After Bitcoin dropped to almost $ 40,000 on September 21, many altcoins fell significantly. For example, the Ethereum price for the first time since mid-August fell to $ 3,000 (a 14% decrease since the beginning of the month), and the value of the XRP token fell to $ 0.95 (a 22% drop since the beginning of September). At the same time, the total capitalization of the cryptocurrency market decreased to $ 2 trillion, although at the beginning of September this figure was approaching $ 2.5 trillion (a drop of 20%). Experts from RBC-Crypto explained what is happening with the altcoin market and whether it is worth investing in them.
An important event
At the moment, investors should wait for the US Federal Reserve meeting, which is scheduled for September 22, advised Mikhail Karkhalev, financial analyst at Currency.com crypto exchange. According to him, at this meeting the regulator will consider the possibility of raising the key rate.
“The rate will not be raised, of course, which has already been repeatedly stated by the chairmen of the Federal Reserve. However, at a press conference after the meeting, they can talk about plans or at least hints to curtail emergency stimulus programs and cut the quantitative easing program, ”the analyst explained.
According to Karkhalev, the last decline in the market was caused by the expectation of the curtailment of emergency stimulus programs. If the US Federal Reserve does indeed implement this scenario, then risky assets, including cryptocurrencies, will sink even more, the analyst added.
“After the Fed meeting, especially if the markets are disappointed with the regulator’s statements again, it will be possible to buy out the drawdown,” summed up Karkhalev.
The bull market will continue
The current correction was expected and indicates a further continuation of the bull market, says Dmitry Machikhin, CEO of the service for legitimate work with digital assets Bitnalog. According to him, the market may go into a bearish phase if bitcoin drops below $ 38 thousand.
“All major coin levels have been held and are redeeming well. There is still room to fall, but there is much more room for growth, ”the expert added.
In this situation, when many altcoins have adjusted their rate after growth in August, it makes sense to gain positions on them, says Nikita Soshnikov, director of the Alfacash cryptocurrency exchange service. He warned crypto investors that any investment in altcoins carries an increased risk, and such investments must be made with caution.
“Such investments are not suitable for emotional newbie investors who are prone to impulsive buying and selling, since there is a great risk that with future market drawdowns, and they will be, such an investor will panic and go out of altcoins in the red,” Soshnikov explained.
In conditions of correction, it is worth paying attention to strong projects that have fundamental potential, recommended the financial analyst of the Currency.com crypto exchange. In his opinion, these coins include Uniswap, Cardano, Chainlink, Chiliz, Polkadot and Filecoin.
When choosing altcoins for investment, you should focus on the popularity of the decentralized finance (DeFi) sphere, says the director of the cryptocurrency exchange service Alfacash. He advised to pay attention to Ethereum and Cardanothat provide developers with tools for deploying smart contracts and decentralized applications (dApps). Soshnikov also noted projects Solana and Polkadotas they are designed to facilitate the exchange of assets between different blockchains.
After the market decline, it is worth paying attention to altcoins, which have recently shown significant growth, the CEO of Bitnalog is sure. According to him, they are already underestimated Ethereum, Binance Coin, Solana, Cosmos and Terra… Machikhin also named coins that have high growth potential, but have not yet begun to realize it: EOS and QuarkChain.
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