Top Cryptos To Watch As The Blockchain Hits $1 Trillion Again - Our Picks
As cryptos move higher depending on the monetary policy reversal speculation, the market becomes more unpredictable. This means investors should be approaching the market with great caution. So, here are 5 cryptos to watch as the blockchain hits $1 trillion again.
Bitcoin (BTC) - BTC may be resilient, but ephemeral spikes are pretty usual now.
Ethereum (ETH) - This coin is showing positive gains, but it has ultimately done better before.
Tether (USDT) - Given the greenback rising, USDT shows relevancy concerns.
BNB (BNB) - This one’s been impressive so far, but investors should keep their perspective in check.
Cardano (ADA) - The coin is yet to breach the 200 DMA.
A Closer Look At 5 Cryptos To Watch As The Blockchain Hits $1 Trillion Again
Bitcoin (BTC)
The price of Bitcoin has been increasing rapidly and currently stands at around $20k. At the beginning of the year, it was trading for less than $17k. Some investors who bet against the trend have made 35% returns in just a few weeks. Now, the real question is whether they should sell their investments or hold on to them in hopes of even more gains.
It’s remarkable how resilient Bitcoin and other cryptos alike are, even in the face of adverse developments such as the bankruptcy of Genesis Global Capital, a digital asset lender. Instead, the main factor driving the crypto market is likely the Federal Reserve's monetary policy. If the Fed changes its strategy and loosens its grip, Bitcoin could experience a significant increase in value.
It's crucial to maintain a sense of perspective when considering a Bitcoin investment. In the past, even after a significant drop in value, the price of Bitcoin has temporarily risen by around 32% before falling again. For this ongoing race to be sustainable, the rally must run for over a month. Otherwise, the market may experience a decline.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Ethereum (ETH)
Ethereum is another crypto that has been impressing investors. It kickstarted the year at around the $1000 mark and currently trades at about $1,600, thus, providing a return of 36% in less than a month. Additionally, technical analysis shows it is now above its moving averages of 50 and 200-day, which is a positive sign.
Like other major cryptocurrencies, Ethereum was able to weather the bankruptcy of Genesis Global Capital. However, the attention is now placed on the Shanghai hard fork, an upcoming event planned for release in March 2023. This protocol update can enable the withdrawal of staked Ether (ETH) on the Beacon Chain. Additionally, Ethereum developers have developed a "shadow fork" to test the upgrade before it goes live in Shanghai.
Despite the positive outlook for Ethereum, investors should be aware that in 2018, it doubled in value between April and May before experiencing a significant decline. Therefore, investors must remain cautious and avoid investing too heavily in Ethereum or other cryptocurrencies.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Tether (USDT)
Tether (USDT) is a stablecoin that is pegged to the value of the U.S. dollar and does not fluctuate much in value. In the past, holding Tether for the long term made sense as the dollar's purchasing power decreased. But with the current shift in Federal Reserve policy, many, if not all, crypto investors should remain cautious about moving forward with tether.
For example, while writing this, Tether has only gained a 0.048% increase in market value since the beginning of the year, while the purchasing power of the dollar has grown by 0.30% between November and December of 2022. As a result, holding onto cash can provide a higher return than investing in Tether.
While Tether allows for a quick purchase of cryptos, the uncertain stance of the Fed on reducing interest rates makes investing in virtual currencies a risky move. Additionally, the failure of other stablecoins adds to the caution investors should take when considering investing heavily in USDT.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
BNB (BNB)
Despite the recent bankruptcy of competing virtual currency exchanges, Binance's cryptocurrency, BNB (BNB), has managed to maintain its value and even increase in recent weeks. In the past week, it has gained around 7% in market value.
From the technical analysis perspective, the current price is above its 50 and 200-day moving averages. At the beginning of the year, the coin was trading at about $200, and now it runs at a valuation of around $320, thus, displaying a 32% value increase.
Despite its impressive performance, investors need to remember that BNB had a recovery rally before in 2018, gaining 116% of its market value between March and June. While the current 32% return is noteworthy, it's important to consider historical patterns and maintain perspective when making investment decisions.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Cardano (ADA)
Despite the positive performance of other cryptocurrencies, there is some cause for concern with Cardano’s recovery rally. While Cardano has seen strong growth, rising from $0.25 at the beginning of January to nearly $0.38 currently, thus, representing a 52% return, investors should still approach with caution.
Some potential investors may be concerned that Cardano has not yet surpassed its 200 DMA, despite being close. The 200 DMA (Displaced Moving Average) is currently at 40 cents, while Cardano (ADA) is trading at 38 cents, which is a 5% difference. While this may not be significant in the crypto world, it is notable because many other non-stablecoin digital assets have exceeded their 200 DMAs.
Despite the impressive performance of Cardano in recent times, it has yet to breach its 200 DMA (Displaced Moving Average). Additionally, it has performed better in the past, with around 140% return between April-May of 2018. Investors need to keep this in mind and have a balanced perspective when considering investing in Cardano.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
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