After going from a market valuation of $2.2 trillion at the start of 2022 to $800 billion at the end of it, this year has seen somewhat of a cryptocurrency resurgence. The entire industry has gained more than 30% in value in 2023 as of Feb. 9, with investors starting to warm up to digital assets once again.
Both Dogecoin (DOGE -0.70%) and Shiba Inu (SHIB -0.59%), two of the most speculative cryptocurrencies out there, are up significantly so far in 2023. And this might entice investors to get back on the bandwagon in the hope of monster returns in short order. But I think this would be the wrong course of action.
There are three cryptos that are better buys than the dog-inspired tokens.
Lack of real utility
As of this writing, DOGE and SHIB are up 27% and 61%, respectively, in 2023, spurred by renewed investor interest in the asset class. These cryptocurrencies can no doubt see their prices skyrocket in no time, but at the end of the day, they're still just meme tokens with limited utility.
Dogecoin's founders, Billy Markus and Jackson Palmer, stopped working on the project years ago. And while Dogecoin hasn't really done much in the way of network enhancements over the years, its potential to be added as a payments mechanism to Twitter, now owned by DOGE supporter Elon Musk, is driving excitement among the community.
But this is still speculation more than anything else. Consequently, Dogecoin is still primarily driven by community hype, not something to invest behind.
Shiba Inu, on the other hand, has some developments in the works, like a metaverse and a layer-2 scaling solution. The latter, dubbed Shibarium, is meant to speed up transactions and reduce fees, which developers hope can drive greater use of the network. It's encouraging to see these types of projects, but I just don't see why anyone would prefer Shiba Inu over more-promising cryptos out there.
Promising crypto networks
Instead of gambling hard-earned savings on Dogecoin or Shiba Inu, investors are better off taking a closer look at these three smart-contract blockchain networks.
CRYPTO: ETH
Key Data Points
Ethereum (ETH -0.69%), the world's second most-valuable cryptocurrency, was built upon Bitcoin's lack of features to create the first programmable network. Now, with a market cap of nearly $200 billion, Ethereum is the most popular blockchain when it comes to decentralized applications, particularly for non-fungible tokens and decentralized finance protocols.
Ethereum has the most developers working on it. And with the recent successful completion of the Merge, it is now running on an environmentally friendly proof-of-stake (PoS) system. The price of ETH is up 24% in 2023, and 53,000% since its public launch in July 2015.
CRYPTO: ADA
Key Data Points
Another crypto to look at is Cardano (ADA -1.34%), which carries a market cap of $13.3 billion, making it the eighth most-valuable digital asset. What makes it special is its phased development process.
Researchers and computer scientists from top universities are involved in the network's upgrades and updates. While this takes more time compared to other fast-moving cryptos, it ensures that everything is thoroughly thought through.
Cardano has already shown its real-world utility, with enterprise uses in financial services, healthcare, and agriculture. A planned layer-2 solution, known as Hydra, can help the token scale up better.
Cardano has soared 62% this year, and it's up almost 1,500% since its launch in 2017.
CRYPTO: SOL
Key Data Points
Last on this list is Solana (SOL +0.50%). Known for its theoretical throughput of 50,000 transactions per second, Solana runs a PoS system that is bolstered with something called a proof-of-history. This feature eliminates the need to add time stamps to the blocks of data, freeing up space and increasing transaction speeds.
Solana Pay is one system that highlights the network's disruptive potential. It allows a merchant and consumer to transact directly with each other using Solana's blockchain, with instant settlement and almost no fees.
And Saga, a web3-enabled smartphone, could drive greater adoption and activity to the network.
As of this writing, SOL has doubled in 2023. And since its introduction in 2020, its price is up 2,040%.
While it can be incredibly tempting to try to ride the momentum with Dogecoin and Shiba Inu in the hope of achieving a quick profit, Ethereum, Cardano, and Solana are all more-promising blockchains that have brighter futures. For long-term investors, this should be all that matters.
