Hedera Hashgraph Doesn’t Have Much Appeal in a Sea of Competition

Hedera Hashgraph (CCC:HBAR-USD) is gaining traction of late, and like nearly all other cryptocurrencies it is inherently volatile. 

Concept tokens for Hedera Hashgraph (HBAR) on a black keyboard.
Source: Shutterstock

The most recent news moving prices relates to the company investing in its own growth.

Hedera Hashgraph isn’t yet a widely known name in the cryptocurrency space, but that may change. 

As I mentioned, the project isn’t as widely discussed as many others in the crypto space. Let’s begin by understanding why its price movement likely plays a large factor in that truth. 

Hedera Hashgraph has grown significantly in 2021. However, it simply hasn’t taken off with the explosive growth seen in other cryptocurrencies. That likely explains why it garners far fewer headlines than some of its competitors. 

Let’s compare it with Dogecoin (CCC:DOGE-USD) to understand what I mean. Both HBAR and DOGE have traded between 15 cents and 70 cents over the last few months. So they’re comparable on a pure cost basis. 

Still, Dogecoin is much more well known than Hedera Hashgraph although the latter arguably deserves to be as popular. The difference is simple. While Hedera Hashgraph has grown in price by an astounding 1,000% year-to-date, it isn’t the more attractive growth story of the two. Dogecoin has grown by approximately 4,600% in the same period.  

Investors are looking for growth in the cryptocurrency space first. Then they are looking to understand the underlying projects and utility. 

Since we already know that Dogecoin was created as a joke and has little to no utility, it raises the question of Hedera Hashgraph’s utility.

Somewhat Undifferentiated

The more one reads about Hedera Hashgraph the more it appears like a competitor in a sea of similar offerings. 

It is a public network that allows individuals, companies, and institutions to create decentralized apps (DApps). 

As with all of its competitors it claims to be designed to be a fairer, more efficient system that improves upon the performance of those it seeks to supplant. Pretty standard stuff. Also fairly uncompelling. 

HBAR tokens fuel the creation of smart contracts, storage and transactions. That too, is fairly standard. It makes it hard to guess where Hedera Hashgraph may be headed in terms of price, but that is ultimately what investors are interested in. 

For better or worse, potential investors are going to be swayed by predictions of future growth in the cryptocurrency space. 

The good news is that growth is certainly expected, but it may not be enough to attract investment in Hedera Hashgraph.

Coinpedia expects that HBAR coin should hit $1.23 by year’s end based on current sentiment. That same prediction indicates a wide price window between $3.98 on the high end and 68 cents at the low end. 

Another prediction, this one by Wallet Investor, suggests much lower growth. Its analysis indicates 63 cent price levels in a year and only $1.70 five years later. 

Such price predictions are notorious and probably not much more than a guess. The best we can say is that growth is anticipated, but that’s generally true across cryptocurrency. 

But Hedera does have one thing going for it.

Ecosystem Development

Hedera Hashgraph is undergoing development fueled by investment. The project’s governing body, The Hedera Governing Council, recently announced that it had allocated 20% of the HBAR supply ($4.5 billion in value) toward developing its ecosystem. 

“The foundation will oversee the administration and development of the Hedera ecosystem by providing grants to developers, startups, and other organizations with the goal of expanding the network across products like DeFi, NFTs, CBDCs, and iGaming,” the statement said.

I’d suggest sitting this one out. There doesn’t look as if there’s enough interesting news coming out of the company right now. The truth is that investors will likely remain interested in bigger-name projects with greater traction. 

Perhaps Hedera Hashgraph will become something great, but it’s hard to see why right now.

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.

Article printed from InvestorPlace Media, https://investorplace.com/2021/09/hedera-hashgraph-doesnt-have-much-appeal-in-a-sea-of-competition/.

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