and patronage of Musk, the crypto is increasingly being used by numerous companies as a payment option.

Stellar

Created in 2015, Stellar is a peer-to-peer (P2P) decentralized network, with XLM or Lumens as its in-house token.

This crypto is increasingly being used by firms in cross-border transactions, as its supports multi-currency transactions, and the platform is designed to move financial resources swiftly and reliably at a minimal cost.

Fantom

Fantom is an open-source decentralised smart contract platform for dApps and digital assets. Its native token is known as FTM.

Its key strengths are its performance and efficient transaction processing, for it can process thousands of transactions per second. Further, the crypto offers higher scalability but at a lower cost. Moreover, the crypto also features on-chain governance where users vote with FTM tokens.

The crypto can be bought and sold on several renowned crypto exchanges like Binance, Coinbase, Kraken, Upbit, and Huobi, etc.