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2 cryptocurrencies down 70% and ready to explode
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In 2023, none of the major cryptocurrencies are in the red. In fact, quite the opposite. Many major cryptocurrencies recorded triple-digit percentages during the year. For example, Bitcoin (CRYPTO: BTC) is up more than 107%, while Solana (CRYPTO:SOL) is up more than 650%.
This is the good news. The bad news is that despite notable rallies this year, many major cryptocurrencies are still down 70% or more from all-time highs of just two years ago. Two affordable cryptocurrencies that particularly stand out right now are Avalanche (CRYPTO: AVAX) e Chain shirt (CRYPTO: LINK).
Avalanche
During the latest cryptocurrency bull market rally, Avalanche it rose to a high of $146. Given today’s price of just $40, that means Avalanche is trading more than 70% below its peak.
This seems like an excessive discount, given that Avalanche is one of its main competitors Ethereum (CRYPTO: ETH). In fact, Avalanche has been called an “Ethereum killer,” due to the fact that it is simply much faster and cheaper to use than Ethereum. Just like Ethereum, Avalanche offers everything you would expect from a Layer-1 blockchain, including non-fungible tokens (NFT), decentralized finance (DeFi), blockchain games and Web3 applications.
Image source: Getty Images.
The latest news around Avalanche concerns the launch of a new type of collectible cryptocurrency. In many ways, these collectibles are similar to the hugely popular Bitcoin Ordinals, which in turn are based on the concept of traditional NFTs. To give you an idea of how popular they are, 95% of all transactions on the Avalanche blockchain are now tied to these crypto collectibles. Depending on your view of NFTs, it’s exciting or terrifying.
Over the past 30 days, Avalanche is up more than 90%, potentially setting the stage for a strong start to 2024. From my perspective, one of the main reasons for Avalanche’s strong rally late in the year has to do with Solana’s recent outstanding performance. . Since Solana and Avalanche are very similar in what they do (both are direct rivals to Ethereum) and Solana has grown over 650% this year, many investors may now expect the same type of performance from Avalanche. This could lead to a large influx of money from investors next year.
Chain shirt
Chain shirt is another cryptocurrency that has soared during the latest cryptocurrency bull market rally. Chainlink ultimately reached a high of $53 in 2021. At the current price of $15, this means Chainlink is now trading at a discount of more than 70%.
Chainlink is unique in that it is a decentralized blockchain data oracle. Its main purpose is to provide data to smart contracts, which are small pieces of self-executing computer code. This might seem like a lot of cryptocurrency chatter, but what it really means in practical terms is that Chainlink is at the very center of how data is exchanged in the blockchain world. The most immediate application is in the world of decentralized financewhere smart contracts require constant access to real-time data.
The story continues
This explains why Chainlink’s value skyrocketed during the last boom. In the summer of 2020, DeFi was all the rage, and many people thought that decentralized finance would eventually take over traditional finance (the world of Wall Street and financial intermediaries). In many ways, Chainlink has benefited from all the buzz and hype around DeFi.
In 2023, Chainlink is back with another great idea and it involves artificial intelligence (AI). In May, Chainlink outlined all the ways integrating AI and blockchain would make a lot of sense. Some of the ideas, frankly, weren’t all that sexy. “Authenticity verification” is very important to blockchain users, but it’s also not the kind of thing you’d probably bring up at a party. But if Chainlink can come up with a really great idea – a sort of “killer app” for blockchain and artificial intelligence – then it could take off in the years to come.
How risky is 70%?
Keep in mind that both Avalanche and Chainlink are highly speculative investments in a highly volatile cryptocurrency market. We’ve already seen them soar once before collapsing. So the same thing could happen again. It is absolutely essential to do your due diligence on these two cryptocurrencies. If you believe the market is efficient, then there must be a very good reason why both are trading at such steep discounts.
That said, I’m the type of person who likes to rummage through the “final markdown” bins at stores, so I’m intrigued by the deep discounts on these cryptocurrencies. Heading into 2024, both look like cryptocurrencies that could explode.
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Domenico Basulto has positions in Bitcoin and Ethereum. The Motley Fool has positions and recommends Avalanche, Bitcoin, Chainlink, Ethereum and Solana. The Motley Fool has a disclosure policy.
2 cryptocurrencies down 70% and ready to explode was originally published by The Motley Fool