Writing at consulting giant The Motley Fool, RJ Fulton pointed to cryptocurrencies that investors should look into. The analyst has some altcoin projects on his radar. Here are the details…
The analyst first mentioned the market leader BTC
The situation for Bitcoin is relatively simple and straightforward. Bitcoin is the world’s most valuable cryptocurrency. It accounts for about 40 percent of all value in the entire cryptocurrency market cap. At one point, that number had grown to 90 percent. Many investors choose to own Bitcoin because of its proven track record of performance. It also has unmatched decentralization, security, and increased scarcity. Also, since most other cryptocurrencies are correlated with Bitcoin’s price, investors tend to choose to invest in Bitcoin as it acts as a de facto market index for all cryptocurrencies.
Dominant Blockchain in DeFi and leading altcoin Ethereum
Ethereum’s place as the second most valuable cryptocurrency is gaining in importance with smart contracts. With smart contracts, developers can build applications such as decentralized exchanges like Uniswap, NFTs, and even lending platforms like Aave and Curve. This class of alternative to traditional finance creates an industry known as decentralized finance or DeFi. Considering that more than half of the $60 billion in all of DeFi is in the Ethereum Blockchain, an investment in a smart contract platform is no easy feat.
Ethereum’s vice continues to grow
One downside of Ethereum is that since its rise in popularity, user traffic can clog the network, making it slow and costly. To fix this, Polygon was created as a layer 2 “sidechain” to make Ethereum faster and cheaper. Polygon processes transactions separately from Ethereum using a more affordable and faster proof-of-stake consensus mechanism. Once the transactions are complete, they are added back to Ethereum’s Blockchain for the final solution. It has increased 25,000 percent since its creation.
Polygon’s popularity has come a long way since its inception in 2018. Just this July, Disney selected Polygon to join its venture capital segment known as the Accelerator Program. Disney will now devote time, money and resources to helping Polygon realize its vision as a blockchain that supports the development of Web3. The ultimate goal is the development of a partnership between Disney and Polygon as the media giant takes steps to enter the world of NFTs and Blockchain technology.
Finally, according to the analyst, each of these cryptocurrencies has its own reasons to deserve a place in your portfolio. They also all have a chance to become leaders of different industries within crypto. In the long run, these cryptocurrencies are positioned to continue to lead an emerging asset class that is still growing.
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