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When it comes to the crypto market, there are two types of traders. Ones who take advantage of crypto volatility by making quick transactions and the other type of traders who buy crypto with long-term investment in mind and hold on to it for an extended period of time.
Today we will discuss the second type of investment, aimed at long-term traders. When it comes to long-term investments, there are different types of investments a trader could make. We can buy already well-established cryptos that have high profitability or buy upcoming cryptos that are cheap now and have a high probability of growth.
Cryptos that have already established themselves on the market are usually the safest long-term investments, as they have strong teams behind them and already gained the trust of millions of people, which is one of the biggest factors to look at when making long-term crypto investment predictions.
The undisputed giant of the crypto world, Bitcoin is usually seen as the best crypto to hold long-term. Despite Bitcoin being a volatile currency, in the end, it always sees gains and breaks different kinds of records consistently. If we ask any trader which cryptos are in their portfolio, Bitcoin will be on most of their lists.
At the start of 2022, Bitcoin and the whole crypto market saw huge losses. Compared to other cryptos, Bitcoin is usually less volatile in this kind of crypto winter. Based on the percentage of change, it has seen one of the least depredations compared to other well-established cryptos. But with this slump, came a piece of news that put Bitcoin on many peoples’ radar, and with Bitcoin halving approaching soon, it can be made even more valuable.
The biggest mainstay of retirement plans in the US, Fidelity Investments, announced in late April that, if allowed by the employers, they will give an opportunity to 401,000 investors to buy Bitcoin directly in their accounts. Fidelity is used by more than 21,000 companies to operate their retirement plans. This is a market that includes around 20 million people and assets worth $2.7 trillion. The question remains, how many companies will incorporate this feature? This is a big step for Bitcoin that will undoubtedly have a great effect on its value in the long run.
Another reason Bitcoin is the best cryptocurrency for long-term investment in 2022 is its history in crypto winters. With Bitcoin currently being 39% down, some people, especially those new to the Bitcoin market, might shy away from investing in it. But history tells us that it is one of the best times to invest in it for the long term. Bitcoin follows a trend that has repeated itself many times. Whenever Bitcoin sees a huge crash, it always starts to slowly recover and in the end, it usually hits record prices. So with the recent crash, there is a lot of speculation about it coming back like never before.
Ethereum has been playing the second fiddle to Bitcoin for a long time, and it's being seen as the “Second Crypto” by many traders. Operating on the Ethereum blockchain, what many don’t know is that it’s the most used blockchain in the world. In November 2020 it saw its highest valuation of $4,891, but with the recent market crash, it fell and now trades at around $1700.
Ethereum has been one of the cryptos with the most potential for a long time, as it was the first big cryptocurrency that introduced the world to fully decentralized finances (DeFi). This removes the need for traditional middlemen, like banks, brokers, and centralized exchanges and puts the power back into the hands of the people. One of its biggest weaknesses is its proof-of-work protocol, which has been seen as expensive, energy-intensive, and slow. Because of this, there has been the birth of many cryptos which rival Ether with their faster and less expensive, proof-of-stake protocols.
With the recent news of the “Merge”, Ethereum will be moving to a proof-of-stake protocol. Analytics suggest that right now Ethereum is one of the best long-term crypto investments that you can make in 2022, as the new protocol is expected to bring in new investors and break its record price of $4,891.
Another reason why Ethereum is one of the best long-term crypto investments is the birth of the NFT ecosystem. 2021 saw the rise of Non-Fungible Tokens (NFTs). Most of those NFTs are on the Ethereum blockchain, with many websites using Ethereum as one of the main currencies.
The Solana network is one of the biggest competitors of Ethereum. Recently it become a rising star in the crypto market, as it managed to muscle its way into the DeFi system and took a significant market share.
Compared to Bitcoin and Ethereum, which were birthed in 2009 and 2015 respectively, Solana is a newcomer as it started its operations in 2020. For the following year, it saw its price go from $1.5 to hitting its peak at $170 by the end of 2021. Things have slowed down since and Solana now trades for around $40-$50. Despite that, it’s still poaching users from Ethereum and is cementing itself as one of the front-runners in the DeFi market.
If we exclude stablecoins such as TetherUSD and USDCoin, BNB is the third-largest coin when it comes to market capitalization. With a market cap of $49 billion, it is one of the hottest crypto assets on the market. BNB is a native coin of Binance, which has cemented itself as the leading crypto exchange. Binance is leading the way in the buying and selling of digital assets, as it shows an average 24-hour trading volume of over $50 billion, which is significantly higher than its competitors.
One of the selling points for BNB is also its durability. With the recent crypto crash, BNB didn't see as huge of a fall as some of the other leading cryptos. It went from trading at $455 to $228, but immediately recovered and now trades at $313 and is seeing more improvement all the time.
With Binance expanding its operations every single day, BNB is attracting lots of investors for long-term investments, with the belief that it will more than double its value in 2-3 years.
Since its launch in 2020, Polkadot has become one of the best long-term cryptos to invest in. With its market share of $ 11 billion, it offers developers the opportunity to build innovative, decentralized systems alongside its native token DOT.
The main goal of Polkadot is to create a single unified network, by connecting different blockchains, and it also has the ability to create a new chain altogether.
Currently, Polkadot trades at $8. Its main competitor is Ethereum which is not an easy challenge to take on, but because of its early entry into smart contracts, analysts believe that it has an edge and a lot of room for growth.
We have discussed the best cryptos to hold long-term which have already gained some recognition and grown a dedicated community around themselves. But there is another type of crypto that some people think is a good long-term investment. These are the cryptos that are new to the market and don't hold a massive amount of value just yet.
Everyone says that this crypto market crash is going to shake up things pretty hard. This is the best opportunity for new projects to rise and establish themselves on the market.
So who should buy these cryptos for long-term investing? It will be a really bad decision to put a lot of money into cryptos like that because 90% of those projects won't see the light of day. The best way to invest in those projects is to invest a small amount of money in a few different projects. Generally, these tokens are really cheap which allows us to buy a large quantity of them for a small amount of money and hold them for a long period of time. If it succeeds we will see huge profits, but if it fails we won’t be making huge losses. So, if you have a few extra bucks to throw around, investing in these types of tokens and holding them is a good idea.
DeFi Coin is one of the best new cryptocurrencies to buy right now. Despite the market crash, DEFC saw big gains after DeFi swap announced the launch of its much-anticipated crypto exchange.
One of the most notable features that DEFC has is that it was designed with long-term investing in mind. It gives investors a reason to hold on to the coin even if prices go up, as with every DeFi coin sale comes a 10% transaction fee. Another great feature that the DeFi platform offers is that it allows users to stake their tokens for high rates, 30%-75% APY if you lock in your token for 365 days.
Another token that traders are looking at is Terra's new LUNA token. After TerraUSD and TerraLUNA crashed and lost their investors millions of dollars, Terra announced that it will be ditching its old coin and will be launching Terra 2.0 with a new LUNA token.
When Terra first joined the crypto ecosystem it saw huge gains and gathered a big community of investors, but after some miscalculations within its algorithm, all of that hard work turned out to be meaningless. Terra developers are not giving up, and with the launch of the new Terra token, investors are putting some money into it, with hopes that it can gain the same popularity as its predecessor.
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Bitcoin can be considered the best crypto for long-term investment. It has a good history with somewhat predictable price movement patterns. So if purchased at the right time, it can be a great investment to hold for years.
In general, the crypto market is highly volatile. It is not surprising for assets to have price fluctuations of around 8-10% throughout the day, so it is way more profitable to day-trade with cryptocurrencies. But this does not mean that long holding is bad. If approached correctly, this investment strategy can also return good profits.