The cryptocurrency market is one that’s proven to be volatile. In recent years, much of this volatility has been to the upside. As a result, retail investors have been exploring different cryptos to buy on the dip for outsized returns.
That said, this year’s bear market has transformed this sentiment quite considerably. Investors have primarily attempted to de-risk their portfolios, choosing safe havens over hypergrowth assets. Thus, more investors are looking to sell cryptocurrencies nowadays.
Of course, macroeconomic factors such as rising rates combined with regulatory and geopolitical concerns don’t help. However, from a sector-specific standpoint, the collapse of various crypto lenders, stablecoins, and other structural issues have come to the fore.
That said, for those looking to take a long-term view of the crypto sector, there are options to consider. Here are the three top cryptos to buy on the dip:
Cryptos to Buy: Ethereum (ETH)
Ethereum‘s (ETH-USD) unexpected decline this year has been notable, as has this token’s volatility. Since hitting a high of around $4,900 per token roughly a year ago, Ethereum’s price recently dropped as low as $900. However, with ETH now trading at about $1,300 a token, long-term investors may get excited about this token’s prospects, given its improved risk-reward at these levels.
One of the biggest reasons for optimism among long-term investors is Ethereum’s recent upgrade called “the Merge.” This upgrade essentially rolled the network’s proof-of-stake Beacon chain into the mainnet, creating a much more energy-efficient network. That’s great news for those with concerns about the environmental impact of this project. Moreover, this upgrade bodes well from a long-term perspective concerning future upgrades that may take place.
In addition, founder Vitalik Buterin has stated multiple times that this Merge lays the groundwork for many efficiency upgrades which could improve the speed and cost profile of Ethereum. For those who have used this network, that’s a big deal. Indeed, one of the significant concerns among many investors in ETH is the pending competition from other proof-of-stake networks.
Over time, I think Ethereum will likely maintain its second spot in the crypto rankings. Some believe a “flippening,” or Ethereum taking over the top spot is also possible. In any case, Ethereum certainly looks like a much more solid long-term bet with its current prices.
Like Ethereum, Solana (SOL-USD) was purpose-built as a building block of decentralized finance. This network is among the main Ethereum competitors, noted for its speed and scalability.
Notably, Solana can process thousands of transactions per second. This speed advantage has led to significant developer interest in the Solana network. With more developers coming to decentralized applications, Solana’s ecosystem has expanded considerably.
Currently, it’s estimated that Solana’s market share in the NFT space, in particular, is around 1.1%. This is impressive, considering the network’s market share in early 2021 was only 0.01%. That kind of exponential growth is what long-term investors want to see.
Moreover, Solana has seen incredible daily transaction growth through Q2. Over 40 million daily transactions took place on the Solana network, compared to 1 million daily transactions for Ethereum between April and June. Thus, the Solana blockchain is often seen as more utilitarian instead of an investment vehicle.
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Cardano (ADA-USD) is a proof-of-stake blockchain typically considered an Ethereum competitor. The project is among the oldest to have adopted a pure proof-of-stake model. Accordingly, this project’s developers, users, and investors are among the most stable in the sector.
Cardano’s founder Charles Hoskinson is among the leading minds in the crypto world. Many attribute some of the great successes of this blockchain to its core team. Indeed, I think that’s a great selling point worth considering.
However, this network also has several other advantages worth considering. The network’s recent Vasil hard fork, a significant upgrade similar to Ethereum’s Merge, has been implemented very recently. This upgrade will improve the network’s efficiency and scalability. Therefore, for those looking for another blockchain with excitement from an upgrade, Cardano certainly has some momentum potential from here.
In addition, I think this token is an intriguing investment over the long term. Like all tokens, it’s been hit hard. But from a risk-reward perspective, ADA is starting to look much more attractive.
On the date of publication, Chris MacDonald has positions in Ethereum and Solana. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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