In this article, we discuss 7 best cryptocurrencies Redditors are buying.
The market volatility will likely impact consumer confidence and spending at the stock market. Elite hedge funds and retail investors alike are shaken by the market swings. According to Robinhood Financial, Acorns, and Vanguard, there has been a 47%, 17%, and 15% increase in awareness regarding trade and investment among US young adults from March 1 to September 20, respectively. In addition to equities, retail investors are pouring into cryptocurrencies as they believe that digital money will prevail in the future.
Perhaps the might of retail traders can be attested by their coordinated attack on hedge funds who were shorting famous meme stocks, AMC Entertainment Holdings, Inc. (NYSE:AMC) and GameStop Corp. (NYSE:GME), last year. The two stocks soared to unfounded highs, making some retail traders millionaires overnight.
Currently, millennial and Gen Z retail traders are experiencing the highest inflation of their lifetimes, tightening monetary policies by the Federal Reserve, and their first bear market apart from the pandemic-driven period. This is contracting their trading activity and resulting in a gloomy outlook for stocks. However, Bitcoin has rallied in the last few days whereas strong currencies like the US dollar, British Pound Sterling, and the Chinese Yuan have weakened. The adoption of cryptocurrencies has increased as companies like Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Mastercard Incorporated (NYSE:MA) support digital currency transactions and invest in blockchains.
Our Methodology
We scoured subreddits like r/CryptoCurrency, r/CryptocurrencyICO, and r/CryptoMarkets to assess the most popular cryptocurrencies among Redditors in the last week. The details of each cryptocurrency are mentioned along with a discussion around prominent firms working to mainstream the adoption of digital currencies, in order to provide readers with some context for their investment decisions. A database of 895 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to assess the hedge fund sentiment around these firms.
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Best Cryptocurrencies Redditors Are Buying
7. Binance Coin
Binance is the largest cryptocurrency exchange based on daily trading volume. Binance Coin is the native currency of the Binance platform, and it powers the Binance Chain ecosystem. It is one of the most popular utility tokens, with multiple applications and use cases. Binance Coin saw a notable price increase at the beginning of 2021, which has put it on the radar of enterprise and retail investors alike. Binance Coin was launched through an Initial Coin Offering in 2017 and the issue price was 1 ETH for 2,700 BNB or 1 BTC for 20,000 BNB. It is one of the best cryptocurrencies Redditors are buying lately.
Binance Coin has multiple applications and use cases. For example, using BNB can result in lower trading fees on the Binance exchange and the currency can be used for transaction fees on the BNB Smart Chain. Users can purchase goods and services both online and in-store, using Binance Card or Binance Pay. Additionally, BNB allows holders to book hotels, flights, and more at Travala.com. The adoption of cryptocurrencies has become mainstream due to the efforts of companies like PayPal Holdings, Inc. (NASDAQ:PYPL), which back crypto transactions.
Among the hedge funds tracked by Insider Monkey as of Q2 2022, 97 hedge funds were bullish on PayPal Holdings, Inc. (NASDAQ:PYPL), with collective stakes worth $5.2 billion, compared to 100 funds in the prior quarter worth $6.2 billion. Ken Fisher’s Fisher Asset Management is the largest position holder in the company, with 17.3 million shares valued at $1.2 billion.
Like Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Mastercard Incorporated (NYSE:MA), elite hedge funds are piling into PayPal Holdings, Inc. (NASDAQ:PYPL) for exposure to the crypto economy.
Here is what RiverPark Wedgewood Fund has to say about PayPal Holdings, Inc. (NASDAQ:PYPL) in its Q2 2022 investor letter:
“PayPal Holdings detracted from performance despite the Company generating healthy growth. Revenue grew +8%, but closer to +15% when adjusted for the well-telegraphed roll-off of its eBay relationship. As the Company laps the headwinds of eBay and difficult year-ago comparisons, we expect PayPal should drive long-term growth in the mid-teens. Much of this will be driven by further penetration into the Company’s nearly 450 million active users.
PayPal’s user base has grown by +50% since the onset of the pandemic so it makes sense for management to focus on driving higher transactions per account and better monetize this historical windfall of users. In our opinion, the shares have discounted away all of PayPal’s pandemic user and revenue gains, so we added to positions during the quarter.”
6. LUNA Classic
Terra is a blockchain protocol that utilizes fiat-pegged stablecoins to power global payments systems. Terra delivers price stability and the underlying fiat currencies offer fast and affordable transactions. As of September 2021, Terra provides stablecoins pegged to the U.S. dollar, South Korean won, Mongolian tugrik, and it plans to roll out additional currencies. At the end of May 2022, Terra’s original native token, LUNA, was rebranded as LUNA Classic. Terra was founded in January 2018 by Daniel Shin and Do Kwon. The founders intended to drive the quick adoption of blockchain technology and cryptocurrency, with a strong focus on price stability and usability. Redditors are pouring into LUNA Classic lately.
Companies like Block, Inc. (NYSE:SQ) have voiced long-term commitment to blockchain technology and the company is extremely focused on Bitcoin. At the end of the second quarter of 2022, 72 hedge funds in the database of Insider Monkey held stakes worth $3.5 billion in Block, Inc. (NYSE:SQ), compared to 84 in the earlier quarter worth $6.1 billion. Cathie Wood’s ARK Investment Management is the leading Block, Inc. (NYSE:SQ) stakeholder, with shares worth $799.5 million.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Block, Inc. (NYSE:SQ) was one of them. Here is what the fund said:
“Block, Inc. (NYSE:SQ) provides point-of-sale technology to small businesses and operates the Cash App ecosystem of financial services for individuals. Shares fell due to mixed quarterly results with more modest growth in the Seller business offsetting strength in Cash App. While integration of recently acquired Afterpay is progressing well and credit metrics remain healthy, the buy-now-pay-later business slowed due to greater competitive intensity. We continue to own the stock due to Block’s long runway for growth, sustainable competitive advantages, and unique corporate culture.”
5. Litecoin
Litecoin is another cryptocurrency that Redditors are loading up on. Litecoin was designed to deliver fast, safe, and affordable payments. Litecoin was developed based on the Bitcoin protocol, however, it is different from Bitcoin as it uses a separate hashing algorithm, hard cap, and block transaction times, among other factors. Litecoin is feasible for small transactions and point-of-sale payments, given its relatively fast block time of only 2.5 minutes and extremely cheap transaction fees. Litecoin is decentralized money which is free from censorship and available to all.
Intel Corporation (NASDAQ:INTC) is one of the leading firms in the crypto universe, which promotes the faster adoption of cryptocurrencies like Litecoin. According to the Q2 database of Insider Monkey, 65 hedge funds were bullish on Intel Corporation (NASDAQ:INTC), compared to 76 funds in the preceding quarter. David Blood and Al Gore’s Generation Investment Management is the largest position holder in the company, with 14.7 million shares valued at $552.5 million.
In addition to Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Mastercard Incorporated (NYSE:MA), Intel Corporation (NASDAQ:INTC) is one of the biggest players in the crypto universe.
Here is what Baron Funds specifically said about Intel Corporation (NASDAQ:INTC) in its Q2 2022 investor letter:
“Then, there is the case of Intel Corporation (NASDAQ:INTC). A blue-chip tech champion with a market capitalization of over $500 billion in early 2000, the stock was trading at a P/E multiple of 42. It was a fast-growing company whose stock price and multiple declined more or less in line with its peers. However, unlike Google, Intel’s net income has grown from $7.3 billion in 1999 to $19.9 billion in 2021, a compounded annual growth rate of just 4.7%. Its growth from the dot com era has not proven to be durable, and Intel has yet to trade at the price it attained in 1999.”
4. Monero
Monero was launched in 2014, and it aims to offer transactions which are private and anonymous, using advanced cryptography. Although Monero’s founders remain largely unidentified, it is rumored that the coin was developed by Satoshi Nakamoto, the inventor of Bitcoin. Monero is highly decentralized and completely fungible. As a result, information about senders, recipients, and the amount of crypto being transferred are shrouded to provide maximum privacy. To ensure that transactions cannot be traced, stealth addresses are created for every transfer, and each stealth address is used only once. Monero is one of the cryptocurrencies that Redditors are actively buying.
Currencies like Monero are being adopted widely as reputable firms like Microsoft Corporation (NASDAQ:MSFT) back their progress. According to Insider Monkey’s Q2 data, 258 hedge funds were bullish on Microsoft Corporation (NASDAQ:MSFT), compared to 259 funds in the prior quarter. Ken Fisher’s Fisher Asset Management featured as the biggest position holder in the company, with 28.6 million shares valued at $7.3 billion.
Here is what Baron Durable Advantage Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q2 2022 investor letter:
“Shares of Microsoft Corporation, a leading global provider of software solutions, declined 16.6% in the quarter along with the broader software group as well as due to growing concerns of a potential macro-driven slowdown. This is despite the company posting strong quarterly financial results and successfully absorbing headwinds from the war in Ukraine. The company had 21% revenue growth, 23% operating income growth, and 35% growth in Microsoft Cloud (all year-over-year in constant currency), which now represents 47% of total revenues.
As discussed above, we continue to believe Microsoft remains a durable and growing business as companies across all industries look to digitally transform, taking advantage of the continuously expanding solution set Microsoft has to offer.”
3. Cardano
Cardano is a proof-of-stake blockchain platform that aims to bring about positive global change. It is an open-source project that was launched in 2017. The native ADA token is designed so that users can participate and carry out transactions on the Cardano network. Those who own ADA tokens can vote for proposed changes to the underlying software. In 2020, Cardano underwent a Shelley upgrade to make its blockchain “50 to 100 times more decentralized” as compared to alternative blockchains. Cardano was founded by Charles Hoskinson, one of the co-founders of Ethereum.
Apple Inc. (NASDAQ:AAPL) is one of the American technology giants that are backing the development of the cryptocurrency space, by allowing Apple Pay to purchase cryptocurrencies and supporting blockchain technology via strategic investments. Among the hedge funds tracked by Insider Monkey, Warren Buffett’s Berkshire Hathaway is the biggest stakeholder of the company, with approximately 895 million shares worth $122.3 billion. Overall, 128 funds were bullish on Apple Inc. (NASDAQ:AAPL) at the end of June, compared to 131 funds in the prior quarter.
Here is what Alger Capital specifically said about Apple Inc. (NASDAQ:AAPL) in its second quarter investor letter:
“Apple Inc. (NASDAQ:AAPL) is a leading technology provider in telecommunications. computing and services. Apple’s iOS operating system is the company’s unique intellectual property and competitive strength. This software drives extremely tight engagement with consumers and enterprises. The engagement is fostering the growing purchase of high-margin services like music, apps, and apple pay. Apple’s shares detracted from performance as management lowered its guidance for the second quarter due to headwinds from the war in Ukraine, adverse foreign currency shifts, and dampened consumer demand associated with the coronavirus in China. Additionally, many investors were concerned that lockdowns implemented to curtail the spread of COVID-19 would impact production of apple products, however the manufacturing facilities have resumed activity.”
2. USD Coin
USD Coin is a stablecoin pegged to the U.S. dollar on a 1:1 basis. Each coin in circulation is accompanied by $1 held in reserve, in a combination of cash and short-term U.S. Treasury bonds. USD Coins are issued by regulated financial institutions. USD Coin is working to develop an ecosystem where the currency will be accepted by multiple wallets, crypto exchanges, service providers, and decentralized apps.
Cryptocurrencies like USD Coin are supported by firms like Mastercard Incorporated (NYSE:MA), which allow customers to use digital currencies for daily transactions. Mastercard Incorporated (NYSE:MA) also helps blockchain and digital asset companies with operational scalability. According to Insider Monkey’s data, 137 hedge funds were bullish on Mastercard Incorporated (NYSE:MA) at the end of Q2 2022, compared to 136 funds in the prior quarter. Charles Akre’s Akre Capital Management is the leading stakeholder of the company, with 5.8 million shares worth $1.8 billion.
Here is what Baron Fintech Fund has to say about Mastercard Incorporated (NYSE:MA) in its Q2 2022 investor letter:
“The Fund’s holdings in the Payments and Information Services themes also contributed to relative performance. Within Payments, lower exposure to this lagging theme and outperformance of Mastercard Incorporated (NYSE:MA) added the most value. These global payment networks are viewed as safe havens during market downturns but are also benefiting from resilient payment volumes and a sharp rebound in international travel.”
1. Bitcoin
Bitcoin is the oldest decentralized cryptocurrency that has first-mover advantage in the crypto universe. It has managed to build a global ecosystem, with millions of crypto enthusiasts investing in the currency. Bitcoin remains the crypto market leader even after more than a decade of its launch and after multiple currencies turning up in its wake. It is the safest form of crypto investment and one of the best cryptocurrencies that Redditors are buying.
Alphabet Inc. (NASDAQ:GOOG) is one of the most prominent companies looking to explore crypto and blockchain potential, with heavy investments in the space. Among the hedge funds tracked by Insider Monkey, Alphabet Inc. (NASDAQ:GOOG) was part of 153 hedge fund portfolios at the end of Q2 2022, compared to 160 in the earlier quarter. Harris Associates is a notable stakeholder of Alphabet Inc. (NASDAQ:GOOG), with 1.75 million shares worth $3.8 billion.
Here is what Baron Durable Advantage Fund has to say about Alphabet Inc. (NASDAQ:GOOG) in its Q2 2022 investor letter:
“Alphabet Inc. is the parent company of Google, the world’s largest search and online advertising company. Shares of Alphabet declined 21.6% in the quarter due to concerns about slower global growth impacting the company’s core advertising business. We retain conviction in Alphabet’s merits as it continues to benefit from growth in mobile and online video advertising, which accrues to its core assets of search, YouTube, and the Google ad network. We are further encouraged by Alphabet’s investments in Cloud, AI, and Autonomous Driving (through its Waymo subsidiary).”
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Disclosure: None. 7 Best Cryptocurrencies Redditors Are Buying is originally published on Insider Monkey.
