Crypto investing is risky: The recent decline in the cryptocurrency market has been shocking, to put it mildly. The value of the cryptocurrency market was wiped out by $367 billion in just one day. Ethereum (CRYPTO: ETH) dropped 22% and Bitcoin (CRYPTO: BTC) dropped 15% over that time. Crypto investors are worried about the dramatic decline in prices as well as the quickness and velocity with which it happened.
Two cryptocurrencies that I would still be comfortable including in a crypto portfolio in 2024 are Bitcoin and Ethereum, notwithstanding their recent volatility. In addition to providing investors with unmatched returns, the fact that both cryptocurrencies have been operating for over a decade attests to their serious durability. Let’s examine what sets them apart in more detail.
Bitcoin
Bitcoin remains crypto investors’ gold standard. Bitcoin is often called “digital gold” because it has qualities similar to genuine gold. Most notably, Bitcoin has a 21 million coin limit. With roughly 20 million coins in circulation, essentially all of Bitcoin’s future has been created. Bitcoin is extremely scarce, so some crypto investors horde it like gold. More than any other crypto, Bitcoin is based on long-term buy-and-hold. Bitcoin Rule #1: Never sell Bitcoin. Bitcoin investors have coined words like “HODL” and “Diamond Hands” to describe keeping onto their Bitcoin regardless of the crypto market.
Also Read: “Future of Bitcoin: Price Predictions and Market Influences”
Given how often we hear about Bitcoin speculators, the number of long-term holders may surprise us. Glassnode reported approximately 14 million bitcoins held by long-term investors in mid-June. This underestimated property of Bitcoin provides it great longevity. Institutional investors investing in Bitcoin should support the buy-and-hold mentality among smaller retail investors. Finally, Bitcoin’s longevity is unquestionable. Cathie Wood of Ark Invest says there have been at least five Bitcoin price drops of 77% or greater. Guess what? Every time, Bitcoin’s price recovered. Bitcoin recovered swiftly from its November 2021 low. Bitcoin rose over 150% in 2023 and 30% in 2024.
Ethereum
If Bitcoin is “digital gold,” Ethereum is “digital silver.” Ethereum may not be as popular as the world’s most popular cryptocurrency, but investors seeking protection in a volatile crypto market consider it. Ethereum’s massive blockchain ecosystem is one explanation. Crypto investing is risky: This ecosystem affords Ethereum unmatched diversity. Equity investors can view Ethereum as a versatile blockchain conglomerate. Developers can build on Ethereum’s Layer 1 blockchain network to create new goods and services. Examples include new crypto tokens and DeFi exchanges.
Ethereum’s global developer network and diverse blockchain solutions make it a good hedge against crypto market instability. If one blockchain niche underperforms, another may be doing well. As an example, a “metaverse coin” can vanish overnight if a trend or story loses support. Ethereum excels at all it does. None of the contenders have succeeded in overtaking Ethereum as the top Layer 1 blockchain network. Ethereum dominates Total Value Locked (TVL), a crucial DeFi indicator, with 60%. Many investors will pay more for market supremacy.
Make a purchase and hang on for the ride
Seventy percent of the cryptocurrency market’s valuation is currently attributed to Bitcoin and Ethereum combined. Since only Bitcoin and Ethereum now have their own spot ETFs, that number has the potential to keep rising. More institutional and ordinary investors than ever before can purchase Bitcoin and Ethereum. Financial resources should thus keep pouring into both, regardless of the state of the market as a whole. There aren’t a couple of other cryptocurrencies that I would want to keep in my portfolio for the long term. They have both achieved success in the past and will continue to do so in the future. Cryptocurrency investments are not without their risks, but cryptocurrencies like Bitcoin and Ethereum have proven time and again that they can overcome challenges.
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In Summary
Market volatility, regulatory uncertainty, and digital asset evolution make crypto investing risky. Some cryptocurrencies have survived in this tumultuous environment, appealing to investors seeking stability. Digital currencies include Bitcoin and Ethereum. Bitcoin, the first cryptocurrency, is over a decade old. It is considered “digital gold” and a popular store of value during economic downturns as the first and most famous cryptocurrency. Bitcoin is resilient to market downturns due to its decentralization, widespread use, and limited availability. The market’s second-largest cryptocurrency Ethereum has also survived. Ethereum allows smart contracts and dApps, unlike Bitcoin. Its adaptability and upgrades, like Ethereum 2.0, boost scalability and energy efficiency, solidifying its crypto market position. All investments involve risk, but Bitcoin and Ethereum have demonstrated they can endure market volatility, providing investors confidence.
Also Read: Staricrypto.com
