Investors seeking the best cryptos to buy now should expect cryptocurrencies’ valuations to continue to decline in the short term. Such a scenario is likely to unfold in the wake of the collapse of FTX and the scandal involving Sam Bankman-Fried. In short, he used money deposited by FTX’s customers to fund trading by Alameda Research, in which he owns a stake. In the wake of the scandal, the public’s trust in the crypto space continues to wane.
That leaves investors wondering whether the entire movement was ever anything more than a house of cards. I’d argue that cryptocurrency has entered a new era, in which the regulation of coins will increase and the importance of their utility will rise as well.
The scandals, however, will continue to surface. But the remaining cryptos will become the basis of an improved crypto sector.
Investors should consider the following cryptocurrencies that have fared well even as overall sentiment towards the sector has fallen in the past weeks.
Monero (XMR-USD) remains one of the best cryptos to buy now for a simple reason: It is designed to maintain users’ anonymity.
Monero uses advanced cryptography that obscures the identity of senders and recipients alike. What investors should know is that even other cryptos noted for the anonymity of their trades, namely Bitcoin (BTC-USD), are easily traceable.
Monero’s developers set out to create a private, secure cryptocurrency. Five of Monero’s seven initial developers chose to remain anonymous. Some pundits even speculate that Bitcoin creator Satoshi Nakamoto also had a hand in creating Monero.
This is interesting to investors because the SEC’s regulation of cryptos are increasing. The collapse of FTX is only going to give the agency more impetus to do so.
The result is that the demand for Monero is likely to increase because, for better or worse, crypto is useful for criminals, while some law-abiding investors simply seek to maintain their anonymity.
One of the strongest arguments in favor of buying OKB (OKB-USD) is how well it has performed relative to the leading crypto projects. OKB’s prices have fallen 20% in 2022. Meanwhile, Bitcoin, which largely dictates the direction of the crypto market, has sunk by more than 60% this year.
OKB has also shown signs of greater stability than most other cryptos in recent weeks and months. Cryptocurrency media outlets noted OKB’s resilience last month when rumors about FTX’s liquidity troubles were just beginning to circulate.
OKB continued to stay relatively stable into mid-December as its prices remained relatively strong following the arrest of FTX’s founder, Sam Bankman-Fried.
OKB is a utility token that allows users to access the Maltese crypto exchange, OKEx. The exchange is one of the largest global cryptoexchanges, boasting the third-most liquidity and the fourth-highest trading volume of all exchanges.
OKB tokens can be used to generate passive income, and OKB should attract greater interest moving forward, since there are fewer cryptos to buy following FTX’s collapse.
Dash (DASH-USD) is worth considering because there is a chance that it may never be regulated by the SEC. Dash is an offshoot of Litecoin (LTC-USD) which is classified as a commodity, instead of a security.
That means that, like Bitcoin and Lirecoin, Dash is subject to the oversight of the Commodity Futures Trading Commission (CFTC) and not the SEC. In short, Dash has a chance to remain decentralized moving forward.
Generally, Dash hopes to become faster and more private than Bitcoin. Dash’s utility is that it facilitates global payments through its decentralized network. The owners of Dash hope that it can continue to build its network to serve both individuals and institutions.
Dash relies on a proof-of-work consensus mechanism, while many other coins are switching to proof-of-stake mechanisms. That fact could make it intriguing to firms that mine cryptos.
Neo (NEO-USD) is going to remain intriguing to crypto investors for some time to come. Simply put, Neo’s price has appreciated over the past month, so it has bucked the sector’s downward price trends.
For example, the stock market fell precipitously when the Fed raised its interest rate outlook on Dec. 15. As a result, the prices of most cryptos fell. Yet Neo stood out, as its price actually moved higher.
Neo is interesting because it was derived from Antshares, which is believed to have been the first public blockchain in China. That means that Neo can be considered to be the Ethereum (ETH-USD) of China.
That’s one of the strongest reasons to consider buying Neo now. On the one hand, China banned all crypto mining and trading in late 2021, representing a big blow to the industry in the nation. But developers there continue to develop apps and if China reverses course, Neo’s prices will increase quickly.
So Neo is something of a bet on China’s future crypto landscape, and it is performing well currently despite the ban.
Decred (DCR-USD) is another coin that has performed well even as markets have faltered in the wake of the Fed’s December meeting.
A large part of the reason behind its strong performance involves Decred’s consensus mechanism. Proof-of-work mechanisms are largely out of vogue due to environmental concerns, and proof-of-stake mechanisms are now in fashion.
Decred uses both. It mines through a proof-of-work mechanism and generally, POW mechanisms prolifically reward miners. Decred, though, only gives the miners 10% of the total reward, while 80% of it goes to proof-of-stake participants who participate in the firm’s voting system.
That makes Decred something of a hybrid option, and its uniqueness could spur greater demand for it.
Decred does not seem very useful at this point. That will be the next challenge for the project which is starting to garner strong attention.
Compound (COMP-USD) relies on the power of compounding interest. The platform works by depositing funds into pools that correspond to other cryptocurrencies. The depositors then receive interest on those investments.
For example, a user can deposit BTC into a corresponding pool and receive cBTC or a cToken in return. These cTokens increase in value as the exchange rate of the underlying cryptocurrency increases.
Compound pools also provide secured loans to users who have collateral. So those who want to borrow ETH , for example, could borrow up to 50%-75% of the value of their collateral using Compound.
So Compound is one of the more creative cryptos when it comes to cryptos, and it is rather useful. Compound lets users receive interest on their crypto, and its collateralized loans enable users to obtain crypto assets by using their “real-world” assets as collateral.
In the wake of the collapse of FTX, Tether’s (USDT-USD) utility has become even more apparent. Tether’s utility is its liquidity.
Those who bought cryptos on FTX panicked as they couldn’t withdraw their money from the platform. That problem clearly highlights the utility of USDT which is pegged to the dollar and backed by reserves. Tether states that it maintains reserves equal to or greater than the total value of the fiat currency that has been used to buy USDT.
That means investors who want to quickly liquidity their tokens and coins into U.S. dollars, for example, can do so immediately. Theoretically, it also means that a run on Tether’s reserves would not cause an issue. That’s why crypto investors should really consider buying Tether in the wake of the FTX fiasco.
The value of USDT is pegged to the dollar so it isn’t going to rise. It’ll always be worth $1. It’s the peace of mind of Tether that make it worthwhile.
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.