Dominic Basulto, an analyst at finance and consulting firm The Motley Fool, talked about cryptocurrencies on his target for July. Here are the coins chosen by the analyst and their comments…
Analyst talked about Bitcoin, the largest cryptocurrency
Amid the ongoing uncertainty in the crypto market, several cryptos are emerging as potential investment targets towards the second half of 2023. “The two cryptos that stand out for me are Bitcoin and Cardano,” says analyst Basulto. Both cryptos have superior long-term growth catalysts. First off, Bitcoin is already up more than 80 percent year-to-date, but the best may not be yet to come. One key factor is the BlackRock Rally, which started in mid-June after the world’s largest asset manager BlackRock announced plans for a new spot Bitcoin exchange-traded fund (ETF).
As we reported as Kriptokoin.com, other institutions made their own spot Bitcoin ETF applications in a short time. While the SEC has since said that these ETF applications will not be approved in their current form, it is clear that there has been a lot of pent-up investor demand for new ways to invest in Bitcoin, and BlackRock has already resubmitted its application. On top of that, we are less than 12 months away from Bitcoin’s next halving, scheduled for April 2024. With each halving, the reward paid to Bitcoin miners is halved. Past halving events for Bitcoin in 2012, 2016 and 2020 have coincided with massive price increases for crypto. Therefore, investors are hopeful that a similar price phenomenon will occur in 2024.
According to the analyst, the picture becomes even more attractive when zooming in on Bitcoin’s charts. As Cathie Wood of Ark Invest points out, Bitcoin’s long-term growth potential could make it a $1 million crypto by 2030. Cathie Wood has identified eight different uses for Bitcoin, and each of these uses can trigger growth. Simply put, Bitcoin is becoming an increasingly important part of the global financial system and therefore its value will continue to increase beyond just payments.
The second coin on the list was Cardano
By mid-April, Cardano had been largely keeping up with Bitcoin, gaining 80% over the year. But then came a disastrous June. When the SEC filed a lawsuit against cryptocurrency exchanges Coinbase Global and Binance, it referred to Cardano as one of the “non-registered securities” these exchanges offer customers. Almost immediately, the market panicked and a rapid sell-off began. That’s why Cardano has lost almost 20% in the last 30 days. So Cardano comes with an enormous amount of regulation risk. However, the analyst says:
But I think the market is overreacting and Cardano may be ready for a comeback. Cardano has risen 8% in the last seven days as a potential sign that the situation is stabilizing. An important thing to consider here is that the SEC did not go after Cardano directly. More than any other top crypto, Cardano has taken steps to protect itself against a possible SEC legal challenge. The long-term growth catalyst for Cardano has been related to decentralized finance (DeFi), one of the most important sectors in the blockchain world. Entering the year 2023, DeFi was one of the priorities for Cardano. There has been a lot to be excited about this year. There has been a significant increase in core DeFi metrics alongside the launch of new products for the Cardano DeFi ecosystem.
All this seems to indicate that Cardano has a lot of upside potential going forward. The SEC remains a major risk factor for both Bitcoin and Cardano. While the SEC has shown no intention to go after Bitcoin directly, it has said that there will be no spot Bitcoin ETFs in the foreseeable future. However, both Bitcoin and Cardano are attractive investment targets for July if you are willing to take on this potential regulatory risk. If the regulatory outlook improves, there could be much more bullishness for both in the second half of 2023.
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