As an alternative to selecting cryptocurrencies by market cap, the best way to truly diversify your portfolio, for both value and growth purposes, may be to go about selecting cryptocurrencies by category. After you’ve flipped through the categories and selected the finalists that best fit your risk tolerance (see Book 5, ssss1), you can then move on to advanced investing techniques throughout the later chapters of ssss1.

Based on their popularity and total market cap as of 2021, here are some of the most popular cryptocurrency categories and the leading cryptos in each space. The following sections describe just a few examples of many categories in the exciting cryptocurrency world; you may recognize some of the currencies from their coverage earlier in this chapter. Other people may categorize these cryptos differently. Some popular cryptocurrency categories include the following:

 Gaming/gambling

 Supply chain

 Transportation

 Medical

 Internet of Things (IoT)

Payment cryptos are by far the biggest category in terms of total market cap. In this group, you find cryptocurrencies that mainly aim to be used as a store of value, transaction, and payments, just like fiat currencies such as the U.S. dollar. Examples of cryptocurrencies that fall into this category include the following: