on the crypto
Bear markets are no fun. But despite the short-term pain, these difficult market conditions create an opportunity for investors to acquire industry-leading assets at a discount to previous highs. Let's see why Bitcoin (quotation BTC) and Ethereum could be a great way for investors to bet on a long-term rebound in cryptocurrencies.
1. Bitcoin
With a current price of $ 30.100, Bitcoin is down 56% from its all-time high of around $ 68.800, reached in November 2021. But this decline could be a good entry point for investors, as the long-term bull thesis. term of the iconic asset as an increasingly reliable store of value remains intact.
The power of the first mover advantage should never be underestimated. An entity's name is recognized, which can translate into trust and stamina. And after the Earth / Moon failure (a $ 40 billion blockchain that collapsed 99% after the failure of its complex stablecoin algorithm), Bitcoin looks even more attractive. Its relatively simple design and 13-year history make it ideal for investors who want a reliable place to store and potentially grow their wealth without all the frills.
Bitcoin's strong brand has also earned it institutional interest from organizations such as the derivatives market CME Group, which offers Bitcoin futures (alongside Ethereum). Institutional investments can help improve the liquidity of the Bitcoin market and reduce its volatility compared to more speculative and illiquid cryptocurrencies.
2 Ethereum
Second most important cryptocurrency, with a market capitalization of $ 223 billion, Ethereum enjoys the same trust and brand recognition that gives Bitcoin its staying power. But the asset's utility and ambitious development roadmap will give it a long-term advantage over its rivals.
Unlike Bitcoin, which is primarily used to store and transfer wealth, Ethereum boasts a much broader use case. The blockchain is optimized to support standalone programs called decentralized applications (dApps), which use smart contracts to offer services on the blockchain. And it is the undisputed leader in this category, hosting nearly 3.000 of the approximately 4.000 projects.
To keep up with demand, Ethereum developers are rolling out an ambitious update called The Merge, which will move Ethereum from a proof-of-work consensus mechanism, in which miners solve puzzles to verify transactions and mint new coins. , to a proof-of-stake, where users can verify transactions by blocking or staking existing coins in exchange for new ones.
The first phase of this process is expected to go live in August, reducing Ethereum's energy consumption by more than 99% and paving the way for further changes to improve the speed and scalability of the platform.
Becoming greedy when others are fearful
The temptation to buy when prices rise and sell when prices fall is strong, but investment legends like Warren Buffett advise the opposite. Buying during a bear market allows you to enter cheaper and capitalize on the potential recovery. Industry leadership and active development of Bitcoin and Ethereum could make them the best choice for investors who want to be greedy when others are fearful.
