By February 13, the total capitalization of the crypto market for the day increased by $ 17.6 billion, and the rate of the first cryptocurrency in the world rose by more than 10% to $8759. According to experts, bitcoin will be followed by other cryptocurrencies, which will be the end of the bearish cycle, and investors will return to the crypto market. We considered cryptocurrencies, which, according to analysts, will bring high profits in the long term.
Advantages of investing in long-term: how to determine a promising cryptocurrency
Each capturador chooses the best and suitable strategy. However, experienced crypto investors warn traders against participating in short transactions at this stage of market development due to potentially high risks. In their opinion, the best strategy now is to invest in a long — term position.
Unlike day traders who make deals with cryptocurrencies within the same trading session, investors who prefer to invest in debt, face lower risks, are not subject to such high stress and pay less fees. And to combat the high volatility of cryptocurrencies experienced traders use the method DSA (averaging dollar value), which allows them to increase the portfolio by investing a fixed amount in dollars at regular intervals.
In order to determine the value of the cryptocurrency and its prospects, analysts consider the following factors:
Market share. The share of each cryptocurrency in the market can be calculated by comparing its market capitalization with the total. The larger the share, the stronger the position of cryptocurrency on the market. For example, today the market capitalization of bitcoin is more than 1/3 of the total — 34.9%. This ratio can be used as an indicator of the long-term viability of the cryptocurrency in your portfolio.
The value of utility. To objectively assess the potential of any cryptocurrency, you need to know the answers to the following questions: what is the practical value of this coin, and whether it has a market and users. This is important, because it is possible to understand what cryptocurrencies can become commonplace. For example, one of the key useful advantages of ether and the Ethereum blockchain consists in the possibility of development and implementation of decentralized applications (DApps). While developers choose this particular blockchain to run their DApps, the overall utility of the ether will not only be stable, but, perhaps, will grow over time.
Transaction volume. The daily volume of transactions shows how much cryptocurrency is in demand among the participants of the crypto market. For example, at the moment, bitcoin passes about 195,115 transactions per day, at the ether — 799,836, and at the ripple — 809,646. This indicator usually grows with the development of cryptocurrency, which makes it a promising long-term asset in the portfolio.
Liquidity. High liquidity, as well as the volume of transactions, shows how much cryptocurrency is in demand in the market. Moreover, these two indicators are interlinked. Liquidity is defined as the ability of assets to be sold quickly at a price close to the market price. Low liquidity leads to high volatility, which causes a large-scale and tangible change in prices in the market. At the same time, higher liquidity creates a less volatile market, and the quotes of cryptocurrencies are already changing not so much.
Technology development. This is perhaps a key aspect of any cryptocurrency. If the technology on which the cryptocurrency is based can not fulfill its objectives, then in the long term this coin will not survive. For example, the Ethereum network has undergone a hard fork of Byzantium, which is the first part of a large-scale Metropolis update aimed at optimizing this blockchain network. Thanks hardface Ethereum now has a more rapid transaction processing, but at the same time reduced the award for the block from 5 to 3 ethers.
Market news. It is the news background around the cryptocurrency that can significantly affect the growth or fall of its price, as well as the long-term viability and the size of the investor's portfolio. In this connection, it is important not only to follow the news, but also to be ready to respond to them in a timely manner.
Cryptocurrencies in the long term
When choosing a cryptocurrency for long-term investment, in addition to their own analysis, it is also worth to see the cryptocurrency indices. They will help to form an idea of the overall dynamics of cryptocurrency quotes and investor sentiment. To date, such cryptocurrency indices as CRIX, Hold 10, CAMCrypto30, as well as two crypto — currencies and tokens DeCenter-DCI and DCI50 are available on the market, the list of which is recalculated quarterly. DCI includes 10 tokens and cryptocurrencies with the largest capitalization, while DCI50, also known as altcoins index, includes 50 cryptocurrencies except bitcoin.
The most reliable and promising cryptocurrencies of 2018:
Ether ETH
The second cryptocurrency in terms of market capitalisation differs from bitcoin in the first place. Bitcoin is a means of storing and accumulating capital, and ether is created to work in the Ethereum network, in which users have access to work with smart contracts and DApps development. Cryptocurrency is also in partnership with one of the largest non-commercial alliances, the Enterprise Ethereum Alliance, consisting of financial and technological companies and funds, including the Russian Sberbank. According to investors, the ether rate this year will overcome the mark of $2000 and during 2018 will aim at $5000.
Price: $838
Market capitalization: $ 81.7 billion
Daily trading volume: $ 2.2 billion
Growth rate for the year: $11 - $838
Amount of coins: 97,585,773 (the current volume)
Litecoin LTC
If bitcoin is a digital gold of the crypto market, and ether is a digital oil, litecoin is a digital silver. Appeared as a result of hard fork Bitcoin coin network was founded by the famous developer Charlie Lee as a way to solve existing problems in bitcoin. Since litecoin has a faster confirmation of transactions, low fees and increased storage efficiency. In 2018, the team litecoin many plans, for example, the creation of new payment services LitePay and LitePal. According to investors, by the end of the year litecoin rate will be at $1000 per coin.
Price: $159
Market capitalization: $ 8.5 billion
Daily trading volume: $ 519.6 million
Rate growth for the year: $3.72 − $159
Amount of coins: 84 million
Monero XMR
Monero cryptocurrency appeared in 2014 as a result of the hard fork of The bytecoin network. The main advantage of monero is that it is a secure, untraceable and anonymous cryptocurrency that provides complete privacy for users. This is possible by using the CryptoNote Protocol, which is based on ring signatures. In 2017, the cryptocurrency entered the top ten market capitalization. However, among the critics of Monero, it is widely believed that this cryptocurrency is popular on the black market: it and other anonymous cryptocurrencies are used for the sale and purchase of drugs and weapons. According to investors, the rate of monero by the end of 2018 will fluctuate between $470 and $530.
Price: $ 230.5
Market capitalization: $ 3.6 billion
Daily trading volume: $ 42.7 million
Growth rate for the year: $12.2 - $230.5
Amount of coins: 15,716,443 (the current volume)
Ripple XRP
The Ripple Protocol was launched in 2012 in China as a global system of mutual calculations in real time, which allows to carry out money transfers and currency exchange. Ripple's goal is to provide instant and at the same time secure financial transactions around the world. Thus, Ripple becomes the main competitor of SWIFT or Western Union. As for the ripple cryptocurrency, it exists to maintain the platform and allows you to conduct financial transactions and exchange any other currencies. Experts predict that in 2018 Ripple will become the preferred cryptocurrency for banking transactions around the world, and the rate will vary between $5 − $7.
Price: $1.03
Market capitalization: $ 41.6 billion
Daily trading volume: $ 1.2 billion
Rate growth for the year: $ 0.006 − $1.03
Amount of coins: 100 billion
NEO
Neo cryptocurrency is similar to Ethereum in many ways, but many analysts believe that NEO will become a platform for the future decentralized economy. NEO, a non-profit blockchain project launched in China in 2014, aims to develop a decentralized "smart economy" designed to create and manage digital assets through smart contracts. In partnership with the project are companies such as Microsoft China, Hyperledger and Alibaba. The Chinese government is also interested in the introduction of public digital identification services developed within the framework of the project. Experts believe that in 2018 the project will continue to develop, in connection with which the value of the accompanying cryptocurrency will grow, the rate of which will be between $200 − $250 by the end of the year.
Price: $ 110
Market cap: $7.1 billion
Daily trading volume: $ 192 million
Rate growth for the year: $0.12 - $109.57
Amount of coins: 100 million
Stellar Lumens XLM
Cryptocurrency platform Stellar-Lumens-experts call one of the most promising. In 2014, Ripple co-founder jed McCaleb together with Joyce Kim, Stellar launched as an offshoot of the Ripple network. The Stellar platform provides real-time currency transactions. From the very beginning, the developers of the project noted that one of their goals is to adhere to the principle of maximum transparency. Such companies as Deloitte and IBM are interested in the development of the project, and the organizers of the ICO begin to transfer crowdsales to the Stellar platform. According to analysts, in 2018 XLM will overcome the mark of $1.00 and grow to a value of $1.25.
Price: $0.37
Market capitalization: $7 billion
Daily trading volume: $60 million
Rate growth for the year: $ 0.0021 − $0.37