2 Crypto Assets to Buy for the Long Haul

When you are looking for cryptocurrencies that you can potentially hold for years to come, you should look for more than just past performance.

crypto, chart, stocks

Image source: Getty Images

When it comes to crypto assets, trading is almost as famous as long-term investing — probably even more so. The main reason is the volatility of the crypto assets, which makes trading more exhilarating, even practical. But that doesn’t negate the fact that the long-term investment approach cannot be applied to crypto assets.

However, you cannot assess the long-term crypto investments quite the same way you assess stocks. The speculative nature of cryptocurrencies and the fact there is little tangible behind those assets make them a little difficult to comprehend. But even that statement is not valid for all crypto assets. Mainstream cryptos like Ethereum (CRYPTO:ETH) have billions of mining assets tied to them and billions more in secondary markets like NFTs.

That’s an important perspective to have when you are choosing crypto investments for the long term.

The second-largest cryptocurrency

Ethereum is almost as well known as Bitcoin, and it’s one of the few cryptocurrencies that are being mined as vigorously, even by publicly traded miners. But it’s well known for much more than just a volatile investment asset. It garnered a significant segment of the smart contracts market early on, and this is one use of blockchain that might outlive the cryptocurrency hype.

Ethereum is also widely used to create Decentralized Finance (or DeFi) applications, which is tied to the true purpose of the cryptocurrencies — financial freedom and accessibility to everyone, without going through financial institutions (conventional banks). Ethereum also controls the bulk of the NFT market, which is blowing up right now, and the potential of similar derivative markets in the future is quite bright.

With all these uses, crypto is likely to stay relevant for decades to come. So, buy the dip and hold on to it.

An Ethereum alternative

Due to its versatility, Ethereum has triggered the creation of a lot of similar blockchain and their native cryptocurrencies, one of which is Cardano (CRYPTO:ADA). It’s giving Ethereum serious competition in many avenues, including smart contracts, where the blockchain aims to become even more accessible and user friendly than Ethereum.

It’s also being used to create DeFi apps, and there is a high probability that it may get ahead given enough time, beating Ethereum’s early bird advantage. It’s also different from Ethereum in two significant ways: it has a different consensus mechanism (proof of stake), and it has two different layers: one dedicated to intelligent contracts and one to transactions, so one doesn’t weigh down the other.

Cardano is currently trading at a 68% discount from its peak, and from its trajectory, it seems that the crypto might fall further for a while before recovering. Even if it just reaches the current peak, it would grow your capital by over 300% if you buy now. And if it goes beyond that point, your capital appreciation can be phenomenal, much higher than the relatively heavier Ethereum and much heavier Bitcoin.

Foolish takeaway

If you are unsure about crypto assets themselves, many crypto-oriented tech stocks can be healthy alternatives. Many of them offer relatively broader exposures, and even the direct crypto miners can offer more growth than the underlying cryptos can.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns and recommends Bitcoin and Ethereum.

More on Cryptocurrency

bulb idea thinking
Energy Stocks

Get In On the Action – How to Invest In the Hottest Trends Now

Are you looking to make a fortune from stock markets? Then you have to invest in the hottest trends that…

Read more »

cryptocurrency, crypto, blockchain

After a Rollercoaster February, Is Galaxy Digital Stock a Buy?

Galaxy (TSX:GLXY) stock soared by 30% before dropping by 21%, so what's been going on, and should investors get in…

Read more »

consider the options

Should You Buy Galaxy Digital Stock Right Now?

Galaxy Digital Holdings is down 80% from all-time highs, but should you buy this cryptocurrency stock right now?

Read more »

New virtual money concept, Gold Bitcoins
Tech Stocks

These 2 Stocks Carry a Lot of Risk, But Their Upside is Huge

If you want windfall gains, you have to risk losing what you invest. These two stocks with disruptive technology could…

Read more »

cryptocurrency, crypto, blockchain

Is Hut 8 Stock a Buy in December 2022?

Hut 8 Mining Corp. (TSX:HUT) stock has been throttled in the face of a crypto bear market. It still looks…

Read more »

cryptocurrency, crypto, blockcahin

HIVE Blockchain Stock Fell 18% In October – Is It Time To Buy? 

Hive Blockchain (TSXV:HIVE) stock is down with the crypto market but ready for a BTC rebound.

Read more »

crypto, chart, stocks

2 Top Cryptocurrencies to Buy in October 2022

Ethereum and Solana are two of the most popular cryptocurrencies in the world that are well poised to deliver substantial…

Read more »

Hand arranging wood block stacking as step stair with arrow up.

2 Cryptocurrencies to Buy for Potential Recovery

The largest and most liquid cryptocurrencies may not always be the first to recover, and you may have to go…

Read more »