PriyankaWe recently compiled an extensive list of the 12 Best Cryptocurrencies to Invest in According to Reddit. In this article, we will delve deeper into where Chainlink (LINK) stands among other leading cryptocurrencies.
The past year has been a tumultuous yet exciting journey for cryptocurrency investors. The approval of spot Bitcoin ETFs in the first quarter of the year marked a significant milestone. Following this, the SEC laid the groundwork for spot Ethereum ETFs, eventually giving them the green light in May. This led to a remarkable influx of over $50 billion in combined assets for spot Bitcoin ETFs within just six months of trading. Some experts argue this could be the most successful ETF category ever launched.
In addition to spot offerings, crypto-themed ETFs have also seen impressive performance in the first half of 2024. For instance, the First Trust SkyBridge Crypto Industry & Digital Economy ETF experienced a robust year-to-date (YTD) increase of approximately 20%. Blockchain-focused products are drawing considerable interest from enthusiasts, with the Amplify Transformational Data Sharing ETF rising by over 19% YTD.
AI and Crypto: An Intersection You Should Know About
In recent months, the integration of Artificial Intelligence (AI) into the cryptocurrency world has been noteworthy. AI tokens are cryptocurrencies directly linked to AI ventures, supporting AI-based projects, applications, and services. These include decentralized AI marketplaces and AI-driven decentralized autonomous organizations (DAOs). Users can utilize these tokens for payment services or data access on these platforms, while the platforms themselves can use tokens as rewards to incentivize user engagement. These tokens may also offer holders governance rights within their respective platforms. CoinMarketCap reported a substantial market cap increase of over 70% for artificial intelligence and big data cryptocurrency projects within a few weeks, signaling renewed investor confidence.
Regulation of Cryptocurrency and Related Exchanges
The collapse of major crypto entities like FTX has cast a spotlight on the need for regulatory oversight within the industry. The downfall of such exchanges was largely due to a lack of regulation at the time. However, government entities have since become increasingly proactive in enforcing rules. The Securities and Exchange Commission (SEC) has emerged as the most active watchdog in the U.S. crypto market. CNBC reported that the U.S. is among the most stringent regulators, having taken legal action against several crypto companies. Clear regulatory standards could pave the way for institutional investors—such as banks and asset management firms—to invest in crypto assets.
According to a bi-annual survey by KPMG in Canada and the Canadian Association of Alternative Assets and Strategies (CAASA), around 22% more financial services organizations offered crypto-asset products and services to clients in 2023 compared to 2021. Additionally, about 26% more institutional investors included crypto-related assets in their portfolios in 2023 versus 2021.
Coinbase highlighted that updated 2Q 2024 13-F filings revealed a significant increase in institutional inflows into U.S. spot Bitcoin ETFs. The recent filings showed institutional ownership of these ETFs rose from 21.4% to 24.0% between Q1 and Q2 of 2024, indicating a promising trend for the Bitcoin market.
Cryptocurrency Outlook
The United States International Trade Commission reported that global revenues from tokenized asset exchanges totaled approximately $26.5 billion in 2022, with around 76% derived from cryptocurrencies. Revenues surged significantly in 2021 due to the growth of non-fungible tokens (NFTs) and rising prices of major cryptocurrencies. McKinsey predicts that total tokenized market capitalization will reach approximately $2 trillion by 2030, excluding leading cryptocurrencies and stablecoins. This growth is expected to be driven by adoption across mutual funds, bonds, exchange-traded notes (ETNs), loans, securitization, and alternative funds.
Globally, the cryptocurrency market capitalization surpassed $2.5 trillion, with the world’s largest cryptocurrency hitting a record high of over $73,000. Its market cap reached $1.4 trillion by mid-March 2024. The overall cryptocurrency market is projected to reach approximately $6.6 billion in 2024, with user numbers expected to climb to 107.30 million by 2025. The primary drivers of this growth include increased acceptance and adoption by institutions and individuals, greater use of decentralized finance (DeFi) platforms, advancements in blockchain technology, and higher usage for cross-border transactions.
Our Methodology
We meticulously sifted through various communities, subreddits, and threads to compile our list of the top 12 cryptocurrencies by selecting those trending most prominently. These cryptocurrencies have been ranked in ascending order based on their market capitalization as of August 29.
At Insider Monkey, we are passionate about tracking the stocks that hedge funds invest in heavily. Our research indicates that mimicking the top stock picks of leading hedge funds can lead to market outperformance. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks each quarter, boasting a return of 275% since May 2014 and surpassing its benchmark by 150 percentage points.
Chainlink (LINK) Explained
Chainlink (LINK) is an Ethereum token that powers the Chainlink decentralized oracle network. This network enables smart contracts on Ethereum to securely and efficiently connect with external data sources, APIs, and payment systems. Supported by a diverse community of data providers, node operators, and smart contract developers, Chainlink aims to integrate off-chain data into smart contracts effectively.
Chainlink operates through a network of decentralized oracle nodes that collect data from external sources and relay it to smart contracts. This process allows smart contracts to interact with data outside their native blockchain environment.
A recent collaboration with SWIFT to transfer tokenized assets across multiple blockchains highlights Chainlink’s potential to bridge traditional finance and blockchain technology.
Overall, LINK ranks sixth on our list of best cryptocurrencies to invest in right now. While we recognize LINK’s investment potential, we believe some deeply undervalued AI stocks offer even greater promise for higher returns within shorter timeframes. If you’re interested in an undervalued AI stock trading at less than five times its earnings, check out our report on the most affordable AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.
