In February, the recovery began in the cryptocurrency market, but many are still not sure that the coins from the top 3 will be a good investment in the short term.
Victor Argonov, stock and ETF market analyst for EXANTE:
The middle and the end of February were quite successful for the cryptocurrency market. Positive news, and most importantly — the absence of scandals like Bitcoin Cash hard forks at the end of last year, provided the market with small but steady growth. Right now, when investors became confident that the annual decline was not the way to a complete collapse of the entire cryptocurrency market, but only a painful, but necessary correction, many of them began to show interest in buying both major currencies and Altcoins.
Now we are seeing signs of recovery in the cryptocurrency market: positive trends for volumes, capitalization, and volatility. In the coming days, with a high probability, Bitcoin will take new local records as it leaves the winter lethargy, and I am optimistic about other major currencies. Today there are many new cryptocurrencies, but it is difficult to guess the long-term leaders among them so I would advise the investor to divide the portfolio into five parts (not necessarily equal).
The flagship of the market is still Bitcoin. It is worth investing the first part of the funds in it. It is more stable than other leading currencies and in a sense is a protective asset among the cryptocurrencies. At the same time, half of the entire market lies on it, and this is the most popular cryptographic device for real payments.
Despite the apparent disappointment of the market in Ethereum (ETH/USD), the second part of the portfolio is worth investing in it. Experts connect the excessively deep recession of ETH in 2018 with an abundance of unsuccessful ICOs, and there was no fault of the Ethereum holders. On the contrary, Ethereum in a certain sense turned out to be a victim of its popularity: it was often used in unscrupulous projects. The recent news about the built-in ETH-wallet in the Samsung Galaxy 10 also play to strengthen this currency.
As it is known, in 2018, ETH gave up its second place in the currency rating to the XRP token (XRP / USD), which also deserves attention. This is the token of the Ripple system, which banks are actively implementing today as “crypto rails” for many other assets, from the crypt to fiat currency. It is necessary to invest a third part of the funds to XRP. Ripple has often been criticized as an opaque centralized company. Ripple’s open and strictly decentralized competitor is considered to be Stellar (XLM). Perhaps one day it will overtake Ripple, but so far Ripple and XRP are leading the race.
I would fill the fifth part of the portfolio with less capitalized, but promising projects with the use of the blockchain unfamiliar to the masses — prediction markets such as Augur (REP) and Amoveo (VEO), Brave browser (BAT / USD), etc. Some of them may make a revolution in the economy or other areas of life. After all, the goal of many of these projects is to transfer smart contracts from the field of experiments into a part of everyday life. The world has become accustomed to cryptocurrencies but only knows by hearsay about other blockchain opportunities realized through smart contracts. Meanwhile, these opportunities are enormous.
Altcoins are currently experiencing a rather difficult time. As I have repeatedly said, only those of them who have firmly occupied their own niche and have acquired a critical volume of users who trust them will survive. I can recommend paying attention to Hyperspace (AMP) — this is a token of the “Synereo” Israel company, which is used as an internal currency on a special WildSpark platform – as an alternative to regular likes. With the help of the AMP token, users encourage each other, and the platform is developing quite successfully. Considering the fact that the token, together with the general decline in the market, lost quite a large part of its value last year, the investments made now can bring you tangible income.