Large Quantities of Dollar Printing by US FED may depreciate the value of the Dollar
Image by 3D Animation Production Company from Pixabay
Of late, it’s common knowledge that the United States’s Fed has printed unlimited amounts of money to keep the market in the economy afloat. There have been talks of the need for the common man to hedge against the Dollar, as the currency can lose value, depreciating due to the effects of resulting dollar currency inflation, making the currency worthless. The deficit of the US is currently at 19.2% this time which is bigger than it ever was in history. Yup even during the time of the Great Depression and World War 2, the deficit did not reach these ranges!!
There is Bitcoin to Hedge but other promising cryptos too exist
With this being the situation, many are bullish on Bitcoin, as it’s a digital currency whose supply cannot be manipulated by the Government. It is expected that Bitcoin would be an asset that would act as a hedge against the inflation affected Dollar, along with traditional safe haven assets like Gold and silver. However, beyond Bitcoin there are other cryptos that would appreciate in value too and an investor should consider investing in these projects that are already beating Bitcoin in price action.
Tokens of promising Defi projects are beating Bitcoin in Price
Image taken from this newsbrc article>>
Bitcoin’s major use case that makes it valuable now, is its store of value utility, this is why it can act as a hedge against Dollar and other National fiat currencies which have a possibility of losing value. However, there have been so many blockchain projects with real world use cases, so the price of these cryptos could appreciate and rise more than the percentage increase in price of Bitcoin. Already there are coins that are outperforming Bitcoin, and most of these coins are of DEFI projects.
Below are price action screen shots of 3 DEFI projects - Aave, 0x and Kyber Network against Bitcoin.
KNC (Kyber Network) price action against BTC (Bitcoin)
Price has risen by 157%
Aave price action against BTC (Bitcoin)
Price has risen by 4921%
ZRX(0x) price action against BTC (Bitcoin)
Price has risen by 4921%
Decentralised Finance Projects, seems to be the area of upcoming growing interest and popular projects in the space should appreciate in price value exponentially.
Creating a Crypto investment Portfolio after your Bitcoin investment
Today, Blockchain Technology is finding real world use cases with many projects offering such Blockchain enabled products and services which offer practical solutions in the arena of finance, insurance, supply chain, and even trading with Decentralised Exchanges.
Therefore the crypto market has evolved as well. Now, investing in such projects with real use cases, will only yield investors returns in any upcoming bull market cycle.
Certainly, an investor should invest in Bitcoin, Gold and silver. However, beyond that, they should pick other cryptos of promising Blockchain projects and diversify.
The portfolio should be made by first selecting some established large cap crypto coins like Bitcoin, Ethereum, Litecoin, Dash. They should then consider investing in other promising Mid-Cap crypto projects with real use cases - Ve Chain(VEN), Ark, Link, Binance Coin(BNB), BAT and then small cap crypto projects like coins of well known Defi Projects - Aave, 0x and Kyber Network..
Matter of time, when Bitcoin’s Dominance Rate declines as Alt coins gain prominence
In future, with many alt coins having more use cases than Bitcoin, Bitcoin’s dominance percentage could also come down tremendously, with certain alt coins gaining more market share in the crypto market.
Reference site - https://medium.com/@PanteraCapital/out-performing-bitcoin-pantera-blockchain-letter-june-2020-1d0ac9ec3482
