If you want to know where cryptos may be headed in 2024 and beyond, just look at Generation Z. While I hesitate to focus on any one metric for any investment class, the underlying cryptocurrency market simply doesn’t respond to rational considerations. It appears utterly irrational until you realize the power of the underlying demographic catalyst.
Unlike other asset classes, cryptos represent a decentralized paradigm shift. It’s a purely digital ecosystem, carrying no real connection to the physical world. In other words, you don’t hold certificates of crypto unit ownership in your hands. Rather, your wealth is represented in the binary code of digitalization. And that suits Gen Z just fine. After all, they have no real recollection of the analog past.
Therefore, it only makes sense that the zoomers’ investment of choice is cryptos. Even better, the stiff suits on Wall Street recognize the paradigm shift awaiting them. As Gallup mentioned, the economic boom of the 1980s and 1990s handsomely rewarded the baby boomers. The same might be said about the digital asset boom for the zoomers.
Here’s the best part. You don’t have to be a zoomer to participate. Below are key cryptos to watch.
Bitcoin (BTC-USD)
Under “traditional” assessments of Bitcoin (BTC-USD), one might conclude that both BTC and other cryptos are due for a pullback. According to TipRanks’ on-chain analysis, Bitcoin comes in as “mostly bearish.” In particular, the underlying blockchain’s net network growth landed at only 0.24%, a pessimistic signal relative to historical norms.
Also, large transactions – a momentum indicator focused on transactions greater than $100,000 – dipped 3.15%. That might signal lower participation among the whales or the biggest stakeholders of a particular virtual currency. If you want to look at the technical picture, Bitcoin continues to rise higher against fading acquisition volume. Ordinarily, you want rising volume to confirm a rising price action. That’s not happening here.
It might not matter. Over the past 24 hours from early morning Tuesday, BTC gained nearly 7% of market value. Regaining firm command of the $45,000 price level, 50K may not be too far away. Frankly, I don’t know where this money is coming from. All I can say is that Gen Z wants what it wants.
My idea? Don’t fight the tape.
Ethereum (ETH-USD)
Again, under a traditional assessment, Ethereum (ETH-USD) might not be much of a confidence-boost. Sure, its on-chain analysis suggests a “mostly neutral” backdrop. However, that’s not necessarily a riveting description, especially when you’re talking about one of the most exciting cryptos. Plus, some of these metrics are rather poor.
For example, TipRanks notes that Ethereum’s net network growth sits at 0.23%. That’s bearish compared to prior norms. Also, large transactions account for 0.57% of value exchanges in the underlying blockchain. That’s a lot better than Bitcoin obviously but it’s another bearish signal against historical standards. And yes, while Ethereum marches higher, acquisition volume has been slipping. That’s just not a great look in any other context.
However, we’re talking about decentralized digital assets. In the trailing 24 hours, ETH gained over 4%. And in the past seven days, the number two crypto by market capitalization swung up roughly 7%. Looking ahead, I’ve got to imagine that the $3,000 level will soon be in sight. As with Bitcoin, don’t fight the tape.
Tether (USDT-USD)
As a stablecoin or crypto asset pegged to a hard currency (usually the U.S. dollar), Tether (USDT-USD) lacks the impetus if you will of most other virtual currencies. Rather than the buy-low, sell-high directive, Tether enables investors to effectively store their wealth in the blockchain. So, when opportunities arise, investors can simply respond by trading Tethers for whatever cryptos they’re targeting.
Still, in many ways, it’s a high-risk, high-reward proposition. For example, Tether’s website clarifies any misconceptions about its USDT units. They represent digital tokens and are not legal tender. So, don’t bother the Federal Deposit Insurance Corporation (FDIC); they’re not interested in your sob story. Thus, investors expose their wealth to USDT at their own risk. If a digital bank run materializes, you are SOL as the kids like to say.
Subsequently, whether Tether falls below or above its 1:1 peg with the dollar may be symbolic of confidence in the crypto sector. In the trailing one-week period, USDT has mostly traded at or above parity with the greenback. In my opinion, that’s a solidly positive signal for blockchain assets.
Solana (SOL-USD)
Throughout 2022 and much of 2023, questions plagued Solana (SOL-USD). To make a long story short, Solana represents a quicker, more scalable and more accessible – due to lower fees – version of Ethereum. Unsurprisingly, many folks labeled it one of the Ethereum killers. However, the downcycle of cryptos (brought on in part by spiked interest rates) imposed a beating on SOL.
Another factor that clouded Solana – though through no fault of its own – was that it earlier enjoyed the backing of the disgraced Sam Bankman-Fried. Call it guilt by association. However, during the so-called “Uptober” seasonal cycle of cryptos, Solana absolutely skyrocketed. And aside from the normal ebb and flow – and the occasional sharp hiccup – SOL continues to march northward.
It’s hard to argue with the data. Just in the past 24 hours, SOL returned stakeholders more than 11% of market value. As of this writing, that makes it one of the best-performing decentralized assets among the top 10 by market cap.
Looking to the next few weeks, FXLeaders suggests that $160 may be a profit-taking point. Below $120, you still have a scalping opportunity here.
XRP (XRP-USD)
One of the most popular altcoins or alternative cryptos, XRP (XRP-USD) initially started off with a bit of controversy. Founded by Ripple Labs, debate among public forums materialized about whether XRP was truly decentralized or not. However, the U.S. Securities and Exchange Commission (SEC) targeted Ripple for a lawsuit alleging securities violations. Suddenly, it seemed as if the entire crypto community rallied around Ripple.
As you know if you follow the blockchain ecosystem, a favorable federal ruling bolstered sentiment for XRP. Almost immediately, the altcoin went vertically skyward. However, with the regulatory agency unwilling to let the ruling stand as is, XRP started to fade. Still, during the Uptober catalyst, XRP found its mojo again. Personally, I think investors should be able to trust the digital asset over the long haul.
From a fundamental perspective, the crypto cat’s out of the bag. On technical grounds, XRP has generally printed a series of higher lows since the summer of 2022. Barring some unforeseen catastrophic event, XRP’s kinetic energy should sustain.
Cardano (ADA-USD)
Another popular altcoin, Cardano (ADA-USD) enjoyed one of the greatest paradigm shifts in the virtual currency sphere in 2023. For most of last year, ADA languished, either slipping sharply relative to other blockchain assets or mired in sideways trading while other coins and tokens shot higher. However, circumstances changed for the better – a lot better – during Uptober.
Adding to the enthusiasm, Cardano continues to impress onlookers. Over the trailing 24 hours, ADA gained nearly 5% of market value. In the past week, it swung up a little over 4%. At the moment, the crypto coin trades hands for around 63 cents. Just a month ago, you could have bought Cardano for less than 40 cents.
Still, while ADA has already benefited from a significant surge, it’s still possible to scalp some upside from here. Recall that earlier in 2023, some experts called for Cardano to retest the $1 level. In hindsight, of course, that didn’t quite materialize. However, with cryptos enjoying newfound vigor, a buck in ’04 seems a very reasonable target.
Avalanche (AVAX-USD)
One of the other top-performing cryptos ranked among the top 10 by market cap, Avalanche (AVAX-USD) strongly benefited from the recent sentiment pivot in the blockchain. Right now, AVAX trades hands at just over $43. That translates to a 24-hour performance of nearly 12% up. Currently, the total value of the network stands at just under $15.8 billion, good enough for ninth place.
Billed as a layer one blockchain, Avalanche provides a base layer for applications and transactions. Basically, it acts as a foundational infrastructure upon which other applications are built. Specifically, Avalanche seeks to provide a platform for custom blockchain networks. In doing so, it aims to unseat Ethereum, thus representing one of the viable Ethereum killers.
Interestingly, AVAX prints “mostly bearish” on-chain signals, according to TipRanks. In particular, large transaction volume slipped 1.78%, which presents a pessimistic look. However, with 73% of individual unit holders in the money at the time-of-writing price, enthusiasm for Avalanche runs strong.
Looking ahead, the bulls may look to bring AVAX up to $80, the next logical upside target.
On the date of publication, Josh Enomoto held a LONG position in BTC, ETH, USDT and XRP. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
