Coins To Catch: Navigating The Crypto Investment Landscape

There are thousands of different cryptocurrencies, which can make it challenging to know where to start when investing in crypto. Bitcoin is the most well-known cryptocurrency, but there are many others that are also worth considering for investment, such as Ethereum, Tether, Binance Coin, Cardano, and Dogecoin.

When it comes to investing in coins, there are two main types to consider: bullion coins and numismatic coins. Bullion coins are valued primarily for their metal content, usually gold or silver. They are a good option for investors who want to focus on the intrinsic value of the metal. On the other hand, numismatic coins, or rare coins, are valued for their collector appeal and historical significance. These coins may have a higher premium but can be a good investment if you are knowledgeable about coin values and can recognise undervalued assets.

Rare coins as an investment

Rare coins can be a very profitable investment, but it is important to do your research and be aware of the potential risks. The value of a coin is derived from two main sources: its bullion value and its collector or numismatic value.

Bullion value refers to the physical metal contained in the coin. Many collectible coins are made from precious metals such as gold or silver, giving them intrinsic value as stores of these metals. The bullion value can be calculated by multiplying the number of ounces of metal in a coin by the spot price per ounce of that metal.

The second source of value is the collector or numismatic value, which applies mostly to antique and rare coins. This value is harder to determine and depends on factors such as buyer sentiment, scarcity, and the coin's condition. The fewer examples of a coin that were minted, the higher its collector value is likely to be due to limited supply. Coins that are in uncirculated condition or close to it will also command higher prices from buyers who value their numismatic appeal.

When investing in rare coins, it is important to consider both the bullion and numismatic value. Modern bullion coins, such as Canadian Maple Leaf silver coins and American Gold Eagles, are a great way to invest in precious metals while also owning handsome coins. Older coins, such as American quarters and dimes minted before 1965, can also be good stores of bullion value and may have some numismatic value as well.

For those interested in the numismatic value of coins, it is important to know which coins will be most in demand among collectors. Rare dates, mint marks, and minting errors can all add to a coin's value. Certified coins, which have been inspected and graded by a recognized organization, are typically more sought-after by collectors. It's also important to beware of counterfeits and only purchase rare coins from reputable dealers.

In addition to their investment potential, rare coins offer the opportunity to own a piece of history and engage with different periods of the past. Whether you're a beginner or an advanced collector, it's important to do your research and keep up to date with the latest coin values and market trends.

Coins with bullion value

The United States Mint first started producing bullion coins in 1986 with their American Gold Eagle and American Silver Eagle series. Today, the U.S. Mint produces a variety of coins with a high content of gold or silver, which are marketed directly by the Mint or by its authorized resellers. Older coins can also be good stores of bullion value, such as American quarters and dimes minted before 1965, which contain 90% silver.

Some examples of bullion coins include:

• American Gold Eagle (1986-Present)
• American Platinum Eagle (1997-Present)
• American Silver Eagle (1986-Present)
• Gold Buffalo (2006-Present)
• Ultra High Relief $20 Gold (2009)
• High Relief $100 Gold (2015)
• Canadian Maple Leaf silver coins
• American Gold Eagles
• South African Gold Krugerrands
• Austrian Gold Philharmonics
• Somalian Gold Elephants
• Australian Gold Coins
• Australian Gold Lunar
• Perth Gold Kangaroos

Coins with numismatic value

Coin collecting can be a profitable venture when done right. The value of a coin is derived from two main sources: the physical metal contained in the coin (bullion value) and its collector or numismatic value. The latter is harder to determine and depends on buyer sentiment. However, certain guidelines can help identify coins with high numismatic value.

The numismatic value of a coin is influenced by factors such as rarity, minting errors, and condition. The fewer examples of a coin that were minted, the higher its collector value due to scarcity. Rare minting errors can also increase a coin's worth. Additionally, coins in better condition tend to command higher prices from buyers who value their numismatic appeal.

Some coins are predominantly numismatic investments, with their value determined primarily by their scarcity and collector demand. These include rare dates, mint marks, and certified coins that have been inspected and graded by recognised organisations.

For those interested in investing in coins with numismatic value, it is important to consider the following:

• Focus on bullion value initially: Investing in modern bullion coins, such as Canadian Maple Leaf silver coins and American Gold Eagles, is a great way to start. These coins contain high-grade gold or silver, making them excellent precious metal investments, while also being visually appealing.
• Older coins with bullion value: Some older coins, such as American quarters and dimes minted before 1965, contain high percentages of silver and are often purchased by coin investors for their metal content.
• Borderline bullion and numismatic investments: Coins like American silver dollars are common enough that they don't have very high collector value, but they sell for prices higher than their raw bullion value. These coins hold their value reasonably well and are fun to collect due to their historical appeal.
• Numismatic investments: If investing purely for numismatic value, look for rare dates, mint marks, and certified coins. A good example is the 1950-D Jefferson nickel, which can sell for $70 or more in uncirculated grades, despite its low face and bullion values.
• Recognise undervalued assets: Knowledge of coin values can help identify bargains at estate sales, antique stores, and swap meets. Additionally, learning to interpret precious metals market movements can optimise purchase timing.

Cryptocurrencies as an investment

Cryptocurrencies are digital currencies that use cryptographic techniques to create and process money. They are designed to be free from government control and manipulation and are often based on blockchain technology.

There are thousands of different cryptocurrencies, and they can be a good investment opportunity. However, it is important to remember that they are not regulated and can be extremely volatile.

Bitcoin (BTC)

Bitcoin is the original cryptocurrency, created in 2009 by Satoshi Nakamoto. It runs on a blockchain, a ledger logging transactions distributed across thousands of computers. As of July 23, 2024, a single bitcoin is worth around $66,506, a growth of 13,201% since May 2016.

Ethereum (ETH)

Ethereum is both a cryptocurrency and a blockchain platform. It is a favourite of program developers due to its potential applications, such as smart contracts and non-fungible tokens (NFTs). As of July 25, 2023, Ethereum's market cap was almost $199 billion, with one ETH valued at around $1,652.

Tether (USDT)

Tether is a stablecoin, meaning its value is tied to fiat currencies like the US dollar. This makes its value more consistent than other cryptocurrencies, and it is favoured by investors wary of volatility. As of July 22, 2023, Tether was the third-largest cryptocurrency by market capitalization, with a value of $1.00 per token.

Binance Coin (BNB)

Binance Coin is a cryptocurrency that can be used to trade and pay fees on the Binance exchange, one of the largest crypto exchanges in the world. It can also be used for payment processing and travel arrangements. As of July 22, 2023, one BNB was valued at around $584.

Solana (SOL)

Solana is a blockchain platform that supports decentralized applications (DApps) and smart contracts. It processes transactions quickly and securely using a hybrid proof-of-stake and proof-of-history mechanism. Its native token, SOL, has seen tremendous growth since its launch in 2020, increasing in value by 22,614% by July 2024.

Cardano (ADA)

Cardano is an "Ouroboros proof-of-stake" cryptocurrency created by engineers, mathematicians, and cryptography experts. It stands out among its peers due to its rigorous research-based approach and extensive experimentation. As of July 22, 2023, Cardano had a market capitalization of $10.9 billion, with one ADA valued at around $0.31.

Other notable mentions

Other cryptocurrencies worth mentioning include XRP, USD Coin, Dogecoin, and Polygon (MATIC).

Altcoins

• Ethereum (ETH): The biggest altcoin on the market, Ethereum is a distributed computing network where users can run decentralised applications and host smart contracts. Its native token, ether, is used to pay for transaction fees and as collateral for validators and block proposers.
• Binance Coin (BNB): BNB is a utility token that can be used to pay for trading fees and get discounted trades on the Binance exchange. It can also be used outside the exchange for payment processing, such as booking travel arrangements.
• Solana (SOL): Solana is a blockchain designed to power decentralised finance, apps, and smart contracts. It runs on a unique hybrid proof-of-stake and proof-of-history mechanism to process transactions quickly and securely.
• Ripple (XRP): XRP is used to facilitate exchanges of different currency types with digital technology and payment processing company Ripple Labs. Its XRP Ledger offered the first-ever decentralised exchange, with a protocol allowing for custom tokenisation.
• Dogecoin (DOGE): The original meme coin, Dogecoin was started as a joke in 2013 but has since evolved into a prominent cryptocurrency thanks to a dedicated community and creative memes.
• Toncoin: Developed in 2018 by Telegram, Toncoin is a Layer-1 blockchain that enables in-application clients to easily settle transactions within the Telegram app. It has since grown into a community-driven blockchain with extremely fast processing and validation times.
• Cardano (ADA): Cardano was an early adopter of the proof-of-stake consensus mechanism, which speeds up transaction times and reduces energy consumption.
• Shiba Inu (SHIB): Developed in 2020, Shiba Inu is an Ethereum-based meme coin. It was created by an anonymous developer who claimed that the goal of the coin was to discover if an organisation could work without central leadership.
• Avalanche (AVAX): Avalanche is a layer-one blockchain for decentralised apps and other networks. It is a rival to Ethereum and is looking to unseat it as the blockchain of choice for smart contracts by prioritising higher transaction output without sacrificing scalability.
• Tron: Tron is a decentralised blockchain and cryptocurrency founded in Singapore in 2017. It has since grown into a fully decentralised autonomous organisation with more than 167 million accounts.

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