The long-term outlook for cryptocurrency continues to be strong. The short-term is also looking good as the sector did not suffer long following the most recent halving event. Investors remain bullish as evidenced by the current cryptocurrency market capitalization of $2.6 trillion. That’s not far off from the all-time high of $2.8 trillion reached back in late 2021.
The biggest cryptocurrencies appear to be best positioned at the moment. Historically, the cryptocurrency market follows the leader. There is no reason to believe that will change anytime soon. Fortunately, the leader is again strong suggesting lots of opportunity throughout crypto.
Investors should understand that the space will continue to see lots of the introduction of lots of useless projects. They should also understand not to be distracted by those projects while understanding that cryptocurrency is part of the new financial system. Investing in solid projects in the crypto world is the same as investing in solid companies in the stock market. Let’s look at some choices.
Solana (SOL-USD)
Solana (SOL-USD) is likely to be the next cryptocurrency in line for a spot ETF. That’s the opinion of Brian Kelly who is the CEO of The BKCM Digital Asset Fund. However, it isn’t a foregone conclusion with several prominent names wondering if it might not take much longer. Those skepticsNote that Solana is far behind Bitcoin and Ethereum in relation to regulatory acceptance.
A proposed Solana spot ETF is not the only potential positive catalyst for Solana. Instead, it is simply one more reason to believe that the project will continue to grow in value. Solana has managed to grow buy more than 770% over the last 12 months without spot ETF approval.
The project’s strong trajectory is attributable to ultra fast transaction times. Transactions on its network are 46 times faster than those on Ethereum and five times faster than those on Polygon. Solana is going to continue to disrupt the leaders and if and when an ETF is launched, it’ll rise again.
Bitcoin (BTC-USD)
Bitcoin (BTC-USD) hardly suffered at all following the most recent halving. Prices briefly fell below $60,000 but are again approaching $70,000. Worries of a deep correction appear to have been overstated and investors are buying the dips.
Bitcoin does benefit from the approval of spot ETFs. That approval is a strong Reason to Believe In further adoption and integration of Bitcoin and cryptocurrency into the greater financial system globally. That, in turn, Is a great reason to believe In overall enthusiasm surrounding Bitcoin. The SEC approved 11 spot Bitcoin ETFs early in 2024. It’s clear that many of the world’s most important and influential financial institutions see the inherent value of Bitcoin.
If firms including BlackRock are willing to invest in Bitcoin that sends a strong signal to retail investors who may have remained on the fence. It seems clear to you me that Bitcoin is here to stay and with bullish predictions of $1 million Bitcoin prices in the future investors are sure to remain optimistic.
Dogecoin (DOGE-USD)
Dogecoin (DOGE-USD) has undergone a strong rally since late February and continues to thrive. In fact, the original meme coin is up more than 127% over the last 12 months.
By now, every cryptocurrency investor is aware that Dogecoin offers nothing in the way of utility. I’ve come to accept the fact that that doesn’t matter. Dogecoin is something unique in the cryptocurrency space and despite its lack of use cases it remains a worthwhile investment.
I should note that Dogecoin isn’t completely devoid of utility. There are limited use cases that have been developed including as a payment at GameStop (NYSE:GME) and to buy Tesla (NASDAQ:TSLA). However, Those use cases were developed primarily for promotional purposes. The fact is, Dogecoin hasn’t really evolved since its inception. It was never meant to be anything more than a joke but despite that it has grown into something very valuable.
Its continued success is a great example of why investors should shrug off bearishness around cryptocurrency in general.
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.
