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Like the US stock market, the cryptocurrency market has been absolutely devastated during the first seven months of 2022. Although many cryptocurrencies have bounced off recent lows, even the largest cryptocurrencies, such as Bitcoin, remain to two-thirds or more of its historical value. high In times like these, it seems inevitable that many will continue to fall out of favor with investors. But amidst this doom, some long-term winners may emerge, perhaps even stronger than ever with the demise of some competitors. Although every cryptocurrency should be viewed as a speculative investment, here are three cryptocurrencies that show promise in August and could continue to recover.
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- Price from August 4: $1,634.65
Ethereum is one of the most functional cryptocurrencies out there and provides a very flexible platform on which developers can build decentralized applications. Its popularity has skyrocketed to the point that it is by far the second most valuable cryptocurrency, behind Bitcoin, with a market capitalization of $201.78 billion as of August 3. But the best may be yet to come with Ethereum. The crypto is in the process of being upgraded to Ethereum 2.0, which will see it move from the proof-of-work algorithms used by Bitcoin to a proof-of-stake platform. According to the developers of Ethereum, this will make the crypto “more scalable, more secure and more sustainable”. In other words, it should make everything investors love about Ethereum even better, which should theoretically attract more buyers to the crypto. Whether or not investors fully understand the ins and outs of Ethereum 2.0 could even be secondary to the fact that it should remain in the public eye while the media and financial pundits discuss the ongoing change. The crypto has rallied around 57% in the past month but is still around 66% below its all-time high.
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- Price from August 4: 90 cents
Polygon flies a bit under the radar in the crypto world, but it still has the 13th largest market capitalization of all cryptocurrencies, at $7.2 billion as of August 4. Ethereum fans are often also supporters of Polygon because the latest cryptocurrency was designed as a “layer two” solution to work directly with Ethereum. A “layer two” solution is designed to increase the speed and efficiency of blockchains, which is an important and highly desirable feature.
In the last month alone, Polygon has jumped over 90%, partly due to the general crypto market rebound, but also due to specific Polygon news. On July 20, Polygon announced the world’s first zero-knowledge scaling solution, dubbed zkEVM, which is specifically designed to greatly improve the experience of using and building with Ethereum. The new development will reduce transaction costs and improve the scalability of Ethereum, which is a move towards greater adoption of web3 technology. Investors may not fully understand the technical jargon of the latest Polygon news, but the bottom line is that Ethereum is one of the major players in the crypto/blockchain ecosystem, and Polygon is glued on its back, which makes it better, faster and stronger.
Speaking of web3 technology, Polygon also announced a global strategic partnership with web3 game development studio Epic League on August 4th. This is just the newest of over 19,000 decentralized services ranging from financing to gaming running on the Polygon platform. Meta, Stripe, and Adobe are just a few of the big tech names that are also working with Polygon on web3 development.
Despite the recent big rebound, the price of Polygon is still almost 70% below its all-time high, perhaps marking an entry point for risk-tolerant investors looking to get a cryptocurrency on sale.
Polka dots (DOT)
- Price from August 4: $8.09
Polkadot is another crypto that may not be a household word, but still has a market cap of $9 billion as of August 4, good enough to make it the 10th largest crypto. Polkadot supporters believe that their own version of a decentralized internet infrastructure is strong enough to eventually usurp Ethereum’s dominance. Polkadot operates using parachains, which allows it to be compatible with all external blockchains. It’s also fast. Polkadot has a goal of being able to process 1 million transactions per second, far more than Ethereum’s rate of about 15 transactions per second. Since speed and compatibility are two of the drawbacks that Ethereum and crypto platforms in general are loaded with, Polkadot could provide the solutions.
If you’re the type of investor who believes in the power of “smart money,” Polkadot may also appeal to you. After industry giants Bitcoin and Ethereum, Polkadot was the most widely used cryptocurrency by venture capitalists and hedge funds in Q4 2021. Considering Polkadot’s first launch was only in May 2020, this shows support is awesome. Institutional backing doesn’t guarantee a winning investment, of course, but it does show that some of the smartest minds in finance think Polkadot is worth a look.
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