Alejandro Arrieche
Cryptocurrencies have experienced a major downturn so far this year as changing macroeconomic conditions, war drums, and the collapse of Terra’s UST stablecoin have undermined investors’ confidence in digital assets.
However, this is not the first time that cryptocurrencies are on a downtrend as the market has proven to be cyclical as adoption continues to rise and investors keep embracing these instruments as financial assets to be incorporated into traditional investment portfolios.
If you are looking to get exposure to the crypto market at a moment when things seem a bit chaotic, the following article summarizes the 5 best cryptocurrencies based on their low risk-to-return ratio.
These digital assets offer the most upside potential compared to the risk assumed by the investor when holding them.
#1 – Bitcoin (BTC)
The launch of Bitcoin marked the genesis of the cryptocurrency market and, despite much criticism and controversial opinions about its underlying technology and tokenomics, this digital asset has withstood the passage of time and has managed to deliver eye-popping gains to those who have held on to it through thick and thin.
Right now, Bitcoin (BTC) is trading near the $30,000 level – a crucial area of support that the token has used as a launching pad in two previous instances to then rally at least 100% in subsequent months.
Could history repeat for BTC this time? The odds are favoring a positive outcome. As the saying goes, history doesn’t repeat but it usually rhymes.
One of Bitcoin’s strongest assets is its huge community of early adopters who believe in the power of the blockchain and in BTC’s ability to become a world-class mean of payment and store of value.
Cryptoassets are a highly volatile unregulated investment product. No UK or EU investor protection.
#2 – Lucky Block (LBLOCK)
Lucky Block is a decentralized gaming project that seeks to revolutionize the entire industry by promoting transparency and encouraging long-term HODLing.
Some of the features that make Lucky Block (LBLOCK) unique include the fact that token holders are compensated in many different ways. First, they always earn money when the jackpot is distributed as 10% of it goes to investors directly.
Moreover, as more gamblers are attracted to participate, the value of the token may rise as its maximum supply is set at 100 billion.
The project’s jackpot is funded by the collection of a 12% tax imposed on short-term trading transactions. Aside from funding this initiative, the tax also encourages token holders to buy and hold. This ultimately has a positive influence on the price as liquidity and supply remain limited.
Cryptoassets are a highly volatile unregulated investment product.
#3 – Ethereum (ETH)
The popular smart contracts network built by Vitalik Buterin has managed to attract thousands of developers from across the world due to its easy-going coding language and the resilience of the blockchain to withstand 51% attacks due to its fragmented ownership structure.
According to State of the DApps, a website that tracks the number of applications developed by using different blockchains, developers have thus far created a total of 2,962 apps by using the Ethereum Virtual Machine (EVM).
For reference, only 62 dApps were active back in May 2017 meaning that the number of programs that are now powered by this blockchain has grown at a compounded annual growth rate of 117% in the past 5 years.
Cryptoassets are a highly volatile unregulated investment product. No UK or EU investor protection.
#4 – BNB Chain (BNB)
The Binance Smart Chain was recently renamed BNB Chain, one of the world’s largest crypto exchanges and the company that developed this multi-faceted blockchain. This move comes as part of a strategy to get rid of criticism concerning the centralization of the solution as it was developed by a centralized exchange.
The BNB Chain supports the creation of digital assets – known as BEP-20 and BEP-721 tokens – while developers can also build decentralized applications (dApps) by using this layer-one blockchain.
The practical use of the network’s native token BNB, used to pay all transaction fees generated by the network, makes it a sound asset as it supports an income-generating initiative whose adoption has been increasing over time.
According to State of the DApps, the number of applications now powered by the BNB Chain has grown from around 13 in September last year to nearly 250 as of now. In addition, the BNB Ecosystem has created a $1 billion fund to support initiatives that are powered by its blockchain.
Cryptoassets are a highly volatile unregulated investment product. No UK or EU investor protection.
#5 – FTX Token (FTT)
FTX has progressively become one of the most valuable crypto derivatives exchanges in the world. In the latest funding round, the company founded by Sam Bankman-Fried was valued at $32 billion and recently launched its services in the United States at the same time it is pursuing an acquisition that allows it to offer stock trading services in the North American country.
The FTX token can be bought by the company’s registered users to reduce trading fees and as collateral to open trading positions when dealing with futures and options.
The token can also be staked to earn interest and token holders may also enjoy periodical airdrops of non-fungible tokens and other similar giveaways.
Cryptoassets are a highly volatile unregulated investment product. No UK or EU investor protection.
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This article was written for Business 2 Community by Alejandro Arrieche.
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