Investing in cryptocurrencies: an easy guide to getting to know them and building your portfolio 💼

An appreciated reader asked me to share my opinion on the cryptocurrencies that, in my experience, are least likely to generate losses. This topic can be delicate, as not all coins or tokens fit this criterion, and some may feel excluded by not seeing their preferences reflected in the list. However, my goal is clear: to provide you with a clear and simple guide so that you can understand what cryptocurrencies are, which ecosystems and tokens are the most robust, and how these have demonstrated high growth potential and resilience even in times of market downturns. Behind each of these projects are human teams working tirelessly, giving them a competitive edge over other more volatile and less useful options.

In this article, I will show you how information is power. Knowing the most important details of the crypto world will allow you to reduce your exposure to risks, especially when investing in inflationary coins that, as we have seen over the years, end up being delisted from platforms like Binance (the largest exchange in the world) and disappear without a trace, taking the money of unsuspecting investors with them. My mission is to educate and guide, regardless of whether they invest a hundred dollars or a hundred thousand. Everyone deserves the same consideration and treatment because in this volatile market, every decision counts.

Furthermore, I will talk about how market manipulation, driven by large capital and influential actors, can affect prices and generate historic losses. This is not just theory; it is a reality we have seen in recent events, such as the excessive rise in the value of shares of war companies, driven by political leaders who prioritize economic interests over human life. This context reminds us of the importance of investing with knowledge and caution.

In this first part, I will give you an overview of the most reliable crypto ecosystems, such as Bitcoin, Ethereum, Binance Coin, Solana, and Polkadot, and I will explain the difference between coins and tokens. I will also show you how to identify projects with finite supply, which tend to be more deflationary and secure, compared to those with infinite supply, which are usually more inflationary and risky. In the second part, I will provide a detailed list of the coins and tokens that, in my opinion, have the greatest potential to multiply your investment and avoid losses.

So, my invisible friends, get ready to dive into a world full of opportunities, but also risks. My commitment is to be honest, clear, and educational because nothing gives me more satisfaction than helping you make informed decisions that improve your lives and those of your loved ones. Let's get started!

I part (getting to know the coins)

Creating a list of cryptocurrencies that are solid, resilient, have growth potential, a future, do not devour your investment, and leave you bankrupt or with losses is a complicated task. Listing coins and tokens that, in my opinion, are of high value can be in some way harmful and offensive to those who do not see themselves reflected in the list. Let's start with what logically everyone should know, which is that there are coins and tokens whose volatility is much lower, and their gains in a correction can be smaller, like in the case of CARDANO. Cardano has its own ecosystem, which includes its native blockchain and its cryptocurrency ADA. This ecosystem is designed to support decentralized applications, smart contracts, and secure transactions. Cardano uses a research-based approach reviewed by peers and its Ouroboros Proof-of-Stake consensus algorithm. This makes Cardano special but not very capable of generating high prices, making it unique in the world of cryptocurrencies. Although its price exceeded one dollar with some cents after it was mentioned that it could be included within the U.S. federal reserve, it generally moves within the same range.

What makes a coin resilient is, to a large extent, the technology of its ecosystem, making it capable of providing space for other projects that incorporate tokens. Thus, the greater the technology, the greater the security, less gas expenditure, and less money to spend for each transaction. On the other hand, there is adoption; a coin that has been adopted by institutions and large corporations for its use, like XRP, will be more stable and less volatile. In another aspect is the number of pieces: coins for large projects like Bitcoin and Ethereum, and tokens for projects that survive within ecosystems, like Solana, to name just one example. In the world of cryptocurrencies, the terms 'coins' and 'tokens' have specific meanings, and their use depends on the context and the purpose of the project.

Here are the coins that have their own ecosystem.

Like Cardano, there are several cryptocurrencies that have their own ecosystem and are safer when it comes to putting our money. I will give you a brief overview of how they work, in a comprehensible and manageable way so that you don't get confused. Here are my preferred ecosystems:

1. Bitcoin (BTC): It is used as a decentralized payment system and store of value.

2. Ethereum (ETH): Ethereum has a robust ecosystem that supports smart contracts. It is the basis for many tokens and projects in the crypto world.

3. Binance Coin (BNB): Native to the Binance Smart Chain, BNB is used for transactions within its ecosystem, which includes DeFi, NFTs, and more.

4. Solana (SOL): Solana has its own high-speed and low-cost blockchain, ideal for decentralized applications and NFT projects.

5. Polkadot (DOT): Polkadot connects multiple blockchains in its ecosystem, allowing interoperability between different networks. That is, it is the bridge or wormhole between ecosystems like the ones I mentioned earlier.

Obligatory question: But who uses coins and who uses tokens?

The first thing you should know, my invisible friends, is that from now on you need to understand that coins are the native cryptocurrencies of a blockchain, such as Bitcoin (BTC) on the Bitcoin blockchain or Ethereum (ETH) on the Ethereum ecosystem or Litecoin (LTC). They allow mining on their network, so you can not only mine Bitcoin but also Ethereum (ETH), to name just one example.

So then, what shall we call tokens? Obligatory question. Tokens are digital assets created within an already existing blockchain, meaning they use the ecosystem of Ethereum, BNB, or Solana to exist. They typically represent some type of value or utility for payments or, in the case of 'Pupucoins', without any purpose beyond speculation. Some ecosystems like Solana benefit from the liquidity that Pupucoins bring, which is why they lose credibility and their artificially inflated price collapses when the bubble bursts. When this happens, the owners of Solana and those who bought Pupucoins and got trapped lose their money and have to cry to the river. Tokens, and here I will use some slightly unusual terms I've already explained, can be fungible or non-fungible.

A fungible token is like glass marbles. If you have a blue marble and someone else has another identical blue marble, both are worth the same and can be exchanged without any problem. It doesn't matter which one you have because they are identical in value and appearance. I'll give you a real example: think of money. A five-dollar bill is worth the same as another five-dollar bill. See how simple that is? That's a fungible token.

Now I will explain what a non-fungible token (NFT) is. It's like a super special card from a collection, like a card of your favorite baseball player. That card is unique, and there is no other like it. Even if someone else has a different card, yours has special value because it may be rare, have something unique, or be part of a limited edition. A real example to help you understand: imagine a digital artwork that someone created, like a drawing of a kitten wearing glasses. There is only one official version of that drawing that has a digital certificate saying 'this is unique.' In short, fungible tokens are all the same and can be exchanged without issue. Non-fungible tokens are special, unique, and cannot be exchanged for another identical one.

Here are some examples of tokens that can be considered reliable and powerful to start answering the reader's question about how to build a reliable portfolio:

Reliable fungible tokens, in my humble opinion:

1. Chainlink (LINK): This token is used for smart contract services.

2. Tether (USDT): Who doesn't know it? It is the stable coin used as a digital representation of the dollar.

3. Uniswap (UNI): Governance token for the Uniswap protocol.

4. Aave (AAVE): This token is used for decentralized lending.

At the end of the article, I will list all the fungible and non-fungible tokens that are healthy and reputable, without this meaning that they are immune to the disease of greed.

Among non-fungible tokens or (NFTs), I will mention as a teaser

1. Axies in Axie Infinity: Unique creatures used in the blockchain game.

2. Decentraland: Unique virtual properties in the metaverse.

To conclude this first part of reliable, healthy coins and tokens and how they work, I will talk about a fundamental feature when choosing a coin or a token, and by this, I mean those with finite supply, which are those that have a finite supply, you can see this in the characteristics of each coin or token, for example, Ejective has and will always have 100 million pieces until the end of time, meaning a finite number of pieces or tokens created, and no more than the already created will be issued. Among the coins, the most well-known example is Bitcoin, which has a maximum supply of 21 million coins. They are also known as deflationary cryptos, as their scarcity tends to increase their price over time if demand remains or increases.

The others are the most dangerous, where I never put my money, are the cryptos with a large number of circulating or circulating or about to circulate coins or tokens. These cryptos have a very high supply, and part of the coins may be 'held back' to be gradually released to the market in the future. This can influence the price due to inflation. As I said here personally, because everyone is free to decide where to put their money, I will give some examples, and in the second part of this article, I will list all the coins on BINANCE with finite and infinite coins or tokens. A well-known example of a coin that generates unlimited tokens are Dogecoin and Ripple (XRP). For this reason, they are called inflationary coins or tokens, as their supply continues to grow over time.

It's important to mention that some cryptos implement a burning mechanism, in which units are intentionally removed from circulation. This decreases the total supply, with the goal of increasing scarcity and, theoretically, the price. Some examples that usually burn their coins or tokens are Binance Coin (BNB) and Shiba Inu (SHIB), both have regular burning strategies to manage the supply of coins in the case of BNB and its tokens in the case of Shiba Inu.

This is the end of the first part of the coins that I personally recommend. You should know that I haven't listed them yet, but from what I've written, you can already start to have an idea of where to put your money. See you very soon, my invisible friends.