The crypto market is currently going through a recovery phase, led by the big two (Bitcoin and Ethereum), which have grown over 20% since their lowest valuation in January. The trend has not yet permeated to all other currencies, and even the ones that are recovering at the same pace and are following the same trajectory as the two leading cryptocurrencies might still be intelligent buys before they become too expensive.
A crypto asset that hasn’t started recovering yet
While Polkadot (CRYPTO:DOT) did start recovering at the same time as the other two, its rise was temporary, and it’s already down to its former depth (quite near it). The current price the crypto is trading at $24.1 is a long way down from its peak value at $67, and if you buy now, and the crypto asset grows just a little over its former peak during its recovery (about $73), you would triple your capital.
If you had bought the coin in Oct. 2017, when it was first offered for about US$0.29 a share, you would have grown your capital by over 60 times by now, and that’s after the dip from the peak. And even though it’s highly unlikely to go below $1 anytime soon, and that level of growth potential is far gone, buying now when it’s dipping and holding on to it for a long time might get your capital a very attractive multiplication factor.
Its ability to connect different blockchains also makes it a solid long-term prospect.
A cryptocurrency that’s already recovering
If you are looking for a crypto that’s already on its way up, Avalanche (CRYPTO:AVAX), which, ironically, didn’t fall nearly as far low as its name would suggest, would be a good pick. The crypto is already up from its lowest (during the last dip) $75 to its current $115, which is significantly closer to the peak valuation.
However, it has passed the point where it would have doubled your capital if you bought now, and it only grew to its peak value ($170). But this crypto may have enough upside to top that point in the coming years.
It’s more than just another Ethereum alternative. The Avalanche primary network is actually made up of three blockchains instead of just one, and all three have different utilities. One facilities exchange, one is for smart contracts, and one allows for creating other custom chains. The latter two follow a consensus protocol unique to Avalanche: Snowman consensus.
Foolish takeaway
Most cryptocurrencies have become mainstream and mature enough (as investment assets, not medium of exchange) that the “usual” capital-appreciation potential they offer is now more comparable to growth stocks than it is to the former monstrous growth of these cryptos in the last few years. However, the pace of growth still helps the crypto assets stand out.
