Considering all the chaos that the crypto world has seen recently, one might be tempted to think that digital currencies are gone forever.
Remember, though, that there are always boom-and-bust cycles in every market. And many times – not always, of course, but often – those markets that have been being built upon consistently for some time bounce back. We believe this will be the case for crypto. There’s no denying that it’s been a rough year, but lessons are learned in times of hardship, and some currencies may come out even stronger than before.
Which coins to look for
Which ones will come back soonest, though? Will Bitcoin and Ethereum make a dramatic comeback, or will we see the sudden rise of something new? Let’s take a look at some of the early indicators as the year is getting started.
Bitcoin and Ethereum might have to wait a while
Bitcoin hit a recent low in November 2022 following the big FTX scandal. It started to rise again slightly in December, but only by about 1%. On the whole, the currency dropped about 65% last year, making it the second worst year ever for Bitcoin.
So, what to expect next year? Well, analysts speculate that there will be a relative recovery about mid-year. What this means in terms of numbers is that there could be a rise to as much as $50,000 (although many experts are not that optimistic) following a high of $65,000 just over a year ago. So it could be a reasonable recovery, or it could be mediocre. But a big rise back looks unlikely.
Ethereum hit a big peak at over $4000 in late 2021, and some analysts were predicting that it would go even higher by 2022. These expectations were dashed, however, when the currency dropped to the $1000 range by the end of last year amidst all the general crypto chaos.
Some analysts do predict a partial recovery for Ethereum in 2023, but not nearly to the levels that it hit in 2021. Optimistic estimates put it in the $2-3000 range by mid-year.
Expectations for an Ethereum recovery are higher in general than for Bitcoin because of the greater degree of flexibility that Ethereum has. Not only can it be mined on different blockchains, but it is compatible with non-fungible tokens that can be used for different purposes.
And how about lesser-known currencies?
Let’s not forget, cryptos are just like any other capitalistic phenomenon: once a couple of leaders get established and prove that they can succeed, everyone else will want to copy them. So we shouldn’t be tempted to think that the previous leaders are the only currencies to watch.
Experts predict a rise in several other lesser-known names, including:
Avalanche – Sounds like an ironic joke, right? Not necessarily. Avalanche is both compatible with the Ethereum network, and also capable of a much greater number of transactions per second. Considering its strong start, Avalanche is set to potentially make big gains in 2023.
IOTA – With another inauspicious sounding name, IOTA is also set to surprise. IOTA’s stand-out feature is that it works with the Internet of Things (IoT), which is also due to grow in many new and exciting directions in the near future. IOTA doesn’t use blockchain but rather its own unique basis, known as “Tangle” for its operations.
Algorand – Algorand boasts a unique compatibility with multiple different blockchain networks. That, in addition to super fast transaction speeds and a pure proof of stake consensus mechanism make it a strong prospect this year.
Store your money wisely, too
Other questions arise, such as where to store your currency? Buidlbee provides answers to this and similar questions in its ongoing series of articles on all crypto-related matters. Digital wallets, and the advantages and risks involved in storage are all addressed on its site.
There are no sure things, of course, and we may well see another crash again in the not-too-distant future. But life is all about risk taking and knowing when to get into and pull out of deals at the right times. If you take no risks, you’ll be sure to gain nothing. So keep educating yourself and try to sniff out the best opportunities where you can.