Cryptocurrency Selection Guide: Mastering the Core Logic of Mainstream Coin Investment

In an era of increasing volatility in financial assets, besides traditional hedging tools, cryptocurrencies have become an important option for asset allocation due to their high liquidity and trading convenience. However, faced with thousands of cryptocurrencies, investors often fall into a dilemma of choice. This article will analyze the key factors of cryptocurrency investment recommendations, organize the leading mainstream coins by market cap, and share practical trading strategies.

The Three Logical Choices in Cryptocurrency Investment

Bull and bear cycles determine strategic direction

There is a classic saying in the crypto market: In a bull market, chase potential coins; in a bear market, stick to mainstream coins. This logic is not unfounded but is based on deep market dynamics.

During bull markets, capital flows out seeking higher returns, and altcoins, with relatively smaller liquidity, are easily driven by funds to rise rapidly. In contrast, mainstream coins, with large market caps, have limited upside potential. But the situation reverses in bear markets—market risk aversion rises, and capital concentrates into the largest, most resilient mainstream coins, while altcoins face the risk of zeroing out, leading investors to significantly reduce holdings or sell off completely.

Therefore, the first step in choosing cryptocurrencies is to determine the current market cycle stage. Then, evaluate the coins across dimensions such as popularity, trading depth, liquidity, volatility characteristics, and practical application.

Mainstream coins vs. Altcoins: The Essential Difference

The top ten cryptocurrencies by market cap are generally classified as mainstream coins. They attract more attention not only because of their size but also because these projects have been market-verified and have a leading demonstration effect.

In contrast, cryptocurrencies outside the top ranks are collectively called altcoins. Historically, several altcoins have briefly entered the top ten (such as Filecoin, Luna, Polkadot), but ultimately fell out due to changing market narratives and weak fundamentals. The lessons from these coins are clear—high risk, high volatility, and a high likelihood of zeroing out.

From a safety perspective, mainstream coins are more suitable for long-term holding over 4 years, as they demonstrate relative resilience in each full bull-bear cycle.

Market Cap Rankings Interpretation: The Current Mainstream Ecosystem

Based on market data (as of end of 2025), the crypto market landscape is as follows:

Note that these rankings are not fixed permanently but fluctuate with market dynamics. Some cryptocurrencies may rise or fall rapidly due to narrative shifts. Therefore, diversification is more prudent than betting on a single coin.

Recommended Cryptocurrency Investment Picks to Watch

1. Bitcoin(BTC) — The Foundation of Crypto Assets

BTC, as the first decentralized crypto asset, still dominates the market with a market cap accounting for over half of the entire crypto sector. Since the approval of spot ETFs in 2024, institutional funds have continuously flowed in, pushing prices higher.

BTC’s core value lies in its absolute scarcity—a fixed total supply of 21 million coins, halving approximately every four years, with an inflation rate not exceeding 0.80%. This deflationary mechanism makes it a powerful tool against fiat currency devaluation.

Investment value: Suitable for conservative investors; a fundamental asset in crypto portfolios.

2. Ethereum(ETH) — The King of Application Ecosystems

Ethereum’s advantage is not based on a single metric but on its rich application ecosystem. The smart contract functionality has attracted thousands of projects deploying on its platform, with a TVL (Total Value Locked) reaching $93.1 billion, leading all public chains.

ETH’s trading volume often reaches 60-70% of BTC’s, reflecting market recognition of its liquidity. The launch of spot ETFs further consolidates its institutional asset status.

Investment value: Combines long-term appreciation potential with short-term trading liquidity, making it a core component of crypto portfolios.

3. TAO Coin — Beneficiary of the AI Boom

With explosive growth in artificial intelligence technology, AI×Blockchain integration has become a new narrative focus. TAO coin is born from this trend.

The Bittensor network aims to create a peer-to-peer machine learning service marketplace, where users can buy AI model services with TAO. Interestingly, TAO’s design draws inspiration from BTC—also with a fixed supply of 21 million coins and a gradual deflationary mechanism.

Investment value: Benefits from the AI industry hype, but attention should be paid to technological progress and market adoption.

4. XRP( — Institutional-Grade Infrastructure

Ripple, the company behind XRP, has established extensive partnerships with governments and financial institutions worldwide, boosting XRP’s market recognition.

In transaction efficiency, XRP has a clear advantage—its theoretical throughput reaches 1,500-3,400 transactions/sec, with stable real-world operation at 500-700 TPS, far surpassing BTC’s 7 and Ethereum’s 15-30 transactions/sec. This makes it an ideal choice for institutional cross-border payments.

Investment value: Policy-friendly, suitable for investors seeking policy benefits.

) 5. Solana###SOL( — High-Performance Public Chain

SOL is nicknamed the “Ethereum Killer” in the market, with core advantages of extreme transaction efficiency and low costs.

Through parallel transaction processing and other technologies, SOL’s throughput can reach 65,000 transactions/sec, with stable real-world operation at 3,000-4,000 TPS, and an average transaction fee of only $0.00025, offering a high cost-performance ratio.

Investment value: Suitable for investors optimistic about public chain competition and high-performance applications.

) Additional Recommendations

Chainlink###LINK(: Its unique strength lies in connecting blockchain with real-world data. Its Oracle network provides off-chain data access for smart contracts, serving as an important infrastructure component. Unlike meme coins, LINK has real functionality within the network, with clear market demand.

Dogecoin)DOGE( and The Open Network)TON(: The former continues to attract attention due to community strength and endorsements from industry figures; the latter is backed by the Telegram ecosystem and has unique application scenarios.

The Role of Stablecoins

Among the top ten by market cap, USDT and USDC are stablecoins, pegged to the US dollar, with minimal fluctuations (usually less than 1%). Because of their limited volatility, stablecoins are mainly used for capital reserves and liquidity management, not for appreciation.

If your goal is to generate investment returns, focus on non-stablecoins like BTC, ETH, XRP, SOL, DOGE, which show obvious appreciation potential in each bull market.

Practical Trading Strategies for Cryptocurrency

) How to start trading?

The most common way is to choose a centralized exchange:

1. Register an account and complete identity verification
2. Link payment methods
3. Use fiat to buy stablecoins like USDT
4. Exchange target cryptocurrencies in the trading pairs

BTC and ETH can be directly purchased with fiat; other coins usually require buying stablecoins first and then swapping.

OTC trading as an alternative

If platform operations are cumbersome, consider OTC trading, but be sure to verify the trustworthiness of the counterpart, preferably face-to-face trading to mitigate risks.

Long-term holding vs. short-term trading

Advantages of long-term holding:

• Simple operation, suitable for beginners
• Low transaction fees
• Avoiding psychological stress from frequent decisions
• Locking in gains during bull markets

Challenges of long-term holding: Watching price fluctuations without panic is a test. It’s recommended to transfer assets to a wallet for physical isolation, reducing impulsive selling. Also, establish clear trading goals and stop-loss points, managing long- and short-term funds on different platforms or accounts.

Opportunities in short-term trading: Mainstream coins in the top ten, due to deep liquidity and difficulty of manipulation, are suitable for short-term swing trading. Conversely, small-cap altcoins are often controlled by project teams or exchanges, making ordinary investors prone to liquidation.

Five Investment Mistakes to Avoid

Mistake 1: Being fooled by coin prices

Many beginners see a coin priced at just a few cents and imagine it will skyrocket to a dollar for quick wealth. But, low price does not mean high potential; in fact, low-priced coins often carry higher risks. Focus on market cap rather than price alone.

Mistake 2: Ignoring market cycles

Holding onto altcoins during bear markets or rushing to buy only in bull markets are common timing errors. Learning to identify market cycles is crucial.

Mistake 3: Over-concentrating investments

Putting all funds into a single coin violates basic risk management principles. Even with relatively safer mainstream coins, proper diversification is necessary.

Mistake 4: Neglecting security measures

No matter how much profit, it cannot compare to the loss from being hacked. Protect account passwords, private keys, and seed phrases as fundamental requirements.

Mistake 5: Frequent stop-loss and take-profit

Constantly cutting losses or locking in small profits amid volatility will ultimately lead to losses due to fees and psychological wear. Long-term investing requires patience.

Which cryptocurrencies should you choose?

Conservative investors: Focus on BTC and ETH, the two largest and most consensus-driven coins. The risk is lowest, but appreciation potential is relatively limited.

Growth-oriented investors: Besides BTC and ETH, add DOGE, ADA, SOL, etc., aiming for higher growth. This requires basic market understanding and tolerance for larger fluctuations.

Aggressive investors: Include all the above mainstream coins and carefully selected altcoins. But note that MEME coins and other ultra-high-risk assets are not within this recommendation scope because they rely solely on hype, with unpredictable risks.

Regardless of the strategy chosen, the most important thing is to clarify your investment goals, set stop-loss boundaries, and avoid holding trash coins long-term. Winners in the crypto market are often not those who pick the best coins but those who stick to the right strategies.