It's tempting to try and find that next big cryptocurrency. Even though you could potentially see incredible returns this way, it's also difficult, time-consuming, and extremely risky.
For starters, you'll need to look for cryptocurrencies with the potential to explode outside the market leaders. Smaller cryptocurrencies may have greater growth potential, but they're also more likely to fold, so there's a bigger chance of losing your entire investment. To balance that out, you might want to consider cryptocurrency stocks or large-cap coins.
The most exciting thing about cryptocurrency investments is that when they explode, they skyrocket in value. In 2021, we saw Solana (SOL -7.03%) increase by more than 10,000%. Meme token Shiba Inu (SHIB -3.47%) shot up more than 40,000,000%.
Of course, things haven't gone nearly as well since then. Crypto entered a bear market, and prices of most major coins fell significantly. Although there's no guarantee that crypto is here to stay, the market has bounced back before.
It's obviously impossible to know the next cryptocurrency to explode. However, you can pick out some possible candidates that are capitalizing on current trends including artificial intelligence (AI), decentralized apps (dApps), and digital payment solutions.
First, let's look at how to get started and some key factors that signal a coin’s potential to explode.
How to Trade the Next Crypto to Explode – Quick Guide
You can trade Cryptocurrency CFDs with CAPEX.com through the device of your choice, be it a smartphone, PC, or tablet. It’s straightforward:
1. Open and fund your account
We'll ask you a few questions about your trading experience. We aim to complete the verification process as quickly as possible so you can start trading on a huge range of markets.
2. Research your next big crypto
It is imperative to acknowledge that cryptocurrency trading entails a significant degree of risk, and comprehensive research is necessary prior to making any investment decisions.
3. Open and monitor your trade
When you trade cryptocurrencies on CFDs (Contract for Differences), you’re speculating on whether the price will rise or fall, and you don’t own any underlying coins.
Key Factors in Discovering the Next Cryptocurrency to Explode
Identifying the next cryptocurrencies to explode or the next big crypto requires a balanced, informed approach. Let’s initiate a few factors that could indicate a cryptocurrency’s potential for high growth in the market, according to analysts and industry leaders.
1. Market dynamics and historical context
When identifying cryptocurrencies with the potential to explode, a deep dive into market dynamics and historical context is essential. This involves looking beyond simple price trends to understand the underlying factors driving market movements and how they can inform future crypto price predictions. Here are some factors to consider:
Understanding market cycles
Cryptocurrency markets move in cycles, typically characterized by periods of rapid price increase (bull markets like in 2017, 2021 or 2023) followed by downturns (bear markets like in 2018 or 2022). Understanding these cycles can help in predicting when the market might turn bullish again and which are the best-positioned cryptocurrencies to explode. Always remember that trend is your friend, but trends can always change.
Historical price movements
Examining the price history of successful cryptocurrencies reveals patterns. Ethereum’s rise was fuelled by the ICO boom, as it was the primary platform for these offerings. Similarly, in the 2020-2021 bull run, Defi tokens experienced significant growth due to the burgeoning interest in such applications. To find the next crypto to explode, you need to check what’s driving the market now and in 2024.
Volume and market capitalization
These are crucial metrics when researching cryptocurrencies with the potential to explode. A sudden increase in trading volume can indicate growing investor interest, often preceding price increases. Market capitalization gives a sense of the relative size and dominance of a cryptocurrency. A low market cap coin might have higher growth potential, but also higher risk compared to a large market cap coin.
External market factors
Global economic factors, such as inflation rates, economic downturns, monetary policies, or stock market crashes, can also influence the crypto market. For example, the COVID-19 pandemic initially led to a crypto market crash in March 2020, but subsequently, there was increased interest in cryptocurrencies as a potential hedge against inflation and economic uncertainty.
Remember that while past performance is not always indicative of future results, it can provide insights in searching for the next crypto to explode. Cryptocurrencies that have shown resilience and consistent growth over multiple market cycles may be poised for future success. However, it’s crucial to balance this with an assessment of current trends and future potential based on technological advancements and market shifts.
2. Technological innovation and practical uses
In 2024, identifying the next cryptocurrency to explode requires a nuanced approach that considers a spectrum of factors beyond mainstream coins. This entails delving into diverse technological innovations and assessing their real-world applicability across various sectors. Here’s a deeper and more insightful look:
Exploring technological breakthroughs
Beyond the well-known projects, there are numerous new cryptocurrencies innovating in areas like sidechains, off-chain computations, and advanced consensus algorithms. For instance, coins focusing on quantum resistance or implementing advanced cryptographic methods could gain prominence as cybersecurity becomes a paramount concern in the crypto space in the future.
Real-world utility
The next crypto to explode could be one that extends blockchain utility beyond financial transactions. This includes projects focusing on decentralized data storage, digital identity verification, or supply chain optimization. Cryptocurrencies involved in these, or any other sectors may offer groundbreaking solutions to real-world problems, driving their value and adoption.
Cross-chain solutions
As the blockchain ecosystem becomes more fragmented, cryptocurrencies that facilitate interoperability between different networks could play a pivotal role. Projects working on cross-chain solutions or blockchain bridging protocols could be the next coin to explode, as they enable seamless interaction between disparate blockchain systems.
Regulation compliance
Coins that are proactively addressing regulatory compliance issues might have a competitive edge, especially in jurisdictions with strict regulatory frameworks. Additionally, with the increasing focus on sustainability, cryptocurrencies that offer energy-efficient transaction processing could gain significant attention.
Remember that for new or emerging cryptocurrencies, it is essential to evaluate the maturity of the project, the experience of the team, the clarity of their vision, and the responsiveness to community feedback. Early-stage projects that demonstrate a clear path to market application and user adoption might be among the altcoins to explode in 2024.
3. Community engagement, development actions, and strategic partnerships
A cryptocurrency with a strong, active community and significant development activity, coupled with strategic partnerships that enhance its utility and integration into larger ecosystems, is more likely to experience sustained growth and success:
Community engagement and development activity
The strength and activity of a cryptocurrency’s community, alongside its development efforts, are critical indicators of its potential for success and growth. A vibrant community often translates to a robust support system for the cryptocurrency, fostering innovation and adoption. Developer activity, on the other hand, reflects the ongoing commitment to improve and evolve the platform, which is crucial for its long-term viability.
Strategic partnerships and ecosystem integration
The partnerships a cryptocurrency forges and its integration into broader ecosystems can significantly impact its market performance. Strategic partnerships often serve as a validation of the cryptocurrency’s technology and its potential for real-world application. A prime example are cryptocurrencies which have formed partnerships with numerous financial institutions for cross-border payments.
Remember that when assessing a cryptocurrency’s potential to explode, it is important to look at both its internal community and development dynamics, as well as how it interacts with and is perceived by external entities through partnerships.
5 Cryptocurrencies with Potential to Explode in 2024
There are thousands of options to choose from in today’s crypto market, and each of them has different strengths, weaknesses, varying degrees of potential, and origin stories. Here are 5 cryptocurrencies with the potential to explode based on analysts' coverage and price predictions from websites using machine learning models, like Trading Economics, Wallet Investor, or Coin Price Forecast.
Remember, this is not a recommendation of what crypto you should buy or not, merely a list of some of the largest projects ranked by market capitalization so you can get a sense of the playing field before you decide whether to roll the dice and invest in crypto.
1. Ethereum (ETH)
Ethereum (ETH) might not appear as it belongs to the next crypto to explode list at first. It's not unnoticed. Most cryptocurrency investors are aware of it because it has been the second-largest cryptocurrency after Bitcoin for a long time.
Why could Ethereum be the next crypto to explode?
Ethereum went through its long-awaited change to a proof-of-stake system in September 2022, significantly improving its energy efficiency. The upgrade also means it's now possible to stake Ethereum and earn more, which could help attract more investors. Overall, Ethereum has great growth potential without the extreme volatility of smaller cryptos. Sectors like DeFi and NFTs look only set to grow in the coming years, and Ethereum will play a key role in their development.
The risks involved
Ethereum is a pioneer in crypto innovation, but the risk of delays in upgrades, as observed in the past, could potentially hinder its growth. Additionally, Ethereum faces competition from rivals like Solana which pose a significant threat to its current dominance.
2. Ripple (XRP)
XRP is the native cryptocurrency for Ripple, a payment protocol that uses blockchain technology for fast, inexpensive transactions. Ripple was designed to facilitate international transfers, and it has partnered with hundreds of financial institutions that use its technology. Ripple has been around since 2012, but it became embroiled in a Securities and Exchange Commission (SEC) lawsuit at the end of 2020, prompting most major U.S. crypto exchanges to delist the company.
Fortunately for investors, Ripple (mostly) came out on top in its long battle against the SEC. A judge ruled that Ripple didn’t violate security laws by selling XRP tokens on crypto exchanges, but it did through sales to institutional investors. Still, the news led to a jump in XRP’s price, and it could lead to further increases in the cryptocurrency’s value and trading volume.
Why could XRP be the next crypto to explode?
Ripple’s original mission was bold, and it seems to be finally paying off. The recent legal victory led to a 70%+ surge in XRP’s price, demonstrating how supportive investors are of Ripple. Its lightning-fast settlement times and minute fees make it a preferred choice for both individuals and businesses. While Ripple Labs isn’t completely out of the woods yet, the legal standing seems to point in its favor.
The risks involved
While XRP is often touted as the next big cryptocurrency to explode after it scored a win against the SEC, Ripple execs Chris Larsen and Brad Garlinghouse still face outstanding lawsuits. Litigation could suppress Ripple’s price and damage sentiment amongst the community.
3. Monero (XMR)
Monero (XMR) is the best-known privacy coin, a cryptocurrency with anonymous, untraceable transactions. It uses privacy-enhancing technology so that the sender, recipient, and amount of every transaction are hidden. Monero alleviates privacy concerns using the concepts of ring signatures and stealth addresses. Ring signatures enable a sender to conceal their identity from other participants in a group. Ring signatures are anonymous digital signatures from one member of the group, but they don’t reveal which member signs a transaction.
Why could Monero be the next crypto to explode?
There are plenty of people who want to keep their cryptocurrency transactions private, especially as regulations become stricter. That gives Monero a clear use case and makes it a dark-horse pick for a crypto that could see continued success.
The risks involved
Monero will likely face the most scrutiny from law enforcement and government officials down the line due to its default privacy. On the other hand, one of the Monero mining pools — individual miners who pool computing power and rewards — has grown to control 44% of that computing power, known as hash power, putting it far too close to a majority stake for comfort.
4. AAVE
AAVE is a decentralized finance (DeFi) protocol and lending platform. It allows users to lend and borrow cryptocurrency, and everything is done with smart contracts, so there’s no middleman required. Users can earn interest on the digital assets that they lend. Besides the direct connectivity to the Ethereum ecosystem, Aave has compatibility with both the Avalanche ecosystem and the L2 Polygon network as well.
Why could AAVE be the next crypto to explode?
As part of that partnership, AAVE has built a Real-World Asset (RWA) Market. It allows companies to tokenize parts of their businesses. Investors can buy tokens offered by those businesses. The issuers of the tokens can then borrow stablecoins against their assets.
The risks involved
Arguably the most significant vulnerability for AAVE is within its governance model. AAVE protocol is like other crypto projects in that it deploys a “one token, one vote” approach. The problem with this is it gives substantially higher voting power to early investors and whales. On the other hand, yields are typically lower than most, newer DeFi products.
5. Cardano (ADA)
Cardano (ADA) is a promising blockchain platform that aims to address the scalability, interoperability, and sustainability issues that have plagued other blockchain networks. Developed with a rigorous research-driven approach, Cardano seeks to build a robust and future-proof platform capable of supporting a wide range of applications, from decentralized finance to smart contracts and beyond.
Why could Cardano ADA be the next crypto to explode?
Despite its slower development speed relative to some competitors, Cardano’s systematic and research-driven approach has attracted a substantial following in the crypto community. As the platform continues to evolve and deliver on its ambitious roadmap, Cardano’s potential for growth and widespread adoption makes it a cryptocurrency worth considering for investors seeking exposure to a cutting-edge blockchain project.
The risks involved
ADA may be “overvalued” compared to other smart contract blockchains as it is an unfinished product with limited utility, while other blockchains it competes with have more development and usage; though Cardano boasts years of research and marketing, it is still in an early stage of development and much of its current value may be based on its potential.
Are These the Next Crypto to Explode in 2024?
When you research the next crypto with the potential to explode in 2024, it’s crucial to approach the market with a blend of curiosity and caution. The quest for the next crypto coin to explode is not just about spotting trends; it’s about understanding the delicate balance of technology, market dynamics, and investor sentiment.
The allure of penny cryptos and low-price tokens is undeniable, but so is the need for thorough research and risk assessment. The possibility of altcoins exploding in value is always there, especially those that bring something new to the table, be it in technology, utility, or community engagement.
For those seeking the next crypto to explode, it’s about staying informed, being patient, and making calculated decisions. This journey is not just about finding the next big hit; it’s about being part of an evolving digital economy.
Trading and Investing in the Next Crypto to Explode
There are two direct routes to investing in the next big crypto: speculating on their prices using CFDs or buying the underlying coins in the hope they increase in value.
CFD trading on cryptocurrencies
Crypto trading is derivatives, that enable you to speculate on their price movements without taking ownership of the underlying coins. You can go long (buy position) if you think a cryptocurrency will explode in value, but also short (sell position) if you think it will fall.
Both are leveraged products, meaning you only need to put up a small deposit – known as margin – to gain full exposure to the underlying market. Your profit or loss is still calculated according to the full size of your position, so leverage will magnify both profits and losses.
Buying and selling crypto via an exchange
When you buy cryptocurrencies via an exchange, you purchase the coins themselves. You’ll need to create an exchange account, put up the full value of the asset to open a position, and store the cryptocurrency tokens with the potential to explode in your own wallet until you’re ready to sell.
Exchanges bring their own steep learning curve as you’ll need to get to grips with the technology involved and learn how to make sense of the data. Many exchanges also have limits on how much you can deposit, while accounts can be very expensive to maintain.
The indirect routes to investing in cryptocurrency with the potential to explode include ETFs that track a cryptocurrency, a crypto index, or a basket of cryptocurrencies selected by a fund manager. Additionally, one can trade or invest in stocks with an interest in cryptocurrency (crypto stocks and crypto ETFs) and blockchain technology (blockchain stocks and ETFs).
Things to consider when trading and investing in cryptocurrency
Before taking the plunge with any of these crypto projects, it’s crucial to arm yourself with some key knowledge that can help you pick winners and protect your portfolio from losses.
Your Budget: Determine how much you're willing to invest in cryptocurrencies. This should be an amount you can afford to lose without financial distress. Risk Tolerance: Crypto investments can offer incredible rewards but come with high risks. Understand your own level of risk tolerance to decide which types of coins suit your investment profile. Market Timing: Timing the market is often tricky. If you can afford to invest in crypto regularly and HODL until a bull market materializes, this will often be a better approach than hoping for quick gains. Asset Diversification: Don't put all your eggs in one basket. Consider diversifying your investments, both across different cryptos and different asset types, to balance risk and reward.
Summary - Will crypto explode in 2024?
In closing, this article has hopefully given you a better idea of the next big cryptocurrencies that could explode in 2024. However, the future performance of cryptocurrencies is uncertain and depends on various factors, including the recent regulatory uncertainty surrounding the crypto space, as well as the unstable economic climate characterized by high levels of inflation and rising interest rates.
While some investors are optimistic about the potential growth of the crypto market despite these challenges, others may be more cautious or skeptical. It’s important to note that the performance of cryptocurrencies is generally volatile and unpredictable and is often greatly impacted by external factors beyond the digital asset space. It is essential for anyone interested in this space to conduct thorough research and, if necessary, consult with a financial advisor before making any investment decisions.
Before you consider Ethereum or any other cryptocurrency with the potential to explode, you may want to see some of the best stocks to invest in for 2024.
Free resources
Before you start investing and trading cryptocurrencies with the potential to explode, you should consider using the educational resources we offer like CAPEX Academy or a demo trading account. CAPEX Academy has lots of free cryptocurrency trading courses for you to choose from, and they all tackle a different financial concept or process – like the basics of analyses – to help you become a better trader or make more informed investment decisions.
Our demo account is a suitable place for you to learn more about leveraged trading, and you’ll be able to get an intimate understanding of how CFDs work – as well as what it’s like to trade with leverage – before risking real capital. For this reason, a demo account with us is a great tool for stock investors who are looking to make a transition to leveraged trading.