Three More Sensible Ways to Play Crypto Mania…
Shiba Inu (SHIB USD) is one of the strangest cryptocurrencies in the world. The ether (ETH-USD)-based token started as a parody of another joke coin, Dogecoin (DOGE-USD). While Dogecoin had about 100 billion coins in circulation… Shiba Inu issued 1 quadrillion. Dogecoin had a secure validation method; Shiba Inu’s founders did their utmost to make it ridiculously unsafe by giving majority voting power to a single person, Ethereum founder Vitalik Buterin. (Buterin later revoked this ability.)
But the strangest thing is that Shiba Inu would eventually overtake Dogecoin in market value. In October 2021, the emerging token reached a peak value of $52 billion, nearly doubling Dogecoin’s value of $29 billion. For a brief moment, this new Beanie Babies-style trend was worth ten times more than the combined value of similar companies US steel (NYSE:X) or Cushman & Wakefield (NYSE:CWK).
The end of the 2021 meme coin bubble came just as quickly. By 2022, the $10,000 invested in SHIB would have been worth only $1,200. Billions of dollars in value would simply disappear, transferred from the pockets of one speculator to another.
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The tail wags the doge
Nonetheless, these joke coins have brought good luck to the native cryptocurrencies in which they operate. These “parent” cryptos don’t care if Shiba Inu is the next big thing… or if it’s Sandbox (SAND USD)… World coin (WLD-USD)… or JasmyCoin (JASMY USD). As long as the meme coin is in their system, all transaction revenue (gas fees) and reserve currency transactions flow in their direction.
As investorPlace crypto expert Charlie Shrem points out in his post latest presentation, it is these underlying cryptocurrencies that are performing even better than Bitcoin. One of them rose as much as 5,466% during the last Bitcoin-fueled crypto boom.
And that brings us to today, where a new surge in meme coins is taking place. Since the end of February, Shiba Inu prices have increased by up to 400% due to renewed speculative interest. On Monday, InvestorPlace.com’s summary of the rise of the Shiba Inu briefly became the most-read article on our entire site. It’s a level of mania we haven’t seen since the heady days of 2021.
This creates new potential for the most risk-taking investors. As Charlie says during his final presentation, this The new crypto bull market could soon turn into a mania. And if history repeats itself, our writers at InvestorPlace.com believe these underlying cryptocurrencies will be the ones to benefit…
Ethereum (ETH-USD)
Source: Shutterstock
Since I wrote about it here last week, Ethereum prices have already risen by 12%. The 10-year-old cryptocurrency is the second most valuable cryptocurrency in the world after Bitcoin (BTC USD) and its tokens run everything from Shiba Inu to 80% of NFTs traded.
In other words, each Shiba Inu coin is actually a fungible token on the Ethereum blockchain.
Other Ethereum-based meme tokens are also becoming increasingly popular. JasmyCoin, another meme coin with huge retail interest, saw a 400% increase in value over the last month. Traded volumes have increased from around $30 million per day to well over $500 million. Pepe (PEPE-USD) saw a similar increase.
This has led to a new spike in Ethereum “gas” prices, the cost of transacting any token on the Ethereum blockchain. On March 5, prices reached a high of $98, up from $17.38 at the start of the year. And given the close connection between rising gas prices and the underlying price of Ethereum, there is a good chance that the world’s second-largest cryptocurrency will continue to rise in the short term.
David Moadel also points out this week on InvestorPlace.com that Bitcoin’s April 19 halving could also push Ethereum prices to $5,000 this year.
Previous halving events have been accompanied by rallies in Bitcoin. Therefore, April could be an epic month for Bitcoin, but don’t forget about Ethereum.
[That’s because] It also makes sense to hold some Ethereum, which is likely to make an even bigger move than Bitcoin. In fact, it is entirely possible that ETH-USD will break $5,000 at some point this year.
Alex Sirois sees even better potential in the long term. In a recent InvestorPlace.com article, he writes that Ethereum will have a fivefold upside potential by 2025 due to its dominance in the digital world:
On the one hand, Ethereum continues to underpin the entire cryptocurrency space through its dominance in DApps [i.e., decentralized applications] and smart contracts. It is an integral part of the entire crypto environment. Additionally, Ethereum will soon be available through spot ETFs similar to those recently approved through Bitcoin.
In both cases, Ethereum has long been the “safest” cryptocurrency you can buy alongside Bitcoin. And as meme mania increases, Ethereum stands to benefit significantly.
Solana (SOL-USD)
Source: Solvertv / Shutterstock.com
Prices from Solana (SOL USD) have performed even better since the update last week. Values are up 18% and the “fourth generation” cryptocurrency has attracted a lot of new money.
The most notable of these is Dog woman (WIF-USD), a new puppy-themed cryptocurrency whose website simply describes itself as “literally just a dog in a hat.” In the last two weeks, speculators have increased its value to $2 billion. Over $1.4 billion was traded on March 6 alone. William White documents this bizarre coin in an update to InvestorPlace.com this week. Other misspelled meme coins on Solana – like Jeo Boden, Olen Mosk and Solama – have also risen for no clear reason. Based on market capitalization, they are worth tens of millions of dollars.
Nevertheless, there are more sensible bets in the Solana ecosystem, for example based on AI Make (RNDR USD) and indexing protocol The Graph (GRT-USD). These better-established tokens generate more consistent on-chain activity, leading InvestorPlace.com writer Chris MacDonald to call Solana an even better choice than Ethereum.
The [Solana] The network has become synonymous with the NFT space as many transactions occur for smaller dollar amounts. Ethereum’s network, which can charge high gas fees to use, is not well suited for such purposes. Therefore, Solana was able to generate real-world benefits.
While Ethereum relies more on gradual upgrades, Solana is known for innovative solutions such as the Saga phone and successful crypto strategies. These high-growth strategies make this token more attractive to those looking for outsized gains, at least during this bull rally.
For risk-averse investors looking to profit from the unpredictable rise of memecoins, Solana is another solid bet.
NEAR Protocol (NEAR-USD)
Source: Shutterstock.com/FellowNeko
Finally, Faisal Humayun writes on InvestorPlace.com this week that crypto exchanges will do well as trading activity increases. He chooses Coinbase (NASDAQ:COIN) And Binance (BNB-USD) as two top winners.
Meanwhile, Muslim Farooque finds even more potential in NEAR protocol (NEAR USD), an ecosystem that includes names like Chainlink, The Graph, Maker and Siacoin. The system builds on previous attempts to expand Layer 1 blockchain networks and has become a dominant player in the space.
The NEAR Protocol redefines the digital landscape as a decentralized supercomputer and effectively addresses typical blockchain challenges with a user-centered design. NEAR’s approach to account aggregation simplifies the blockchain experience by allowing a single account to be managed across multiple networks, streamlining user interactions.
While all three will thrive if crypto prices continue to rise, NEAR has the advantage of being decentralized at a time when the US Securities and Exchange Commission (SEC) is cracking down on the centralized type. There are several lawsuits against Coinbase, which is why some Wall Street analysts describe the company as “uninvestable.” Binance CEO Changpeng “CZ” Zhao is being personally sued by American regulators.
On the other hand, the SEC has only managed to reference the NEAR Protocol in lawsuits without targeting the cryptocurrency itself. NEAR merely acts as a platform to help developers create crypto-related tools. And given NEAR’s recent price surge, don’t be surprised if speculative interest in the system continues as well… at least for now.
The largest casino in the world
Other than the occasional flutter, I rarely recommend meme coins. The only money that flows into cryptocurrencies has to come from other investors, so the entire industry is a negative-sum game when you take out the “cutting out” that miners and exchange owners do. Play the game long enough without strategy and you’ll end up with less than you started with.
Of course, some tokens will be successful. There are over 500,000 of them on the Ethereum blockchain alone, and it’s almost certain that some winners will emerge. If you have a system that can detect speculative interest before the crowd jumps in, then you will almost certainly make money. Meme Coin Casino does not have a card tip ejection mechanism.
Meanwhile, those with longer-term views can often benefit from identifying broad trends in investor sentiment. Speculators who bought Bitcoin in 2016 would have made a 2,000% return within two years. Lucky Shiba Inu speculators recorded even bigger profits in 2021.
In fact, crypto pioneer Charlie Shrem says a massive collapse in the crypto industry has begun… one that he says could drive Bitcoin to $1 million. History shows that smaller altcoins could rise as much as 134x, 646x, or more.
Click here to watch Charlie’s latest presentation and find out which five coins he thinks you should buy now.
At the time of publication, Thomas Yeung had no positions in any of the stocks mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publication policies.