iHodl reached out to several financial experts to find out which altcoins are worth investing in right now.
Victor Argonov, EXANTE analyst
The past week was an especially volatile one for the crypto market. Bitcoin (EXANTE: Bitcoin) crossed $19,000 on Tuesday, the last psychological milestone on the way to the old record of 2017. Bitcoin failed to reach it though. On Thursday, the cryptocurrency dropped at a minimum below $16,400. The total amplitude of the drop was approximately $3000. Nevertheless, by the end of the week, the BTC rate recovered to the levels of $18,000-$18,500, where it remained approximately at the beginning of the week. By the end of the week, the BTC rate dropped by only 2%. Some other coins of the top 10 showed a similar result: ETH + 0%, BCH -3%, BNB -1%. At the end of the week, some coins reacted to the market drop even more painfully than BTC: LTC -6%, LINK -10%, DOT -9%. On the other hand, others regained excellent growth performance, well ahead of bitcoin. We will talk about them next.
What crypto projects, despite the drop of BTC, managed to keep high growth at the end of the week?
- Bank payment systems Ripple (XRP, + 34%) and Stellar (XLM, + 86%). Claiming the same market niche, the both assets grow faster than others in this rally. At the same time, XLM is growing faster so far. Perhaps, it happens due to the fact that Ripple is a private centralized system, while Stellar is a decentralized one. XLM capitalization is six times lower than XRP capitalization, and now investors who value decentralization are more actively investing in XLM, gradually reducing the project lag.
- Coins with non-traditional mining principles other than PoW (Proof-of-Work): the Cardano smart-contract network (ADA, + 20%) and the Dash anonymous blockchain (DASH, + 17%) based on PoS (Proof-of-Stake), as well as NEM ( XEM, + 32%) based on PoI (Proof-of-Importance). In PoS, the reward is determined by the number of coins allocated to users for the so-called staking, and in PoI, it is also determined by the level of user activity.
- The above-mentioned anonymous coins dash (DASH, + 17%), as well as zcash (ZEC, + 6%), which has lagged behind its counterparts for a long time, but is now increasing its capitalization.
Alexander Kuptsikevich, Lead Analyst at FxPro
The decision to invest in altcoins amid the recent growth should be made based on the long-term plans. If investment plans are short-term ones, then the risk is very high. It is very likely that altcoins will storm heavily in both directions in the coming weeks. If the plans are long-term ones, then the main thing is that you need to understand right now that the vast majority of altcoins are very far from historical highs, which cannot be said about bitcoin, which is about to reclaim its famous maximum of $20,000. If it falls, altcoins will inevitably be sold at times more aggressively. In addition, if the mood for bitcoin is now set by large investors, or "smart money," then retail non-professional investors rushed to altcoins, whose actions can be much more impulsive than institutions.
There are several options so far: look for the most heavily fallen coins from the top 100, buy for the short-term and sell as soon as the market again runs into technical overbought. The second option is to buy for a long perspective without reacting to the extreme turbulence that we can observe throughout December. Here you can also choose almost any coin from the top 50.
It is definitely worth paying attention to bitcoin forks. It is worth investing in litecoin, which is also considered as the little brother of BTC. XRP has suddenly soared up after so many years of negativity, and judging by the fact that American banks may be prohibited from blacklisting competing industries, which includes Ripple, the current growth rates may be far from finite. In a short-term speculative format, it is worth keeping an eye on the DeFi coin yearn.finance (YFI). The cryptocurrency demonstrates high fluctuations and is just perfect for a buyback after another large-scale fall. Investors make great money on its volatility.
Monero remains to be one of the best anonymous coins. Although there is often news of its delisting from cryptocurrency exchanges, this suggests that it is fulfilling its function and has the potential for growth.
Of course, even at current levels, it is worth buying ether (ETH) for a long-term perspective. In addition to the fact that everything works on the Ethereum blockchain, the project is successfully moving towards ETH 2.0. It is highly likely that we will not only see the achievement of the all-time high of $1400, but also a significant excess.
Oleg Chebotarev, journalist, crypto-investor
The cryptocurrency market surged to a record high in November amid general instability in the global economy — a combination of the pandemic and political uncertainty in the world's largest economy, the United States. Unsurprisingly, many investors have transferred some of their funds to anonymous and decentralized assets.
However, after the record growth, a traditional correction has arrived on the market. Altcoins lost up to 20% of their value in a few days, and the total damage to traders amounted to several hundred million dollars. However, where someone loses, others always find it.
In December, I would advise you to traditionally pay attention, of course, to ETH — this is an altcoin for long-term investments and saving your assets. I advise building up a portfolio in the current correction only for those who have not done so, following my advice at a price of $140. I would recommend keeping this cryptocurrency in the portfolio, as its maximum price has not yet been reached.
XRP price during the correction fell by 20% per day, 5% more than ETH, however, it is still a very promising investment asset. I would recommend growing your portfolio in this cryptocurrency as much as possible.
Dmitriy Gurkovskiy, Senior Analyst at RoboForex
November became an extremely successful month for the cryptocurrency market: the inflow of money from private and institutional investors turned out to be the maximum over the last several years, and price rates were updating their peak levels. Expectations for December are generally neutral, but the cryptocurrency market is known to be strong, including its unpredictability.
ETH: Everyone is waiting for Ethereum 2.0
As early as December 1, Ethereum can launch the first phase of the Ethereum 2.0 network, for which there should be a clearly regulated number of coins on the deposit contract. If the required amount of coins is not meet, the start should be postponed for a week. But if everything happens on time, the ETH rate will receive the very long-term support that has been talked about so much this year. In a positive scenario, ETH can grow up to $640 and more.
XRP: There are chances to take off
In November, XRP renewed its maximum since September 2018 and is now "stuck" in a correction, but if the cryptocurrency market goes up again, the potential for XRP growth is very significant — up to $0.82.
XMR: Monero will follow the rest
The general vigorous mood of the cryptocurrency market can pull XMR along with it. It is fundamentally important here to leave the limits of the $105.2-135.1 range, a breakdown of its upper border will open the way to a new test of the $150 level.
LTC: The correction should not be long
After the November rise to local highs, the Litecoin rate is correcting, which is normal. If corrective sales take the cryptocurrency below 62-62.1, then buyers will return to the digital asset rather quickly.
Yuriy Mazur, Head of Data Analytics at CEX.IO
At the end of November, Chainlink continues to be in significant plus relative to the end of October, this coin grew by 50% on November 24, but amid the subsequent decline, this growth decreased to 10-20%. Tezos showed more restrained positive dynamics during this time period and grew by 7-14%. Monero showed similar to Chainlink's price dynamics and grew by 50%, but during the downward dynamics of the whole cryptocurrency market, the growth of this coin decreased to 10-20%.
Currently, AAVE, the token of the Self-titled DeFi project, has a good growth perspective, which showed a correction below the market during the recession on November 26. The Augur token (REP) also shows excellent price dynamics, which held its positions at the support level formed during the growth phase from the end of October, during the market recession provoked by the decline in bitcoin.
It is also worth noting nem (XEM) and neo (NEO), which are also quite confidently maintaining their positions amidst falling bitcoin's price, being in positive territory relative to the beginning of November.
Also, among the coins with great growth potential, supported by the significance of their contribution to the development of blockchain technology, I include zcash (ZEC) and its sidechain called Horizen (ZEN). Both of these coins have good growth potential from a historical point of view, and are also among the leaders in the field of private transactions via a distributed ledger. At the same time, Horizen has one of the most distributed network of nodes among all cryptocurrencies.
Sergei Khitrov, Founder of Listing.Help
Now the world of cryptocurrencies has reached the point where growth is increasingly correlated with the real development of companies. Accordingly, I shall divide four projects that have already been successfully developed and applied for several years, and now, with the advent of classic business, have the opportunity to significantly accelerate their growth.
- Waves. The platform was founded by Alexander Ivanov in 2016. Since then, the company has been actively developing and participating in leading events. At the end of 2020, the token showed a very large jump in value. It is also worth noting that the Waves Enterprise subsidiary has been actively introducing and developing blockchain in large structures for several years. The demand for cooperation with Waves is growing every year.
- Ether. Behind the scenes, there are a lot of large corporations discussing issuing their tokens by the end of 2021. Most of them are considering the Ethereum platform, as it has shown its convenience and efficiency on a variety of projects. Also, the infrastructure is well-prepared for ERC-20 tokens (based on the Ethereum blockchain). For example, it is much easier and cheaper for such tokens to list on exchanges. Ethereum now looks very bullish as well, especially with the launch of the Ethereum 2.0 network.
- BNB. The token belongs to the company Binance, which has a very high reputation and leading positions in the ratings in many areas. It is also worth noting that the company owns the largest cryptocurrency resources in the world, one of which is the CoinMarketCap website. I do not think it is worth waiting for X's on this coin, but the rate may rise by 50-60%, and the project has very great prospects for mass development, which can bring good income over the long haul.
- Stellar. A highly respected project among old crypto enthusiasts. The company was founded by Jed McCaleb, who has many famous projects in his portfolio. There are opinions that the company might be able to bypass Ripple, which will allow it to get into the top 3 in terms of capitalization. Stellar is already partnering with IBM today. Over the past few weeks, the token has shown record growth among all cryptocurrencies. I am sure that in 2021 we will be able to see marks comparable to the historical highs of this currency.
Andrey Khodosok, Founder of Investonomics.ru
Before talking about cryptocurrencies that are worth investing in, I should say that in December the crypto market has all the prerequisites for significant growth. Here is why:
- Joe Biden won the US election. And a situation has developed in which the Democratic Party controls the executive and legislative branches. A similar situation was with Barack Obama. During that period, a huge amount of dollars was printed, during Obama's two presidential terms, the national debt has increased approximately threefold. If this trend continues, then a colossal amount of dollars will be printed. Already, monetary policy measures are estimated at trillions of dollars, and economic aid packages are estimated at $2-3 trillion.
- It is becoming clear that the coronavirus pandemic is at its peak, and further the situation will improve slightly. Some countries are getting out of lockdown, some are easing restrictions. This also generates positive investment signals.
- Today, the stock market is significantly overbought. Bubbles appear on it, and many leading experts talk on this. Taking into account the fact that there are now direct institutional channels between the classical markets and the cryptocurrency market, one can expect that part of the funds from the classical market may flow into cryptocurrencies. With a sufficiently low liquidity of the crypto market, such injections can spur significant growth.
If we talk about specific cryptocurrencies for investment, then it is worth considering bitcoin first. The most popular cryptocurrency is already in the portfolios of various institutional companies. Large buyers, if they are interested in the crypto market, will of course buy BTC. And despite significant gains in November, bitcoin still has a lot of potential.
You should also pay attention to ether. In December, it is likely to be even more interesting than bitcoin, and may grow at a pace that outstrips the entire market. This is due to the fact that the Ethereum 2.0 update will appear in December, which will significantly improve the speed of transaction processing. Given the large number of tokens operating on the basis of Ethereum, I expect an increase in interest in ether from other projects and an increase in the rate both on the news and on the economic component itself.
The third coin to consider is vechain. The project team entered into a number of contracts with pharmaceutical companies to control the authenticity of medical products, which increases the real value of the tokens. The coin is also listed for listing on Coinbase. All this creates the potential for multiple growth.
Igor Kuchma, TradingView Analyst
Despite the fact that the second wave of coronavirus restrictions in October and November did not have the same impact on the markets, there is no more stability in the world. Geopolitical risks are to blame. In particular, the US presidential elections, Brexit, the worsening situation around Iran after the assassination of the leading nuclear physicist Mohsen Fakhrizadeh, etc.
Also, recently there was news that India, one of the main oil consumers in the world, plunged into a recession for the first time in almost a quarter of a century. This suggests that the coronavirus has affected everyone and everything. To restore business growth and revive the economy, central banks will have to resort to stimulating monetary policy more than once, and governments will have to accept additional aid packages for the population and businesses.
As a backdrop to all this, we will — most likely — see a fall in the currencies of these countries and an increase in defensive assets, in particular, gold and, possibly, bitcoin. It is worth noting that recently bitcoin almost reached the psychologically important level of $20,000, but was unable to strengthen and a correction began. However, the gurus did not miss the moment to predict bitcoin at $100,000.
On the other hand, there were those who started talking about the end of the crypto rally. Someone referred to news that US Treasury Secretary Steven Mnuchin plans to speed up the introduction of new rules for cold wallets.
It is important to understand that this news comes after the fact. Crypto assets are highly volatile, which indicates a lot of risk. You can make money, but you can also lose, especially if you just entered the market and follow the advice of the "couch analysts." When choosing an altcoin or any other active, it is worth paying attention to both technical and fundamental factors. For example, what was the reason for XRP's growth? One of the factors could be the news of the acquisition of XRP for $45.55 million as part of the buyback program. On the other hand, we need to look at the general trend, whether we are seeing the formation of an upward channel, etc.
Daniil Rostovtsev, Tantum Magnus Technology CTO
Many are interested in how to start and where to invest. By my example, I can say that it is most profitable to invest in cryptocurrency. It is the one that will completely take over the world and leave paper money behind in the next few years. Its rate can always fall, but if you wait a little longer, then it brings investments in 2, 3, or even 10x times more invested funds.
Take bitcoin, for example. On November 3, its rate was $13,400, and on November 30 it was worth more than $18,000. Of course, this is not always the case, and if you want to receive income from long-term investments, then this is the case as today the cost of 1 BTC is thousands of times higher compared to 2009, when it was only $1.
It is impossible to build a forecast based on statistics alone, how much any cryptocurrency will cost in December, since various factors affect the cost. But since my personal capitalization in BTC is above $15,000, I recommend investing in it, because at the end of the year its rate will not be able to fall below $13,000.
This article is distributed for general informational and educational purposes only and is not intended to constitute legal, tax, accounting or investment advice.