Forget Bitcoin? Only a Handful of Top Cryptocurrencies Have Outperformed It So Far in 2024

Even after the recent crypto market “flash crash,” Bitcoin (CRYPTO:BTC) is still up 35% for the year. While Bitcoin is currently trading well below its all-time high of $73,750 set earlier this year, those 35% gains for Bitcoin look impressive at the moment considering what’s happening elsewhere in the crypto market.

If you analyze the top 50 cryptocurrencies tracked by CoinMarketCap, only a third of them are up for the year. And of those in the green, only a handful are outperforming Bitcoin. So what should investors be buying right now, other than Bitcoin?

What will happen this year?

To answer that question, we first need to consider which investment strategies didn’t work as planned this year. For example, AI crypto tokens were supposed to be some of the breakout stars of the crypto market this year. However, so far, they’ve all still lagged behind Bitcoin. For example, Render (CRYPTO:RNDR) is currently down 4% for the year. And the Artificial Super Intelligence Alliance (CRYPTO:FET) — the crypto token formerly known as Fetch.ai — is up just 24% for the year.

Or what about the so-called “Ethereum killers” that were expected to topple Ethereum (CRYPTO: ETH) this year? With the exception of Solana (CRYPTO: SOL), which is up 53% for the year, they were all huge failures. Cardano (CRYPTO: ADA), for example, is down a full 44%. Avalanche (CRYPTO: AVAX) is down 46%. Aptos (CRYPTO: APT) is down 43%. Granted, Ethereum is currently up only 7% for the year, but at least it’s in the green.

And all of the Layer 2 scaling solutions for Ethereum have also failed. These are blockchains that promise to make Ethereum faster, cheaper, and better. Yet, if you take a look at the best Layer 2 scaling solutions for Ethereum, they are also down for the year. Most notably, Polygon (CRYPTO:MATIC) is down 58% for the year.

What will happen this year?

As you can see, very little has happened so far in 2024. But there is one category of cryptocurrency that has performed admirably, and that’s meme coins. Floki (CRYPTO: FLOKI) — named after Elon Musk’s pet Shiba Inu — is up 254% this year. Pepe (CRYPTO: PEPE) — whose avatar is a green cartoon frog — is up 500%. And Dogwifhat (CRYPTO: WIF), which features a cute dog wearing a cute hat — is up an incredible 1,000% this year.

But there’s just one problem. Meme coins are highly risky and highly speculative, with little to no real-world utility. As such, they’re not suitable for long-term investment portfolios. They’re unlikely to retain their value over time. And they’re subject to extreme price swings due solely to investor whims.

The story continues

This leaves us with a dilemma. Almost every sector of the crypto market is in decline, and the only coins that are solidly outperforming Bitcoin right now are the silly meme coins. So what is the long-term, buy-and-hold investor supposed to do?

To the left

One answer might be: Solana. As mentioned above, Solana is one of the few large-cap cryptocurrencies to have outperformed Bitcoin this year. This is largely because Solana is the only Layer 1 blockchain most closely associated with the “meme coin craze” that has taken over the crypto market this year. So, in many ways, Solana is an indirect play on meme coins, but without taking on as much risk.

Image source: Getty Images.

It seems like everyone — including some entertainment celebrities — is now minting meme coins on the Solana blockchain, leading to a huge spike in Solana’s performance metrics. Most notably, Solana has seen a sharp increase in daily active users. And key metrics related to decentralized finance (DeFi) — like 24-hour trading volume — are also seeing a big spike. That’s because Solana’s decentralized exchanges are the only place you can actively trade most of these new Solana meme coins. As a result, Solana is currently seeing higher trading volume than Ethereum.

Of course, there are other reasons to like Solana beyond the meme coin factor. In terms of overall performance, Solana is cheaper, faster, and more efficient to use than Ethereum. This is something Ark Invest’s Cathie Wood pointed out to institutional investors last November. As a result, Solana could one day be the one blockchain that could topple Ethereum.

And don’t forget Solana’s mobile strategy. Solana was the first major blockchain to launch its own “crypto phone” (Saga), and mobile could be a catalyst for future growth.

If not Bitcoin, then what?

It’s hard to ignore Bitcoin for now. It’s held up well after the crypto market crash and continues to outperform almost every other cryptocurrency. But if you’re looking to turbo-charge your portfolio, consider adding some high-octane Solana.

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

Before buying Solana stock, consider the following:

The Motley Fool Stock Advisor analyst team has identified the 10 best stocks for investors to buy right now… and Solana wasn’t one of them. The 10 stocks that made the list could deliver tremendous returns in the years ahead.

Imagine if Nvidia had made this list on April 15, 2005… if you had invested $1,000 when we made our recommendation, you would have had $641,864!*

Stock Advisor gives investors an easy-to-follow plan for success, including portfolio-building guidance, regular updates from analysts, and two new stock picks each month. Since 2002, Stock Advisor has more than quadrupled the return of the S&P 500*.

See the 10 stocks »

*Stock Advisor returns as of August 6, 2024

Dominic Basulto has positions in Bitcoin, Cardano, Ethereum, Fetch, Polygon, and Solana. The Motley Fool has positions in and recommends Aptos, Avalanche, Bitcoin, Cardano, Ethereum, Fetch, Polygon, Render Token, and Solana. The Motley Fool has a disclosure policy.

The post Forget Bitcoin? Only a Handful of Top Cryptocurrencies Have Overtaken It So Far in 2024 was originally published by The Motley Fool