Cryptocurrencies are here to stay. There - I said it.
The big names in the space are attracting a lot of interest from institutional investment firms. Governments around the world are grappling with the legal and regulatory future of decentralized financial systems. Investors and cryptocurrency enthusiasts envision ultra-fast and low-cost payment alternatives, digital banking apps with ultra-customized feature sets, and radically different solutions for copyright, asset management, and automated contracts.
Many of the major cryptocurrencies make sense as investments in this rapidly evolving market. Ethereal has firmly established itself as the leader in smart contractspowered by an ambitious list of recent and upcoming technical enhancements. Bitcoin remains the gold standard for hard-to-hack store of value. AND Yof Web3 is the future of the webso Moles It should become the best way to take advantage of many different cryptocurrencies in a single application or service.
And that's not all. Even some of the seemingly dumb crypto ideas can find useful niches in the long run. dogecoin It may be a literal joke, but their platform is a technically sound Bitcoin clone with minor tweaks that trade some of Bitcoin's unbreakable security for faster transaction processes. Shiba Inu is an experiment in social project management wrapped in adorable marketing and combined with the sophisticated ShibaSwap trading platform. Both Dogecoin and Shiba Inu have seen their market values โโskyrocket and fade due to social media posts and other factors that have no real connection to any form of trading value. But what if they could get over their "dumb fluff" labels and be judged on their technical merits?
So I'm not here to tell you that Shiba Inu or Dogecoin are worthless bets. I mean, they are far from my favorite crypto names nowadays, but they just might be able to earn their stripes in the long run. i wouldn't dare bet against them.
Still, I wouldn't really touch some popular cryptocurrencies even with a 10-foot pole. For example, this is why I think you should stay away from classic earth (CRYPTO: MOON) and Pepe (CRYPTO: PEPE).
Image source: Getty Images.
What's wrong with Terra Classic?
You might remember the TerraUSD crash of 2022. The algorithmic stablecoins now known as USD Classic Land it lost its close connection to the desired price of $1 per token. The coin's backers tried to prop up the stablecoin by buying more Bitcoin and other cryptocurrencies, but cryptocurrency prices were already plummeting due to high inflation in the broader economy and interest rate hikes from the Federal Reserve, for example. what those desperate efforts failed.
Investors lost their confidence in TerraUSD. The massive withdrawals caused a thunderous crash and TerraUSD fell as low as $0.006 per token. Remember, this digital currency was supposed to serve as a direct replacement for the old US dollars with a price that held steady at the $1 mark.
That crisis added fuel to the fire that was already putting pressure on the crypto market at the time. For example, Bitcoin fell from $38,000 to $29,000 amid the TerraUSD crash.
the backup Land the blockchain was relaunched hoping to rebuild what was lost in the TerraUSD accident. So far, Terra 2.0 seems to have a healthy list of decentralized finance projects in development, but I don't see a revamped version of the TerraUSD stablecoin.
The Terra Classic coin represents the fading embers of a once thriving but now completely failed and forgotten project. Its price hovers around the $0.0001 mark, or 100 Terra Classic tokens per US penny. The related stablecoin is faring slightly better, with prices floating just above $0.01 per course digital dollar.
Terra Classic may sound like an old cryptocurrency with a solid future, but nothing is further from the truth. Speculators could try their luck with the relaunched Terra (LUNA) coin, but the Terra Classic iteration is just the residue of a dead project. Its price moves up or down for no good reason every day, and will almost certainly fall to zero in the long run.
Image source: Getty Images.
Why doesn't Pepe seem like a serious investment?
I mentioned Dogecoin and Shiba Inu earlier, but there is a long list of even stranger meme coins. Pepe is the most popular of these at the moment, and I see no reason to take him seriously.
Pepe is a Ethereum-based ERC-20 token, just like Shiba Inu. The coin is also based on the classic internet meme for your branding and marketing. But that's where his similarity to Shiba Inu ends.
Its official logo is Pepe the Frog, a roughly sketched caricature that has taken on ugly political overtones over the years. That the developers of a new cryptocurrency are choosing to link it to such a controversial meme is just the first of many red flags when it comes to Pepe.
The coin's official website offers another warning sign. The antivirus functions of my network router do not allow me to view that page directly. Many online security specialists flag it as suspicious, citing its similarity to known scam sites.
Searching the site through secure Internet Archive snapshots, I found a three-phase operating plan that culminates in Pepe's merchandise being sold in the midst of a "meme takeover." This is how the project describes itself:
"PEPE is a meme coin with no intrinsic value or expectation of financial return. There is no formal team or roadmap. The coin is completely useless and for entertainment purposes only."
It could go further, but that should be enough. Pepe's developers do not have high ambitions to launch successful decentralized financial services, nor for the tokens to gain value over time or serve any useful purpose. It's the Dogecoin joke again, but taken to the next level of nonsensical speculation.
Image source: Getty Images.
The world of cryptocurrencies is diverse and dynamic. Some would call it chaotic. Still, there are clear levels of separation between the different classes of cryptocurrency investments.
Robust currencies like Ethereum, Bitcoin, and Polkadot are playing an important role in the digital economy. One step further down, the likes of Dogecoin and Shiba Inu are proving that even "joke" coins can find niches in the long run.
However, not all that glitters is digital gold. Cryptocurrencies like Terra Classic and Pepe serve as a reminder that careful research and due diligence are essential before investing. There is land mines and hidden dangers in this entire market. Make sure your cryptocurrency investments match up your risk profileAnd don't put your money into digital assets without delving into the fundamental value and future prospects of each coin.
