Although it remains volatile and risky, investing in cryptocurrencies is still popular. The recently released Crypto Wealth Report from British consulting firm Henley & Partners says that 425 million people globally are invested in some cryptocurrency right now, with more than half of Generation Z (people aged 18 to 25) holding crypto in their portfolios. The report also found that there are 88,200 people worldwide who have cryptocurrency assets worth $1 million or more, though only 22 people worldwide can claim to be crypto billionaires.
The total value of the cryptocurrency market is estimated at $1.18 trillion, and Singapore is the country with the most cryptocurrency investors worldwide. The U.S. is ranked fifth in terms of number of crypto investors.
While regulators continue to try and crack down on cryptocurrencies and big price swings remain the norm, the popularity of digital coins and tokens remains largely undiminished. News that cryptocurrency exchange-traded funds (ETFs) could soon be approved and made available in the U.S. has only added to the enthusiasm. Here are the three best crypto picks for the rest of 2023.
While its price has pulled back nearly 20% from a peak of $32,000, reached in July this year, there are reasons to remain bullish on Bitcoin (BTC-USD), which is still the largest cryptocurrency by market capitalization. Currently trading at around $25,700, the price of BTC has slumped lately along with stocks. Interestingly, though, bearish bets against Bitcoin have been few despite the recent pullback. Decentralized exchange SynFutures noted that activity among options traders shows they have been unwilling to bet on a continued decline in BTC.
SynFutures said the options action in recent weeks suggests that losing the $30,000 support level is likely only a short-term deviation for Bitcoin, with the price likely to rise again soon. In a note to clients, SynFutures said the options trading activity “…suggests [traders] don’t foresee the $30,000 level transforming into significant resistance, at least in the near term.” At the same time, any approval of cryptocurrency ETFs in the U.S. is sure to be a big catalyst for Bitcoin as it is the most widely held digital asset.
U.S. bank Wells Fargo (NYSE:WFC) made headlines in early August when one of its analysts predicted the price of cryptocurrency Ripple (XRP-USD) could reach $500. Considering that XRP is currently trading at just 50 cents, the aggressive price prediction caught the attention of crypto bulls. To be sure, XRP has been on a tear this year, having gained 48% since January and nearly matching the 55% year-to-date (YTD) gain in Bitcoin. However, XRP’s current price is well below its five-year high of $1.65, reached in April 2021 at the height of the crypto craze.
While some analysts gave XRP a price target as high as $10, the forecast from Wells Fargo was a big outlier. Shannon Thorpe, the analyst in question at Wells Fargo, said she sees all major financial institutions moving to hold XRP tokens following a recent court decision that found the cryptocurrency is not a security and should not be regulated like a stock. Following the court ruling on July 13, XRP’s price surged 97%, though it has since given back much of that gain as the entire crypto market retreats.
On a positive note, several cryptocurrency exchanges that had previously delisted XRP, including Coinbase (NASDAQ:COIN), have relisted the digital token following the court ruling. Many analysts see XRP, which facilitates secure and instant financial transactions across blockchain networks, as one of the more important cryptocurrencies.
While it is not a cryptocurrency itself, Coinbase is the largest cryptocurrency exchange in the U.S., and its stock has been red hot this year, having increased over 130% since January. In August, Coinbase scored a major victory when it was approved to offer cryptocurrency futures trading to retail investors in the U.S. Going forward, Coinbase can offer Bitcoin and Ethereum (ETH-USD) futures directly to individual investors who are customers of its U.S. exchange. Previously, only institutional clients of Coinbase could trade cryptocurrency futures products.
Coinbase is also expected to be a big beneficiary of any crypto ETFs allowed to come to market and be traded by retail investors. The approval to offer futures trading to individual investors and the prospect of crypto ETFs are seen as major wins for Coinbase as it battles the U.S. Securities and Exchange Commission (SEC) in court.
In a lawsuit, the SEC accused Coinbase of operating illegally because it failed to register as a securities exchange. Coinbase has been fighting back, and the consensus view appears to be that the crypto exchange has been beating the regulator in recent court rulings, helping propel its share price higher.
On the date of publication, Joel Baglole did not hold (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.