Late this morning, all three of the biggest common cryptocurrency stocks by market capitalization are showing a little green – but there’s a lot more context to look at, even as many of these cryptocurrencies seem like they’re stabilizing.
A glance at the “three musketeers” – BTC, Ethereum and XRP, shows that all three are up over five day lows – monthly charts show Ethereum and XRP stabilizing around their respective values.
Meanwhile, Bitcoin presents its own stability after a precipitous decline early in September down to around the $6,500 mark. At midday, Bitcoin is keeping its head afloat at just over $6,500.
Analysts point out that XRP is quite unlike the other two cryptocurrency stocks in several ways. First, the Ripple company isn’t “all in” or in other words, fully represented by and tied to the XRP stock – the firm has a range of cryptocurrency offerings and operations. So Ripple is really kind of its own animal. Breaking news reports show the company unrolling projects in Japan, which may have an impact on price changes later this week and beyond.
“It is worth pointing out that the app won’t process cryptocurrency-based payments,” wrote Mix at Hard Fork on news that Japan Bank Consortium launched Ripple’s MoneyTap payment app today. “Instead, it will merely utilize Ripple’s distributed ledger technology (DLT) to facilitate payments between banks and institutions.”
As always, investors have to look beyond any momentary greens or reds to figure out what’s really happening with cryptocurrency stocks in general. In many ways, the sector looks bright – but then others warn of overvaluing and volatility and all of the other bugbears that so often come with any new or dynamic sector.
Noting the volatility of crypto, Motley Fool’s analysts have weighed in on another option, which involves selecting the stocks of companies with direct buy-in through the use of cryptocurrencies.
“The cryptocurrency revolution has taken the investing world by storm, and many investors are trying to find the companies that will make their fortunes by concentrating exclusively on bitcoin, Ethereum, and other popular crypto tokens,” writes Dan Caplinger earlier this year in a piece covering some of these secondary or tertiary choices. “Yet with several cryptocurrencies concentrating on making payment transactions more efficient, Mastercard is an appropriate choice for a mainstream company in a position to profit greatly from advances in crypto technology.”
As for Ripple-based plays, Fool writer Matt Frankel recommends American Express, another big financial option with staying power through decades of market activity, which Frankel notes:
“Cryptocurrencies aside, the company has the competitive advantage of an affluent cardholder base, with the average Amex cardholder spending about five times as much on their card as the average credit card customer.”
Investors can get insights from sources like this to spread out a crypto play. Looking at a diversified portfolio means tracking not only underlying BTC or Ethereum prices, but other stocks that lean heavily on the Cryptocurrency 2.0 trend.