Breaking Down the Top 5 Cryptocurrencies by Market Cap: How They Differ and Why

A guide to the leading cryptocurrencies for beginner crypto investors

Fact checked by Vikki Velasquez

Cryptocurrencies have exploded in popularity over the past decade, with the total market valued at roughly $2.76 trillion as of April 14, 2025, up from around $3.6 billion on April 14, 2015. But with thousands of digital coins in circulation, it can be overwhelming for new investors to figure out where to begin.

One way to cut through the noise is to focus on the top cryptocurrencies by market capitalization, which have earned their position through a combination of widespread adoption, technical innovation, and staying power. Below, we explore each of the top five, what they have to offer, and how they differ.

Key Takeaways

• Market capitalization can help you assess a cryptocurrency’s relative size, popularity, and influence.
• Bitcoin remains the dominant cryptocurrency by far and is often compared to gold for its potential as a store of value.
• Altcoins typically derive value from unique technological features that impact their specific use cases.
• Ethereum powers smart contracts, Tether offers price stability, XRP facilitates cross-border payments, and Binance Coin fuels activity on the world’s largest crypto exchange.
• New crypto investors should consider whether they prefer technical or fundamental analysis and use Bitcoin as a benchmark when evaluating altcoins.

Understanding Market Capitalization in Cryptocurrencies

Market capitalization, or “market cap,” is a metric you can use to determine the total market value of a cryptocurrency. To calculate it, multiply the current price of a coin or token by its total circulating supply.

For example, if a cryptocurrency has 10 million coins in circulation, each worth $10, its market cap is $100 million.

Market cap is useful for measuring a cryptocurrency’s size and market share, providing insight into its position within the broader crypto landscape. A bigger market cap can signal higher investor confidence, more widespread adoption, or greater influence. Market cap can also help you identify trends in the cryptocurrency market as a whole, such as expansion, contraction, or diversification.

As of April 14, 2025, the top five cryptocurrencies by market cap are:

• Bitcoin
• Ethereum
• Tether
• XRP
• Binance Coin

1. Bitcoin

Note

As of April 14, 2025, the market capitalization of Bitcoin is roughly $1.7 trillion, with a price per coin of about $84,500, and a dominant market share of around 61%.

Bitcoin (BTC) is the undisputed leader of the cryptocurrency market, with the largest market cap in the asset class by a wide margin. Often referred to as “digital gold,” BTC is prized for its scarcity, decentralization, and resilience. It has no publicly known central creator or organization behind it, and its total supply is permanently capped at 21 million coins.

Bitcoin also has the longest-running and most secure blockchain, with no successful hacks since its launch 16 years ago. Because of its dominant track record, Bitcoin is a common entry point for new investors in the cryptocurrency asset class.

“It is very different from the rest of the class,” said Bryan Courchesne, founder and CEO of DAIM, a registered investment advisor (RIA) dedicated to crypto.

“Bitcoin has the longest, most trusted network. The creator is removed, and there’s truly a fixed supply. It’s a rare asset and has the largest market cap by far.”

Important

Every cryptocurrency other than Bitcoin is referred to as an altcoin, short for alternative coin.

2. Ethereum

Note

As of April 14, 2025, the market capitalization of Ethereum is roughly $196.1 billion, with a price per coin of about $1,620.

Ethereum (ETH) is the second-largest cryptocurrency by market cap and is well known for its dual purpose. In addition to supporting its own native cryptocurrency, ETH, also known as Ether, the platform is designed to facilitate decentralized applications (dApps).

dApps are programs that run on a blockchain instead of a centralized server. They’re powered by smart contracts, self-executing bits of code that automatically carry out actions when specific conditions are met. Smart contracts are Ethereum’s most significant innovation, though the idea technically predates the platform.

While Bitcoin focuses on being a store of value, Ethereum was designed to help developers build dApps for everything from finance and gaming to non-fungible tokens (NFTs). ETH is the currency that fuels the system, allowing you to pay for transactions on the Ethereum network. However, it’s also widely held and traded, like Bitcoin.

3. Tether

Note

As of April 14, 2025, the market capitalization of Tether is roughly $144.3 billion, with a price per token of about $1.00.

Tether (USDT) is the third-largest cryptocurrency by market cap and the most widely held stablecoin, which is a type of cryptocurrency designed to maintain a stable value. In Tether’s case, each token is pegged to a matching fiat currency, such as the U.S. dollar. As a result, one USDT should always be worth $1. “Tether is what you might call the closest thing to a pure cryptocurrency,” said Courchesne.

Tether helps traders and investors move money through the crypto ecosystem without exposure to the extreme price swings that are common in other cryptocurrencies. It often serves as a trading pair, acting as the other half of a trade when buying or selling cryptos like BTC or ETH. It’s also a valuable bridge between fiat and crypto markets.

To maintain its value, Tether only issues new USDT tokens when users deposit U.S. dollars or equivalent assets into its reserves, which are primarily held in a mix of cash and cash equivalents. In theory, that ensures every Tether token in circulation is supported by real-world value.

4. XRP

Note

As of April 14, 2025, the market capitalization of XRP is roughly $124.2 billion, with a price per coin of about $2.15.

XRP (XRP) is the fourth-largest cryptocurrency by market cap and the native cryptocurrency of the Ripple network. Ripple is a blockchain-based payment system designed to move money across international borders more efficiently than traditional methods, like the SWIFT banking system.

XRP facilitates international transactions by acting as a bridge between different fiat currencies. That means a bank in one country can use it to send value to another country without needing to hold reserves in the recipient country’s currency.

XRP’s primary differentiator is its decentralized settlement mechanism. It allows for near-instant, low-fee transfers across borders, making it especially useful for financial institutions and global payment providers.

5. Binance Coin

Note

As of April 14, 2025, the market capitalization of Binance Coin is roughly $85.3 billion, with a price per coin of about $585.

Binance Coin (BNB) is the fifth-largest cryptocurrency by market cap and the native token of Binance. Binance is the most widely used cryptocurrency exchange in the world, with an average daily trading volume of $65 billion.

Binance Coin (BNB) was originally launched as an ERC-20 token on the Ethereum network before migrating to its own blockchain. Its original purpose was to offer discounts in the Binance ecosystem. “If you held BNB, you paid lower trading rates on their platform,” said Courchesne.

BNB now plays a broader role, similar to Ether on the Ethereum network. You can use it to fuel smart contracts and pay transaction fees on the Binance Chain and Binance Smart Chain, which Binance developed to support crypto transactions and dApps. 

One of Binance’s unique features is its ongoing “token burn” process, in which the company regularly removes BNB from circulation. This deflationary mechanism permanently reduces the total supply over time, increasing the remaining tokens’ scarcity and potentially value.

Note

Despite being the world’s largest crypto exchange, Binance isn’t supported in the U.S. American residents must use Binance.US, a separate platform with fewer supported tokens and features.

Comparative Analysis

Each of the top five cryptocurrencies by market cap brings something unique to the table, whether it’s a distinct market positioning, a clever technical innovation, or a targeted use case. These differences help explain why the values of these cryptocurrencies vary so widely.

• Bitcoin is the most valuable cryptocurrency, largely due to its first-mover advantage. However, it’s also a highly effective store of value for many of the same reasons traditional fiat currencies are. For instance, the 21 million coin cap creates scarcity, and its market dominance makes it the most widely accepted cryptocurrency.
• Ethereum is Bitcoin’s closest competitor, known for its popularization of smart contracts and a programmable blockchain, which allows developers to build dApps on its network. Despite the significant gap in market cap between it and Bitcoin, Ethereum has become the most active blockchain in the world—measured by total value locked (TVL)—for its broad utility.
• Tether is a stablecoin pegged to 1:1 to fiat currencies like the U.S. dollar. Its purpose isn’t to grow in value but to maintain a stable price, provide liquidity for traders, and act as a bridge between fiat and crypto markets. Its consistency makes it ideal for holding funds, executing quick trades, and exiting volatile positions.
• XRP was designed specifically for cross-border payments. It’s especially useful for financial institutions and payment providers, offering fast settlement times and low transaction fees. Its value comes from its real-world utility and adoption by organizations looking to streamline international money transfers.
• Binance Coin is the native token of Binance, where it plays a similar role to Ethereum’s Ether. It allows you to cover transaction costs and pay trading fees at a discount. Its value comes from its utility in the world’s most popular crypto exchange and its token burn strategy, which helps increase its scarcity.

Investment Considerations

Before investing in crypto, consider whether you prefer technical or fundamental investing. Technical investors analyze price charts and pattern trends. In terms of chart patterns, “you’re looking for head and shoulders, Bart Simpsons, breakouts,” said Courchesne.

Fundamental investors focus more on a cryptocurrency’s underlying purpose, technological strengths, and long-term potential. “If you’re a fundamental investor, you ask, what are the forward stories? Where could the price go?”

Whatever your approach, Bitcoin is a useful benchmark as the most dominant cryptocurrency. On working with new investors, Courchesne said: “We make sure they have a little bit of basis in Bitcoin, and then we can look at altcoins. Everything should be priced versus Bitcoin. Do you think [an altcoin] will outperform? Because if not, you might as well just be in Bitcoin.”

It’s also crucial to protect yourself. Crypto remains a volatile, speculative, unregulated asset class. Focusing on the top five by market cap can limit your exposure to the projects most vulnerable to failure or fraud, but you can still experience losses or lose your assets altogether to theft or user error.

Courchesne warned against taking crypto advice from the wrong sources and using untrustworthy platforms. “Almost all of the time, those people giving you advice on social media platforms have an ulterior motive,” he said. “You need to be careful. Protect your investments. Work with reputable, big-name, U.S.-based, licensed companies.”

How Do Market Cap Fluctuations Affect Cryptocurrency Values?

A cryptocurrency’s market cap equals its current price multiplied by the number of coins in circulation. If the supply remains relatively stable, fluctuations in market cap reflect changes in the coin’s price. An increase may signal rising demand and investor confidence, while a decrease can indicate falling interest or broader market concerns.

Can I Lose Money in Crypto Even if I Stick to the Top Coins?

You can lose money in crypto even if you stick to the top coins by market cap. Bitcoin and the leading altcoins may be relatively well-established, with less chance of rug pulls or complete collapse, but they’re still risky. Even Tether, the least volatile of the group, isn’t entirely safe. It’s only as stable as its issuer, and broader market threats like harmful regulations can still impact it.

What Is the Safest Place To Buy Cryptocurrency?

It’s often safest to buy cryptocurrency from reputable, U.S.-based exchanges. These platforms are more likely to comply with regulations, prioritize transparency, and invest in strong security protocols. Some top options include Coinbase, Kraken, and Gemini.

The Bottom Line

Market capitalization is a simple but powerful way to gauge a cryptocurrency’s size and market position. For beginner investors, focusing on the top five cryptocurrencies by market cap can be a practical starting point, as they typically have stronger adoption and more robust infrastructure.

Bitcoin remains the clear leader, valued for its scarcity, security, and long track record. The top altcoins compete by offering innovative features. Ethereum powers smart contracts and dApps, Tether provides price stability, XRP enables cross-border transfers, and Binance Coin supports the world’s largest exchange.

Wherever you start, understand your investing style and risk tolerance. Use Bitcoin as a benchmark to help you evaluate other coins, and take precautions to protect your investments, like sticking to reputable platforms, securing your holdings, and avoiding advice from unreliable sources.