In studies and analytical reports on various markets, the concept of blue chips is often used. It also entered the crypto industry.
What Are Blue Chips?
Stock market participants call blue chips the best assets suitable for long-term investment. The term itself is borrowed from poker, where blue chips are more expensive than red and white ones.
Typically, blue chips refer to conservative instruments that form the basis of an investment portfolio. They have several common features:
- High capitalization.
- Crisis resistance.
- Stable growth and dividend payment.
In the traditional market, this category includes Microsoft, Coca-Cola, and other companies from the S&P 500 index.
How To Find Blue Chips In The Crypto Market?
The above criteria are quite applicable to cryptocurrencies. Using them, an investor can independently compile his own list of blue chips. Let’s take a closer look at the algorithm for searching for first-class assets.
The simplest stage of the search is assessing capitalization. This data is displayed in the ratings of all data aggregators like CoinGecko, CoinMarketCap and Cryptorank. It is better to use several sources. Some services provide a breakdown of assets by market segments and categories, which simplifies work in specific areas.
Researching recognition in general is also not a very difficult task. Bitcoin in the mass consciousness is perceived as synonymous with the concept of cryptocurrency. Ethereum and USDT are also quite well known; many people are aware of the current BTC to USDT exchange rate. But how much do you know about AirSwap? Top-notch assets are often known not only within the cryptocurrency community, but also outside the industry. Help to assess recognition:
- Google Trends or similar analytics platforms.
- Search for mentions of the project on news aggregators (general and cryptocurrency).
- Monitoring social networks for asset-related trends
- Research the ecosystem for the presence of well-known investors and partners.
Analysis of price history will provide information on the number of crisis and profitable periods that the asset has experienced, how quickly it recovered, and how its price dynamics correlate with the BTS, traditional markets and indicators. It should be taken into account that many assets are still in a downward trend and their prices are much lower than historical highs. The leaders of the rank and its individual segments are still significantly more expensive than at the time of launch. But the coins of many little-known, unsuccessful and obviously failed projects are now trading even below the starting level.
It is also a good idea to check the ROI of asset holders for certain time periods. It is necessary to take into account not only the profitability of early investors, but also those who bought the asset at a historical or recent local maximum. Services like Financer help you calculate this indicator for the required period.
Ideally, a coin should bring profit to the maximum number of investors, but in the specific conditions of the crypto market, this is much more difficult to realize than in a traditional one. Long-term BTC holders suffered losses for almost a year, until April 2023, when the price of the coin began to recover. For many short-term investors, the bad streak is likely still ongoing.
You’ll end up with a list of assets that reflects your priorities. It may differ from the relatively generally accepted one depending on the market segment and other factors taken as the basis for the study. In its most general form, this list looks something like this:
This cryptocurrency is so well known that it no longer really needs additional advertising. Its price movements still remain one of the most powerful trend-forming factors. At the same time, a large number of users and large trading volumes practically eliminate the possibility of market manipulation. The growth potential of BTS is lower compared to altcoins, but still it is Bitcoin that forms the basis of the crypto portfolios of many investors.
The native token of the Ethereum platform has consistently been among the best assets, as this project laid the foundation for the DeFi segment. The network provides various ETH coins such as paying fees, staking, and providing liquidity.
It is the largest decentralized stablecoin and the main product of the MakerDAO landing platform. DAI allows users to borrow against cryptocurrency. However, you can easily buy it on https://letsexchange.io/exchange/usdt-to-ltc. The platform has a governance token MKR, but DAI is considered a blue chip.
This project is aimed at establishing interaction between on-chain and off-chain markets. ChainLink is the largest supplier of oracles and the project’s native token occupies third position in the DeFi category. The coin is used to pay for network services, manage and participate in the operation of the blockchain platform.
At the end of 2018, the decentralized cryptocurrency exchange Uniswap launched. Currently, about 50% of all decentralized exchanges are carried out on this platform. The UNI token gives users the right to participate in project management and provides the opportunity to earn passive income through staking.
Of course, there are many more stable and promising coins on the market. Each user can find the optimal investment instruments. The main thing is to do your own research and do not invest all your money in crypto assets.