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Here are my top 3 cryptocurrency purchases in June
With thousands of cryptocurrencies on the market and a bull run lifting everything up, it can be difficult to cut through the noise and identify the cryptocurrencies most worthy of an investment.
However, as complicated as cryptocurrencies may seem, it is often best to keep them simple. With a little exploration, it won’t take long to understand why these three assets are currently the best candidates for giving your portfolio comprehensive exposure to the best the cryptocurrency market has to offer.
Image source: Getty Images.
1. Bitcoin
Bitcoin (CRYPTO: BTC), the world’s first and best-known cryptocurrency, continues to lead the pack. Recent developments have strengthened its near-term prospects, making it an attractive investment. A significant event is the halving occurred in April. The halving, which occurs approximately every four years, reduces by half the reward miners receive for mining new blocks and effectively reduces Bitcoin’s inflation rate. This inherent scarcity mechanism has historically led to substantial price increases post-halving due to reduced supply.
Furthermore, the approval of Bitcoin spot ETFs in January promises to be a complete game changer. These ETFs allow investors to gain exposure to Bitcoin through traditional brokerage accounts, bypassing the complexities of cryptocurrency exchanges that may have hindered its adoption. This ease of access will likely attract a broader range of investors, including institutional players who have previously hesitated due to regulatory uncertainties and technical barriers to purchasing Bitcoin directly.
We are already seeing the first institutional participants enter the market, adding significant pressure to Bitcoin’s limited supply. Institutions have ample capital at their disposal and if even a small amount of this money flows into Bitcoin, it could result in substantial price appreciation. This institutional interest, combined with Bitcoin’s fundamental strengths, such as decentralization, security, and fixed supply, give Bitcoin the clearest and most secure prospects for future growth.
2. Ethereum
The second cryptocurrency I recommend is Ethereum (CRYPTO: ETH). In the short term, Ethereum is poised to benefit from the upcoming launch of its own spot ETFs. The Securities and Exchange Commission recently gave the green light to eight applicants looking to sponsor Ethereum ETFs, with trading expected to begin this summer.
These ETFs will open the door for more retail and institutional investors to enter the Ethereum market, stimulating demand and potentially boosting its price.
The story continues
Beyond short-term catalysts, Ethereum’s long-term fundamentals are incredibly strong, especially in the decentralized finance (DeFi) space. As one of the most important use cases of blockchain technology, DeFi represents a revolutionary change in the way financial services are provided. Using smart contracts, common financial practices such as lending, borrowing, trading, and more can be performed without intermediaries. To put it simply, DeFi is transforming finance and Ethereum is at the forefront of this innovation.
Currently, over 60% of all DeFi value is locked on the Ethereum blockchain. As the DeFi economy continues to grow, demand for blockspace on Ethereum will also increase, further solidifying its long-term value proposition.
3. Coinbase
Obviously, Global Coinbase (NASDAQ: COIN) is not a cryptocurrency, but it could be the ultimate solution to gaining broad and maximum exposure to the entire cryptocurrency market. As the largest cryptocurrency exchange in the United States, Coinbase offers a wide range of cryptocurrency-related products. Therefore, as the cryptocurrency market grows, Coinbase’s profit potential should also grow.
Most importantly, Coinbase has made great strides in transforming its business model over the years and now boasts several institutional and retail products capable of producing revenue in any market condition. This includes its international expansion, custody services, staking rewards, stablecoin interests, and even the launch of its own blockchain, Base.
These moves are not only a testament to Coinbase’s resilience and ability to innovate, but also position the company for long-term growth. As for cryptocurrencies, they have more room to grow, and in doing so, Coinbase will stand by them.
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RJ Fulton has positions in Bitcoin, Coinbase Global and Ethereum. The Motley Fool has positions and recommends Bitcoin, Coinbase Global, and Ethereum. The Motley Fool has a disclosure policy.
Here are my top 3 cryptocurrency purchases in June was originally published by The Motley Fool