The oldest and most widely accepted cryptocurrencies are hitting the headlines every day. Most of the new investors are seeking to create a portfolio that will last for the years ahead and, what’s more, the one that will appreciate the most. But, Which Is A Better Investment? Bitcoin, Ethereum, Or Dogecoin?
To understand which coins you should hold for the long term, which you should trade, and which you should sell and forget, you need to analyze data. Hard facts will tell you more than any seasoned analyst. Luckily, all the useful data regarding crypto assets is available over the Internet for free. Let’s explore some of the most prominent facts about the most popular cryptocurrencies and see what conclusions can we draw from them.
Best Cryptocurrency Performers Of 2021 – Bitcoin, Ethereum, or Dogecoin?
The front runners of this year have been explored by the researchers. Interestingly enough, a few surprising facts have emerged.
The most expensive crypto coin and the world’s champion Bitcoin holds only sixth place by the price growth in 2021. That’s a good reason to think harder about your whole investment strategy!
The first place belongs to the most meme-able cryptocurrency Dogecoin. The staggering 7555% growth since the beginning of the year drives it far beyond other digital assets. But, the question is, is this trend going to last? To understand this, you certainly need to research more deeply into the statistics of Dogecoin.
Another champ that is not as popular as Bitcoin but shows more appreciation is Maker with its 760% growth. Maker DAO is an ambitious DeFi project that democratizes access to a range of financial services that were previously available only in official financial institutions like banks. And while DAI, which is a popular stablecoin works as a cryptocurrency that issues upon someone takes a loan backed by ETH, Maker or MKR for short, is a governance token within this network. Maybe the fact that Maker ecosystem has been the pioneer on the DeFi stage, has set the tone for its widespread adoption.
As a result, MKR is trading at nearly $2,000 after being around $6,000 only a month earlier. At the same time, Dogecoin trades at $0,18 in June 2021, after its previous market peak at around $0.55 in May 2021.
The third place on this list belongs to Ethereum and its growth of 324%. The oldest cryptocurrency Bitcoin has shown a 113% growth.
How important is the coin’s growth?
Growth rate of an asset is traditionally important in financial markets. A lot of the analytical formulas from the fundamental finance principles like the Gordon growth model suggest that you need to take into account the growth rate.
However, the cryptocurrency markets are fairly new and unorthodox, that’s why they may not function by the rules of Wall Street. For sure, everyone is excited by the sudden growth of the coin as it happened to Dogecoin. Famous celebrities and the richest people in the world have been promoting its rise “to the Moon” and lots of people across the world believed it. As a result of the continuous buying trend, Dogecoin surged in price. However, as you could see in the statistics earlier, it didn’t survive the market crash called “Black Thursday.”
After Elon Musk voiced concerns about the eco-friendliness of Bitcoin and to boot, Tesla sold a part of their Bitcoins at peak prices, it led to an unexpected avalanche effect. Other investors started to sell massively. As a result, on most exchanges that support protection limit orders (so-called stop loss and take profit limits) automatic liquidations also occurred and the market crashed like a house of cards.
Since Bitcoin accounts for almost half of the overall crypto market cap, it is no surprise that literally all the altcoins followed the BTC trend.
Also, the decreases in prices were somewhat proportional. It’s not like the leading coin by growth Dogecoin has fallen to zero. In fact, the Dogecoin price fall from 55 cents to 18 cents was about 32% and the MKR price fall from $2,000 to $6,000 is roughly 33%. It’s also an interesting fact that you should take into consideration.
So what conclusions can we draw from watching the coin’s growth and price fluctuations? For sure, the one-time snapshot of the market doesn’t bring enough information for you to make long-term decisions.
On the flip side of the crypto coin, the growth percentage is an important indicator that the market for this coin is currently active. That’s why it can bring good opportunities for experienced traders in case if they make informed decisions regarding their strategy on the way. Yet also, it can show that the asset is currently overpriced (that happens every time the order book on the Buy side is much bigger than on the Sell side). Be careful of such trends because if the cryptocurrency will stop being as popular as before, you will struggle to sell the coins you previously bought, not to mention asking a profitable price for them.
You may want to seek where to purchase Ethereum instantly online if you want to instantly buy or sell Ethereum or some other crypto. Look for a regulated exchange – this will ensure the safety of your funds and good trading liquidity anytime you might need it. Decentralized exchanges are also an option for those who already own crypto and don’t need to exchange it for fiat money or vice-versa.
In any case, before making any big decisions regarding crypto, you always need to remember the rule of thumb – do your own research.
Author: Abby Bootman from CEX.IO
Disclaimer: This is a guest article. The views, positions and opinions expressed in this article are those of the author alone and do not represent those of AlexaBlockchain. The accuracy, completeness and validity of any statements made within this article are not guaranteed by us. AlexaBlockchain accept no liability for any errors, omissions or representations. The copyright of this content belongs to the author and any liability with regards to infringement of intellectual property rights remains with them. THIS IS NOT AN INVESTMENT OR FINANCIAL ADVICE. Any content found on this website named AlexaBlockchain is an opinion of the author who produced the content and is for information purposes only. Any information, or content found within the website AlexaBlockchain is not intended to be investment or financial advice.