The last two months have been rough for major cryptocurrencies, and most of them ended up in the red. The information background has undoubtedly greatly contributed to this. Among other things, it’s worth mentioning the hacking of the Bithumb exchange – an event that knocked Bitcoin below the support trend line, which had been holding it back for more than three months.
After sinking below the MA200 level, bitcoin has been steadily moving in the descending channel for almost two months.
Аnd this is, by the way, a great opportunity to earn from the bearish market, by opening short positions.
So, if you decide to ”short” bitcoin the first question you need to ask is: where and how? Should you choose from a great many of cryptocurrency exchanges, which number has tripled over the past year, or make your choice in favor of a broker that allows you to trade cryptocurrencies paired with other financial instruments? Let’s compare an “average crypto exchange” with the world’s leading brokers.
From the point of view of security and trust, the answer is obvious – crypto exchanges have appeared relatively recently, and countries are only beginning to draw up rules and enforce regulations. So, nothing prevents any of such exchange from closing one day, appropriating client assets, or simply losing them as a result of a cyber attack. Similar events happened in summer 2017 and in January 2018.
And what about brokers then? Most brokerage companies have been operating in the market for a long time, and being a regulated broker is of great importance.
At the end of this brief comparison, we would like to mention another small, but important thing: crypto-exchanges offering margin trading can be counted on the fingers of one hand. And even among those few, the process is still implemented inadequately. Opportunity to open buy and sell positions at the same time is only provided by brokers. Brokers offer a hedged margin, which means that losses from one open trade can be covered by the profit from another! This makes trade safer, allowing you to lock positions and apply different strategies.
Now, let’s have a look at other promising cryptocurrencies that could show good results and bring profit, in addition to the giant and sluggish bitcoin. Let’s consider 6 cryptocurrencies that have all chances to outperform bitcoin.
Litecoin (LTC) – the first after BTC
Litecoin is essentially a clone of bitcoin, but with a different encryption algorithm, which makes it faster in comparison with bitcoin. By the popularity in the darknet market, it is the second most popular currency after bitcoin. Although the purchase of goods and services on such sites is much more suitable with almost entirely anonymous Monero, the popularity of litecoin is explained by its longevity: the cryptocurrency was launched in late 2011.
Another factor in favor of litecoin is that it uses SegWit technology, which indicates the readiness for Lightning Network. Thus, litecoin can benefit from atomic swaps – trading coins without the participation of a third party (ie the stock exchange), and since LTC keeps its code largely synchronized with bitcoin, it has good perspectives for technological progress.
Ethereum (ETH) – smart and trusted
Many crypto enthusiasts don’t even bother to ask themselves whether Etherium can surpass Bitcoin in terms of market capitalization, to them, it seems just a matter of time.
At the moment, Ethereum (ETH) is facing a couple of small challenges. First, governments are cracking down on the ICO and not without reason: many of them turned out to be either fraudulent or unsuccessful. If reasonable rules are adopted to protect investors from scam and useless projects, Ethereum will be firmly entrenched as a platform for digital ICO.
The second problem, threatening Ethereum’s “well-being” is its long-drawn transition to a new Proof of Work / Proof of Stake hybrid system. Etherium is currently highly profitable for GPU mining, but with recent rumors that Bitmain is launching powerful Ethereum ASIC miners, the GPU mining profitability could be ruined. However, if the creators decide to make changes to the code which will leave ASIC manufacturers out of the game, like the creators of Monero did, Ethereum will manage to deal with these challenges and stay afloat. If not, then it will most likely give way to the Chinese NEO, the so called “ether on steroids”.
Monero (XMR) – undercover
Montero is growing not so fast, but steadily. Its capitalization is constantly increasing and crypto investors are quite interested in this coin. This interest can be explained by a number of reasons. Although its adoption in the darknet market is not everything it could wish for, Monero remains the main anonymous cryptocurrency. Its reputation and market capitalization allows it to stay ahead of its competitors – and for a good reason.
The fact that Monero has recently changed its PoW algorithm in order to keep the network ASIC-resistant, confirms its commitment to decentralization. And the new version of Monero, 0.12, contains other improvements that demonstrate that Monero continues to evolve under strict supervision by its creators, who care about investors.
ETC (Ethereum Classic) – safe harbor
The Ethereum Classic was created in July 2016, as a result of the fork with the second largest by the capitalization cryptocurrency and its decentralized applications development platform (Ethereum).
The main factor that can boost Classic Ether is the last year’s hard fork, which resulted in the 20 million decrease in ETC issue, to 210 million coins. Immediately after this event, ETC charts went up. This is the main aspect that will affect the cost of Ethereum Classic. It should be also noted that ETC is immune to future hard forks. Another factor, although less important, is the attractiveness of ETC for mining.
To calculate the growth ceiling for Ethereum Classic we should take its maximum price – $ 45.51, registered on January 14, 2018 as a basis. The price has made three unsuccessful attempts to break through this level, but failed and went deep down. However, this steep downward correction can be considered a prerequisite for another attempt to surpass this barrier for the fourth time. According to our forecasts, after the price climbs above $45 level, we can expect another increase of 40% to follow (based on the previous movement, demonstrated by the price when it approached these levels), i.e. this year, one should expect 1 ETC in the region of $ 63. After that, the correction in the range of 45-50 dollars is most likely to commence.
Ripple (XRP) – the biggest plans
To analyze the prospects of Ripple, we should first consider the current banking system and currency transfers in US dollars, Euros and Yen. As you already know, Ripple was originally designed to replace the SWIFT payment transfer system and to become one of the main competitors of VISA and MasterCard. In the community, there is an opinion that it is Ripple that can replace the world currency itself, and not Bitcoin, which transaction confirmation mechanism is more time-consuming and less efficient. The ripple network handles thousands of transactions per second, which leaves bitcoin and etherium far behind.
Another argument that says in favor of bright prospects of this digital asset is its cooperation with major global banks, like Bank of America, Royal Bank of Canada, and with many other financial companies, which are currently introducing XRPs xRapid technology.
No digital currency can beat Ripple in terms of transaction commission either – its minimum transfer fee is $ 0.0007, in bitcoin network its $ 1.43, VISA payment system charges $ 2. Feel the difference!
Like we’ve said before, Ripple is an obvious competitor for all currently existing systems that perform payment transfers. According to some reports, VISA’s transaction volume amounts to 9 trillion dollars, and MasterCard accounts for another 4 trillion, i.e the total transaction volume of these two main giants is about 13 trillion dollars, not including other payment systems like Maestro, PayPal, etc.
Ripple network developers have created 100 billion coins. Every month in the next 50 months 1 billion will be added to the already existing amount, i.e. by 2023, all coins will have been issued.
It would be naive to believe that all institutions will use the Ripple as their main network for financial transactions. But, let’s consider the most optimistic scenario, and assume that by 2023, 5% of financial transfers will be performed via this network. This means Ripple project’s capitalization will reach 650 billion dollars. With a few simple calculations, we can determine the estimated value of a coin: $650 000 000 000/100 000 000 000 XRP = $6,5 for XRP
This calculation is approximate because we don’t know the exact amount that will circulate in the network and the amount of ripple coins has been rounded up to make the calculations more clear.
If we assume that the network will develop in a linear trend and will not be subject to any large unpredictable moves, then every year the Ripple coin will add about 1-1.3 dollars to its present value – $ 0.5 Based on this, according to the most optimistic predictions, the cost of one XRP coin can reach $ 2 per share. If this scenario proves correct, Ripple will soon become the most capitalized cryptocurrency network in the world.
Dash – as fast as its name.
Dash showed a stunning growth in 2017, like other coins from the top 15 by capitalization. In addition to the main impulse in November-December (which was common for all cryptocurrencies), it is worth mentioning separately that Dash had its moment of glory after its presentation by developers in late summer. And Dash did have something to boast about: an incredible transaction speed, low commissions, a serious level of anonymity compared to bitcoin and litecoin and reduced energy consumption for mining.
What is the reason for Dash’s substantial growth in 2017? First, the cryptocurrency managed to attract much attention. Second, the developers had been working on the improvement of their project by the sweat of their brow. So we witnessed the creation of DashCore and DashPay. Even Apple considered Dash reliable enough to add it to its App Store.
In terms of performance, this year should be even more prominent. Let’s figure out why. The main factor, that contributed to Dash’s growth was the active participation of the so called Masternodes in the development of the entire platform. But, what are Masternodes?
They are the people (i.e their wallets) who vote and make decisions on budget funding, locking transactions, mixing of coins – thus controlling the development of the entire platform. Literally anyone can become such representative. It’s enough to hold a thousand Dash coins collateral. The remuneration that was obtained from the generation of the block is divided among three parties. The first 45% goes to the miners, the second 45% is allocated to the nodes, and the last 10% is set aside as a reserve.
The masternodes decide how to spend the reserved coins by voting. Some offer their development concepts. Those who wish to offer their development concepts. If the idea of a certain node was adopted by the majority, then all the funds from the reserve are invested in the realization of his project. Such framework has proven to be extremely efficient. It is very fast and is implemented with no delays, almost in real time.
Dash is currently trading at the same levels as at the beginning of last winter, before the major crypto rally began. Taking into account this factor and all the advantages listed above, we can safely say that Dash has excellent prospects register decent growth both in the coming months and in the long-term.
Feel free to experiment with different altcoins, buy and sell them. Remember, that even the bearish market can give a lot of opportunities to earn by going short while others are just waiting for next crypto rally.