01 Nov Four cryptocurrencies with a Weiss “buy” rating
Yesterday, we looked at 4 cryptocurrencies to avoid and why. Today, we’re looking at four cryptocurrencies with a “buy” rating from Weiss Cryptocurrency Ratings and why they merit a second look.
Weiss maintains databases on more than 3,000 cryptocurrencies and tokens and actively grades more than 100 of these digital currencies, giving each an investment grade from “A” to “E.”
How are cryptocurrencies graded?
Analysts look at four key criteria including underlying blockchain technology and performance; adoption, including investors, community and users; investment risk, including volatility and downside price risk; and potential for investment reward.
Any digital currency with a grade higher than “B-” is considered a “buy” rating, while those below “D+” are a suggested “sell.”
Weiss explains that no cryptocurrencies currently receive an “A” rating because the technology is at its early stages and is volatile and risky.
Four coins with a buy rating
A recent newsletter highlights four cryptocurrencies Weiss says have buy potential. They include XRP, Stellar, EOS and Cardano.
“XRP and Stellar are appealing to businesses and other organizations, mainly for speedy financial transfers. In contrast, EOS and Cardano are designed more as virtual communities, with each participant empowered to influence the future direction of the project, spanning a broad range of applications,” analyst Juan Villaverde says.
Let’s look at Weiss’s analysis and why its research team is positive on these four digital assets.
Ripple (XRP) gets a positive grade because it has reasonable trading volume, lower than average volatility, solid technology, and numerous projects and partnerships as it works towards becoming the blockchain platform of choice by financial institutions. It’s not a slam dunk success by a long shot and it does have some long-term challenges, according to Villaverde. Ripple is a private company and it has an open-ended ability to issue new Ripple tokens which raise concerns with investors.
EOS ranks positively with a B for its technology, which can handle tens of thousands of transactions per second compared with Ethereum’s 20 transactions per second. It usually ranks in the top seven cryptocurrencies for trading volume, according to Blockcoin Today’s market cap data. EOS has an active developer community and is proving to be a popular platform for many new DApps.
Cardano (ADA) also gets a positive grade for its decentralized blockchain technology. Released in 2017, Cardano has an active developer community and usually trades in the top 10 volume of cryptocurrencies. It has a current market capitalization of $1.84 billion. Its key advantages are its scalability, its proposed interoperability, and its active user and developer community.
Stellar (XLM) is seen as another buy possibility by Weiss. Stellar has a $4.24 billion market cap with a generally positive volume of daily trading. Based originally on Ripple, its payments technology is considered solid, although its user community is somewhat smaller than the other three coins. Stellar is aimed at developing markets instead of banking systems and its network is used by IBM for transactions in the South Pacific.
All in all, these four cryptocurrencies are positively rated by Weiss Cryptocurrency Ratings. The modest “buy” ratings reflect the early stage development of blockchain and cryptocurrency, but the Weiss analysis is helpful in grading cryptocurrencies and forecasting what’s on the horizon as the technology develops.
Note from the Editor: Editorial content should not be interpreted as investment advice. Cryptocurrencies are extremely volatile. We recommend investors do their own research and seek the counsel of trusted investment, tax, legal and other expert advisors before making any investments.