As we head into a new year, 2023 is set to be the best time to look for cryptos to buy. The turbulence last year due to rate hikes and the selloff of cyclical assets such as cryptos might make it look all doom and gloom. But the bottom has historically been the best time to buy.
Of course, it is difficult to predict the actual bottom, but many projects now sit well below pre-pandemic prices, with little downside risk. Moreover, Bitcoin (BTC-USD) will halve its mining rewards sometime in Q1 2024. As most cryptos correlate with BTC, this halving will likely start another crypto bull run next year, continuing the historical trend.
Therefore, let’s’ dive into the following seven cryptos to buy, as they can benefit heavily from Bitcoin’s halving. I highly recommend doing your own research into these tokens, as many of them are small-cap projects.
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Unsurprisingly, Bitcoin will be the biggest beneficiary of the halving. The standard deviation of BTC is lower than almost every other cryptocurrency, excluding stablecoins. Thus, if you are looking for the safest cryptos to buy, Bitcoin should always be your go-to project due to its evergreen status.
I’d even say it is the only crypto project worth dollar-cost averaging into, as positive returns are very likely if you choose to hold for many years. It is a tried and tested asset with a solid reputation and won’t disappoint in the long run. I cannot say the same for any other asset in this article.
In the current environment, BTC is by far your best bet. There are no guarantees that the crypto market is at a bottom, and Standard Chartered analysts forecast Bitcoin could go as low as $5,000 this year. The scarier part of this scenario is that more cyclical altcoins will be hit much harder.
Conversely, the economy remains healthy, with the recent jobs report indicating a robust labor market. If the Fed does a U-turn in late 2023 or early 2024 and the Bitcoin halving occurs within the expected time, BTC is likely to surge. Thus, it remains the best among the cryptos to buy.
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Ethereum (ETH-USD) is the second-largest cryptocurrency by market cap and should be your second option if you are looking for safer cryptos to buy. Although ETH is more volatile than BTC, it is an established project that has survived multiple crypto market cycles and outperformed Bitcoin of late.
The project is at the forefront of Web3 and blockchain development, leading the development of smart contract-based applications such as non-fungible tokens. A significant number of NFTs and Web3 projects are also being developed on the Ethereum blockchain. However, the most considerable advantage of Ethereum is that thousands of crypto projects rely on the blockchain and need ETH for gas fees. There are 744,000 ERC20 tokens on the network, generating significant demand for Ethereum.
Furthermore, the network’s switch to a proof-of-stake (PoS) consensus reduced ETH issuance by 88%. In the next crypto market rally, increased ETH demand and reduced issuance will likely make Ethereum trade at a much higher valuation.
Sticking with Bitcoin and Ethereum will give you a balanced risk-reward ratio. Thus, I recommend you venture into other cryptos only if you seek outsized returns with little regard for risk.
Much like Bitcoin, Litecoin (LTC-USD) is a proof-of-work (PoW) blockchain that undergoes a halving event. The next halving event for Litecoin will occur in August this year and cut mining rewards to 6.25 LTC from 12.5. That should significantly increase the value of this cryptocurrency, as it is among the most popular blockchains for miners after Ethereum shifted to a PoS consensus.
Furthermore, while many thought of Litecoin as an old and irrelevant project, its recent MimbleWimble upgrade added much-needed utility and is bringing it back to relevancy. Litecoin users can now transact with the same degree of anonymity that many privacy coins such as Monero (XMR-USD) promise, but with Litecoin’s block time of just 2.5 minutes.
I believe LTC is at compelling levels and is bottoming out. It has gained 61%-plus from its trough last year, and I expect these gains to accelerate as it gets closer to halving. Next year, Bitcoin’s halving will be the icing on the cake for this project.
I’ve discussed Filecoin (FIL-USD) a considerable amount of times in my recent articles, and Storj (STORJ-USD) is similar to that project. The main difference between the two is that Storj maintains a central authority, while Filecoin is peer-to-peer. I believe both will be significant beneficiaries of the burgeoning cloud computing and storage industry, especially once decentralized storage becomes more mainstream.
Blockchain storage is also cheaper than centralized counterparts that run data servers and has no censorship. On top of that, since the blockchain isn’t a single server, the uptime and resiliency of these cloud storage platforms are remarkably high. These factors combined will make blockchain cloud storage projects highly-compelling to end users in the long-run.
Of course, I only recommend small caps like Storj if your risk profile is aggressive. Sticking with more established projects such as Filecoin is a much better idea for long-term investing.
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Terareum (TERA-USD) is a centralized crypto exchange, and TERA is the native token of the project. Although the token has taken a hit from the selloff last year due to its small market capitalization and the effects of the current crypto winter affecting all altcoins in addition to Bitcoin and Ethereum, Terareum is highly likely to deliver disproportionately high returns due to its leading utility that has successfully launched on December last year. The Terareum exchange, also known as “TERAREUM,” offers lots of features under one roof, including debit cards, spot trading, and utilities such as Margin, Futures, and Staking capabilities. I recommend further researching the project on its website due to its complexity.
In addition, Terareum also has a cryptocurrency launchpad called Terapool. The launchpad raises liquidity for other crypto projects with much lower interest rates. Thus, the demand for this token will likely increase in the next cycle, due to new crypto projects and higher user influx into the Terareum exchange. The release in Quarter 3 of 2023 of an indigenous Layer 1 – Terareum Blockchain based on the PoS concept could also compel large institutional investors.
Finally, there’s also Terapay which enables users to utilize fiat and crypto transactions as a mode of payment for goods using a single platform at many vendors and merchants for online costs. The payment gateway is adopted worldwide and could become a game-changer in the cryptocurrency & Web3 space.
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Kalima (KLX-USD) piqued my interest because of the functionality the project aims to provide. On its website, it states that Kalima is a Layer 1 blockchain for enterprises and IoT (Internet of Things). This is a network of blockchains offering quick transactions and limitless scalability.
Kalima’s full client nodes can be embedded not only on small IoT devices but also on supercomputers. This includes mobile and web clients, allowing for transactions to be managed with a latency of less than one second. Kalima smart contracts can also be executed on the client side, opening a new world of edge-computing and blockchain technology possibilities.
Its token, KLX, secures the whole Kalima network, enabling the payment of transaction fees, staking, data governance, the acquisition of nodes for PrivaChains, and numerous essential other Kalima Network key functionalities. The Kalima Blockchain allows developers to have complete control of their dApps using standard languages and tools, their governance and business models. Project developers have implemented these features successfully, and I anticipate significant growth for its KLX token.
Finally, Enedis (OTCMKTS:ECIFY), ArcelorMittal (NYSE:MT), Tenneco, and Spie are using Kalima’s technology. That’s quite a big plus when it comes to crypto, as only a few projects offer real-world utility. KLX will be listed on the 2nd of February on Bitmart.
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Loopring (LRC-USD) is among the most cyclical cryptos to buy. The primary purpose of this project is to supplement the Ethereum blockchain’s scalability through zkRollups. Of course, this means that the project’s objective becomes redundant when the Ethereum blockchain receives less traffic. Likewise, the opposite is true when the Ethereum network is congested during a crypto bull cycle.
Therefore, buying LRC at the trough before Bitcoin’s halving is an excellent idea. When the Ethereum blockchain becomes congested again, Loopring will offer disproportionately higher returns than the rest of the market.
On Low-Capitalization and Low-Volume Cryptocurrencies: InvestorPlace does not regularly publish commentary about cryptocurrencies that have a market capitalization of less than $100 million or trade with a volume less than $100,000 each day. That’s because these “penny cryptos” are frequently the playground for scam artists and market manipulators. When we do publish commentary on low-volume crypto that may be affected by our commentary, we ask that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
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On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Omor Ibne Ehsan is a writer at InvestorPlace. He is also an active contributor to a variety of finance and crypto-related websites. He has a strong background in economics and finance and is a self taught investor. You can follow him on LinkedIn.