The cryptocurrency market is in the midst of a bear cycle and likely has been for the past year. A lot of highly speculative cryptocurrencies and memecoins may never recover to see new all-time highs, which makes diligent investment decisions more important than ever. Let’s take a look at four of the most solid cryptocurrencies available at a discount that have the best chance of recovering in the next bull market.
The first choice for bear market buyers is also the safest and most obvious: Bitcoin. As the largest and most well-known cryptocurrency, it also is subject to the least volatility and has the highest chance of reaching a new high. Bitcoin is the backbone of the entire cryptocurrency industry, and thus is a solid buy for anyone who believes in the long-term potential of the cryptocurrency market. Additionally, Bitcoin has a lot of institutional interest and could see a big recovery if a spot ETF is approved in the United States. In every prior bear market, Bitcoin has fallen to the previous bull market’s high before recovering to reach new highs in the next bear market. For example, Bitcoin started 2017 at around a thousand dollars, ended that bull market at $20,000, fell back to $3,000 in the next bear market, then shot up to $60,000 in 2021. It is currently down over 50% from its all-time high. As long as Bitcoin is associated with the entire cryptocurrency market, it will be seen as the safest and strongest investment in the industry.
The second pick, although also obvious, has one of the highest potential and lowest risk profiles of any cryptocurrency to date: Ethereum. The Ethereum blockchain is currently the king of smart contract platforms and has over $51 billion in total value on the chain and 59% of the smart contract market share. Moreover, Ethereum will be having its Merge event in a few months, which will see the blockchain switch from proof of work to proof of stake. This will not only reduce the energy consumption of the Ethereum blockchain by 99.97% but also make ETH a deflationary currency and have a yield rate of 4–6%. This supply contraction, along with the ability to earn a high yield, should help to skyrocket the price of ETH to never-before-seen levels in the next bull market.
Even with Ethereum’s merge and deflationary supply, it will still have issues relating to congestion and high fees that will keep it from reaching its full potential. There are solutions that will help scale Ethereum that are set to release over the coming years, but users need low fees and high transaction throughput right now. For that, the Polygon platform and its native MATIC token offers a solution. Polygon is building a full toolkit to Ethereum that allows for several different unique features, namely scalability without sacrificing on security. Their technology and roadmap has massive potential and will likely be the main scaling solution for Ethereum. Their Polygon sidechain is one of the biggest smart contract platforms alongside Ethereum, and they are planning on releasing several more over the coming years. Polygon and Ethereum are becoming more intertwined and integrated, and a bet on Polygon and MATIC is a bet on the dominance of the Ethereum ecosystem.
One of the undeniable trends in blockchain is the growth of smart contracts and decentralized applications. Smart contracts have allowed for all sorts of revolutionary creations, such as decentralized exchanges, gambling platforms, insurance, and many other financial tools. Most of the time, smart contracts reference data not available on the blockchain, such as asset prices, to be more accurate and secure. However, it is impossible for smart contracts to access real-world data without an oracle solution like Chainlink. Every time a smart contract on essentially every relevant smart contract blockchain grabs data from the real world, they are required to use the LINK token as payment for this data. This means that Chainlink is the closest thing to a bet on the future prevalence of smart contracts. Additionally, a staking feature for LINK is supposed to be coming out before the end of the year, which will drive even more demand for the LINK token.
Even though the bear market is in full swing, there are still cryptocurrencies and projects that have a solid future and will likely survive to see new all-time highs. When this happens, investors who are buying now will reap the rewards of having a high conviction and their willingness to take risks. Whether or not these aforementioned cryptocurrencies will survive is unknown, but their fundamentals suggest that they will be here to stay.
By Lincoln Murr