3 Blue Chip Cryptos to Buy and Hold for the Long Haul

Despite market volatility, there are still blue chip cryptos worth buying right now

  • Binance Coin (BNB): A high-utility token, relatively less-volatile, with real use cases.
  • Bitcoin (BTC): Interesting updates and remarkable growth prospects in the long run.
  • Ethereum (ETH): Ethereum Merge upgrade has the potential to take this crypto to new all-time highs.
crytpos to buy: Various cryptocurrency coins are on a computer in front of someone holding a phone
Source: Chinnapong / Shutterstock

In traditional finance or in the corporate world, the term ‘blue-chip’ is a buzz word used to describe the best-quality investments available at a given time. A direct analogy to the most valuable blue poker chips, blue chip cryptos are tokens long-term investors may want to use as a foundation for their long-term portfolios.

In my view, categorizing various projects into quality buckets is useful. There are various aspects of quality specific to the crypto sector investors may want to think about. It could be how established a given project is.

What the given track record of developer or application growth is on a particular network. Stability, momentum, and community size, as well as tokenomics and fundamentals such as total value locked (TVL) are other factors to consider.

That’s a lot to think about. And in a world with thousands of crypto projects, narrowing down such a broad list can be difficult.

That said, these three projects provide what I think are blue chip opportunities right now. Let’s dive in.

BNC Binance Coin $325.22
BTC Bitcoin $29,535.81
ETH Ethereum $1,952

Top Blue Chip Cryptos: Binance Coin (BNB)

A Binance Coin (BNB) sits in front of trading charts.
Source: Shutterstock

Binance Coin (BNB-USD) is the token supporting the largest crypto exchange in terms of daily total trading volume. For investors in the crypto market, exchanges provide incredible value, for obvious reasons.

Liquidity, and the ability to trade, are integral to the idea that this asset class can be investable. For institutions, well-functioning exchanges provide tremendous value in this regard.

For those taking a long-term view that institutional adoption in the crypto space will pick up, Binance is a project to consider. A centralized exchange, Binance is the largest, and generally perceived to be “best” crypto exchange in the world. This exchange is available in many countries globally, though only in some states in the U.S. due to regulatory laws.

However, Binance Coin has other use cases besides paying fees on its platform. Indeed, this network’s use cases have exploded after the Binance Smart Chain launched for smart contract-based DeFi applications.

As the value of Binance’s ecosystem grow, so too should the value of BNB. Over the long-term, BNB has become a rather impressive performer, despite recent weakness tied to market performance.

Bitcoin (BTC)

Bitcoin (BTC-USD) cryptocurrency with pile of coins, Vector illustrator
Source: Sittipong Phokawattana / Shutterstock.com

 

Bitcoin (BTC-USD) is what many refer to as the godfather of the entire cryptocurrency sector.

This token is what most investors think of when they think of “cryptocurrency.” Often viewed as a store of value, Bitcoin is seen as the way to play the crypto market by most institutional investors. This token is listed in more ETFs and other products than its peers, for this reason.

That said, of late, Bitcoin has traded in closer correlation to the overall market. This token’s supply is capped, and is often viewed as a hedge against market volatility and the U.S. dollar. However, with correlation building, and the U.S. dollar surging, there have been few catalysts to take Bitcoin higher.

In this inflationary environment, I do think the currency hedge argument could make sense. However, I also think as a bellwether of crypto acceptance, Bitcoin stands to benefit from institutional capital flows. Accordingly, those looking for a blue chip crypto to buy on this dip, Bitcoin remains a top option right now.

Ethereum (ETH)

Crypto currency etherium. ethereum coin on exchange charts. e-currency Ethereum
Source: viktoryabov / Shutterstock.com

Ethereum (ETH-USD) is the world’s second-largest crypto in terms of market cap. Next to Bitcoin, Ethereum is the digital token that’s among the most well-known assets in this space. Indeed, being second-largest doesn’t necessarily make this project second-best.

Some think that Ethereum could overtake Bitcoin as the sector leader by market capitalization over the long-term. One of the key reasons for this is the network’s smart contract-based blockchain. Currently a proof-of-work blockchain, like Bitcoin, Ethereum is making the shift toward a proof-of-stake consensus mechanism.

This is a big deal. And there’s a name for this shift — the “Ethereum merge.”

Search interest for the “Ethereum merge” continues to surge, as investors look into what this is. A series of updates, which have been delayed but are expected to be finalized this year, this merge will allow for wide-spread staking on the Ethereum network. Thus, for those seeking yield in the crypto space, this is another reason to consider Ethereum.

Overall, these blue chip cryptos provide a stable foundation for investors to build their portfolios on.

On the date of publication, Chris MacDonald 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.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.


Article printed from InvestorPlace Media, https://investorplace.com/2022/05/3-blue-chip-cryptos-to-buy-and-hold-for-the-long-haul/.

©2022 InvestorPlace Media, LLC