Investors have found replacement for bitcoin for super profits
2023.03.07 04:48
Investors have found replacement for bitcoin for super profits
By Tiffany Smith
Budrigannews.com – Bitcoin is beginning to look a little out of date to investors who live on the digital edge.
Some people are abandoning the original cryptocurrency, which was designed as an alternative to regular cash, in favor of its descendants, which are native tokens of blockchain platforms that host smart contracts and apps. They are hooked on the high growth of the cryptocurrency.
MarketVector’s Smart Contract Leaders Index, which tracks important tokens of this kind like ether, dot, and solana, will rise by 36% in 2023, more than bitcoin’s 33% rise. This year, the token is up 76%.
The CEO of Fineqia, a crypto-focused asset manager, Bundeep Rangar predicted that smart contract tokens on platforms that support decentralized finance (DeFi) apps would generate the greatest crypto returns.
He continued, “Those are ones that you will find capital appreciation, similar to what will be a growth stock.”
According to CoinShares data, investment products tracking ether and solana have seen small inflows despite bitcoin products experiencing four consecutive weeks of outflows. This suggests that some investors in the $1 trillion digital asset market agree.
Ether, dot, solana, and cardano are among the seven smart contract tokens that make up the top 20 largest crypto assets.
Analysts at BofA also compared smart contract tokens and the blockchain-based applications they power to growth stocks, typically technology shares, in the equity market.
Analysts at Bank of America (NYSE:) predict that “we expect 2023 to be the year of token price divergence.” wrote in a research note on February 24.
BTC is still the king
has traded in tandem with tech stocks for a long time, but as smart-contract tokens increasingly take on the role of crypto super-growth, that connection may be breaking.
On February 23, the cryptocurrency’s 30-day correlation with the Nasdaq turned negative for the first time since the beginning of December. A correlation of one indicates that the two assets are moving in the same direction.
Despite the market turmoil of 2022, some crypto watchers believe that the relative strength of smart-contract tokens this year indicates a strong performance by the most established DeFi protocols. However, they warn that the growth of crypto projects and the tokens associated with them may be hindered by the global macroeconomic outlook and central bank policy.
CoinShares’ head of research, James Butterfill, cautioned that a significant divergence in cryptocurrency was also premature. Indeed, bitcoin’s share of the total crypto market capitalization has slightly increased to 40%, up from 38% at the beginning of the year.
Butterfill, on the other hand, suggested that such departures might be a sign that the cryptoverse was getting older.
“We should be increasingly adopting the view that price divergence will begin as the market evolves and becomes more sophisticated and mature.”
