Home Cryptocurrency Why Altcoins Like Chainlink and Filecoin Slumped This Week

Why Altcoins Like Chainlink and Filecoin Slumped This Week

by admin

Although there were some signs of revival at the end of this week for the altcoin market, many of the more popular assets in the space continued to trade down. For example, according to data compiled by S&P Global Market Intelligence, Chainlink (CRYPTO: LINK) ended the period 9% lower, Filecoin (CRYPTO: FIL) declined by 5%, and Near Protocol (CRYPTO: NEAR) lost over 3% of its value.

We’re still in a period of adjustment after the big market shake-up that followed the launch of spot Bitcoin (CRYPTO: BTC) exchange-traded funds (ETFs). Many coins and tokens are picking themselves off the ground, but slowly.

Spot Bitcoin ETFs still got most of the attention

Bitcoin, by far the most popular cryptocurrency and the one with the highest market capitalization, casts a long shadow over the digital currency landscape. With the debut of those spot Bitcoin ETFs, many people and institutions reallocated their crypto investments toward Bitcoin, to the detriment of altcoins.

As of Friday afternoon, though, it seems this cycle is nearing an end. On Friday, BlackRock‘s iShares Bitcoin ETF became the first spot Bitcoin ETF to hit $2 billion in assets under management (i.e., the sum of all investments controlled by a particular entity for the benefit of its investors). The great whoosh of capital into such assets should thin out into more of a breeze.

Inevitably, focus has now shifted to spot crypto ETFs that are not Bitcoin. Grayscale Investments, a company that was instrumental in bringing spot Bitcoin ETFs to the market and operates one (Grayscale Bitcoin Trust ETF), is pushing to list an Ethereum product.

Yes, the Securities and Exchange Commission (SEC) delayed a decision on approving the Grayscale spot Ethereum ETF — as it did the previous day with a similar Ethereum-based security from the busy BlackRock. Regardless, the fact that non-Bitcoin crypto spot ETFs are likely to hit the market before long is swinging the spotlight back to altcoins.

Waiting for the inevitable — spot altcoin ETFs

The universe of altcoins is large, however, and there are some obscure names toward the bottom of the list. That said, there is clearly much investor hunger for spot crypto ETFs, and you can bet ambitious financial services companies are on the prowl for the right coins and tokens on which to build such products.

Just now, then, I’d say it’s worthwhile for investors to bargain-hunt with some of the more familiar names in the altcoin space — Chainlink, Filecoin, and Near Protocol all fit the bill nicely. These assets have the advantage of anchoring useful functionalities and so have good potential for wider adoption.

Should you invest $1,000 in Chainlink right now?

Before you buy stock in Chainlink, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Chainlink wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.

See the 10 stocks


*Stock Advisor returns as of January 22, 2024


Eric Volkman has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Chainlink, and Ethereum. The Motley Fool has a disclosure policy.

Why Altcoins Like Chainlink and Filecoin Slumped This Week was originally published by The Motley Fool

You may also like

Leave a Comment