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Despite the challenge to policymakers and central banks, the cryptocurrency industry’s share value is expected to be upwards of $5.2 billion. It might sound like idle talk, but considering this industry’s market capitalization was $758 billion in 2020 and grew by 187% in 2021, it shows investors and the global populace’s confidence in these decentralized digital currencies.
With the bear market of the coronavirus and now the Ukraine-Russia war, cryptocurrencies have proven to be the new gold. Globally accepted store of value, and with their operation being outside the control of any government, their ability to hedge against geopolitical turmoil and currency fluctuation.
With the world continuing to experience high inflation and the adverse effects of the first open border invasion in Europe since World War Two, these five cryptocurrencies can be a safe haven for your crypto fund.
What is safe haven crypto?
To act as a haven investment, you have to provide a hedge against certain risks. Here we look at the established cryptocurrencies with global recognition and liquidity while trading within acceptable volatility levels.
The top 5 safe haven crypto to include in your crypto fund
The fact is that cryptocurrencies have proven that they are here to stay and the following finance and currency frontier. Unfortunately, the volatility has resulted in many investors shunning them as an everyday investment vehicle. However, these five cryptos provide stability and a chance to utilize cryptocurrency as haven investment assets.
No. 1 Bitcoin (BTC)
Price: $47428.68
Market capitalization: $901.06 B
BTC chart
Having Bitcoin on this list might be debatable given its volatility. However, this cryptocurrency’s popularity and acceptance globally make it a viable option for safe-haven investing.
In the words of Mark Cuban, “Bitcoin’s unique algorithm and its scarcity make it a store of value with no close competition.” The result is a digital currency that will appreciate as its demand expands. As the pioneer cryptocurrency, its acceptance in some circles as a fair exchange for fiat currency, and its ubiquitous utilization across multiple platforms; online games, wallets, payment services, and exchanges, provide for an insatiable market for Bitcoin. Coupled with the growing institutional interest in BTC, and despite its astronomical pricing, this cryptocurrency has plenty of legroom to grow and offer stability to any crypto fund.
BTC currently has a 24-hour trading volume of $32.81 billion. It has a market cap of $901.06 billion, with approximately 19 million coins in circulation out of a total available supply of 21 million coins.
No. 2 Dai (DAI)
Price: $0.9993
Market capitalization: $9.62 B
DAI chart
Dai coin is not as glamorous as Bitcoin and Ethereum, but if stability and a haven are what you seek, it ranks pretty high. DAI utilizes Ethereum blockchain technology, with its issuance and development being under the Maker protocol and MakerDAO decentralized autonomous organization.
All cryptocurrency coins deposited in the MakerDAO vault act as a collateral pool for DAI withdrawal and are then pegged to the dollar’s value in an approximately 1 to 1 ratio. Combine this with smart contracts in DAI issuance and burning, an institutional investor in Andreesen Horowitz, and what you have is a transparent and stable cryptocurrency for use as a hedge against both volatility and green buck currency fluctuations.
DAI currently has a 24-hour trading volume of $288.50 million. It has a market cap of $9.62 billion, with approximately 9.63 billion coins in circulation.
No. 3 Binance USD (BUSD)
Price: $1.00
Market capitalization: $17.56 B
BUSD chart
One of the most in-demand cryptocurrencies is Binance due to its ability to solve the challenges posed by utilizing Ethereum technology. BUSD is one of the few coins pegged to a fiat currency with approval and regulation from a recognized financial authority, the New York State Department of Financial Services (NYDFS).
This formal regulation results from the widespread adoption of the BUSD in the digital space and traditional business setup; digital services, crypto wallets, decentralized and centralized exchanges, and fiat and cryptocurrency digital payment platforms. Add to this the fact that reserves of this digital coin are held incredible assets such as Treasury instruments and federal deposits, and what you have is a genuinely digital haven investment asset.
BUSD currently has a 24-hour trading volume of $6.11 billion. It has a market cap of $17.53 billion, with approximately 17.54 billion coins in circulation.
No. 4 Ethereum (ETH)
Price: $3402.42
Market capitalization: $408.80 B
ETH chart
Bitcoin might be the most popular cryptocurrency, but Ethereum has given it a run for its money. It is an open-source, decentralized blockchain technology that works as the underlying technology for other cryptocurrencies and smart contract executions. Its smart contact feature allows for this technology to be utilized across multiple disciplines making its demand ever-growing, resulting in its stability, an annualized average return of 270% since its launch in 2013.
ETH currently has a 24-hour trading volume of $17.90 billion. It has a market cap of $408.80 million, with approximately 120.17 million coins in circulation.
No. 5 Tether (USDT)
Price: $1.00
Market capitalization: $81.70 B
USDT chart
Ethereum and Bitcoin might be the cryptocurrency’s space big boys, but tether is the heavyweight crypto for those pegged to fiat currencies. It is a digital currency pegged to the dollar value by holding cash, commercial paper, treasury bills, fiduciary deposits, and reserve repo notes. The result is a crypto coin that combines the unrestricted nature of cryptocurrencies and their anonymity with the stability of the green buck to provide a digital haven currency to hedge against currency exchange and market volatility.
This digital store of value asset is currently trading with a 24-hour volume of $85.51 billion. It has a market cap of $81.70 billion, with approximately 81.67 billion coins in circulation.
Final thoughts
The continued sanctions and currency rate fluctuation in the wake of escalating Ukraine-Russia conflict and the resulting rise in consumer product prices due to supply chain disruption have necessitated the need to rethink the safe-haven investment assets.
Citizens of these two countries are witness to the ability of decentralized currencies to operate outside the geopolitical constraints. However, not all cryptocurrencies are created equal. Investing in crypto as a safe haven calls for the coins’ stability, liquidity, security, and volatility to be within acceptable levels.
The five coins herein are a great starting point to ensure your crypto funds survive in the current volatile markets.
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