The financial markets tanked towards the end of the week after Fed Chairman Jeremy Powell took a hawkish stance during the annual Jackson Hole event. During this much-awaited event, Powell said that the Federal Reserve would keep raising interest rates until such a time that inflation is completely dealt with.
This means money will likely flee risky assets, at least in the foreseeable future. However, if you want to play the crypto markets now, some cryptos are likely to show some resilience despite the bearish cloud hanging over the market. Here are a few cryptocurrencies likely to hold on well under current market conditions.
While the broader crypto market is likely to be affected by the bearish cloud across the financial market, Ethereum (ETH) has a good chance of pulling off a surprise rally in early September and probably for the rest of the year. That’s because the upcoming Ethereum merge is a big deal and changes how Ethereum operates in a very big way. The Merge’s impact on Ethereum’s tokenomics is one of the biggest triggers that could see Ethereum perform well regardless of the Fed’s hawkish stand.
For context on how big of a deal this is, one needs to consider that after the Ethereum upgrade of August 5th, 2021, this cryptocurrency rallied when the rest of the market was still weak. Ethereum kept going up, and by November 2021, it had made highs of $4800. If history is anything to go by, this is a cryptocurrency to watch.
If Ethereum is likely to draw investor attention in the coming days, you also need to consider cryptocurrencies that benefit directly from the upcoming Ethereum merge. None stands out in this case than Polygon (MATIC). Polygon is an Ethereum layer-2 cryptocurrency that already has a large ecosystem of cryptocurrencies building on top of it. As such, if the Merge is a success, you can expect to see some level of activity on Polygon, regardless of how the market will be trading at the time.
One of the big reasons behind the Ethereum shift to Ethereum 2.0 is to reduce costs and increase speeds. After the Merge, there is likely a surge in trading volumes for Ethereum tokens. This means platforms that allow for the trading of Ethereum tokens are likely to experience a rise in demand. One of the most established Ethereum token trading platforms is Loopring (LRC). Since there is already strong demand for tokens on Loopring, and with trading costs set to drop, LRC tokens could go up, too. That’s because Loopring is the token that drives the Loopring ecosystem. The more activity, the higher the potential value growth.