Is cryptocurrency investment in 2024 worth the risk?

Get answers to your crypto investment questions. Learn about trends, promising coins, market risks, and whether investing in cryptocurrency is wise in 2024.

Despite a buoyant surge in Dec. 2023, leading to an over 16% increase in the total crypto market cap to reach $1.66 trillion as of Feb. 6, we still find ourselves in the shadow of the highs of 2021.

Amid this, 2024 started off with good news, Bitcoin (BTC), finally received a nod with the SEC’s approval of spot Bitcoin ETFs, hinting at an institutional embrace that could funnel fresh capital into the market. 

The anticipation of Bitcoin’s halving in April teases a possible supply shock, fueling speculations that could redefine market dynamics​​. 

Meanwhile, an upcoming update is expected to reduce Ethereum’s (ETH) gas fees. It is predicted that this could result in average transaction fees dropping to less than $0.01, enhancing Ethereum’s competitiveness and attractiveness for users.

There also are predictions of crypto becoming the native currency of the internet as AI assistants adopt it for transactions, painting a picture of a sector on the brink of mainstream adoption​​.

Yet, as we stand at this juncture, the question that looms large is: is crypto still a good investment in 2024? Let’s find out.

Is crypto worth investing in 2024?

Exploring the question of is crypto still a good investment in 2024, let’s uncover several key trends and factors that could influence the crypto market this year:

Bitcoin halving and ETFs

The Bitcoin halving event scheduled for April 2024 is set to reduce the mining reward from 6.25 BTC to 3.125 BTC per block. Historically, halving events have led to significant price increases. For instance, following the 2020 halving, Bitcoin’s price surged to record highs in 2021.

Coupled with the approval of U.S. spot Bitcoin ETFs, these factors could significantly impact Bitcoin’s value, whether it results in bullish outcomes or bearish, remains to be seen​​​​​​.

Stablecoins and digital payments

Stablecoins are predicted to surpass the transaction volumes of Visa. Such a development could boost the utility and value of stablecoins, making them an attractive component of the crypto investment landscape. 

Prediction #4: More money will settle using stablecoins than using Visa.

Stablecoins are one of crypto’s “killer apps,” growing from effectively zero to a $137 billion market in the past four years, and we think 2024 will be another major year of growth. pic.twitter.com/uGjRxZjsyt

— Ryan Rasmussen (@RasterlyRock) December 13, 2023

Meanwhile, the adoption of stablecoins for daily transactions can increase their growing acceptance and make them a cornerstone in the future of digital payments​.

Ethereum, layer 2 networks, and TVL

Ethereum’s ongoing development, particularly with upgrades like EIP-4884’s Proto-danksharding, could improve scalability and reduce transaction fees, with Ethereum predicted to double its revenue to $5 billion in 2024. 

Meanwhile, layer 2 solutions like Polygon (MATIC) and Arbitrum (ARB), which aim to address the scalability issues of Ethereum, could also gain traction as Ethereum becomes mainstream. 

Amid this, the overall total value locked (TVL) data suggests a rebounding ecosystem from under $70 billion in Mar. 2023 to nearly $106 billion as of Feb. 6, according to CoinMarketCap. 

Corporate adoption and defi integration

The increasing involvement of corporate entities in the crypto space signals its growing mainstream acceptance. 

Moreover, the move to integrate know-your-customer (KYC) protocols within defi platforms could attract institutional liquidity, potentially making the defi sector more attractive to traditional investors. 

Social innovations

The growth of SocialFi, blending defi and social media, and integrating crypto in gaming and virtual worlds could broaden crypto’s potential to penetrate various sectors. 

These innovations could expand the use cases of crypto assets and open up new avenues for investment, particularly as platforms similar to friend.tech attract mainstream attention, marking the beginning and monetization potential of SocialFi applications​.

What is the best crypto to invest in right now?

Focusing on the recent growth and potential, let’s see which coins are trending and where they might be headed, bearing in mind the volatility and risks inherent in the crypto market.

Pendle (PENDLE)

Pendle has seen a significant uptrend, trading at around $3.20 as of Feb. 6, with a reported 140% growth over the last 30 days, attributed to its unique position in the defi space. 

Pendle allows for tokenizing and trading yield-bearing assets, enabling users to manage yields more flexibly. This, coupled with strategic investments and partnerships, such as the one from Binance Labs in 2023, suggests a budding ecosystem. 

The protocol’s multi-chain expansion and focus on both retail and institutional users could further boost its ecosystem’s value and PENDLE’s price. However, like any asset, it faces its share of market volatility and risks, especially in the short term​​​​.

Sui (SUI)

Sui (SUI) has seen a growth of over 80% in the last month, trading at $1.54 as of Feb. 6. 

Sui is a blockchain platform designed for high throughput and low latency, supporting various decentralized applications (dapps). 

Its rising popularity could be attributed to its technical capabilities, including scalability and developer-friendly features. 

Investors might be optimistic about Sui’s potential to capture a significant portion of the dapp market, which has been on an uptick lately, though the usual cautions about new blockchain platforms apply, including adoption challenges and competition.

Ethereum Name Service (ENS)

ENS has also experienced substantial growth, over 70% in the last month, trading at $22.15 as of Feb. 6. 

ENS’s price has jumped over 20% in the last 24 hours amid its partnership with GoDaddy, making it simpler for users to link their web2 domain names with a .eth domain without extra costs. 

ENS functions as a decentralized, open, and extensible naming system on the Ethereum blockchain, translating human-readable Ethereum addresses into machine-readable alphanumeric codes. 

This system mirrors the Internet’s DNS by making Ethereum addresses more user-friendly and accessible, similar to how DNS simplifies website accessibility for users​

Should I invest in crypto?

While above mentioned coins show promising trends based on innovative utilities and growing ecosystems, investing in cryptocurrencies remains highly speculative. 

Prices can be volatile, and you should be prepared for the possibility of losing your entire investment. 

Diversification and thorough research are crucial, and considering professional financial advice is always a good strategy before making any investment decisions.

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