Top Cryptocurrencies to Watch in February as Market Volatility Explodes

Following a tumultuous January in which most markets experienced major declines, we’ve picked some of the top cryptocurrencies that interest us this month.

January was a very painful month for the cryptocurrency market, with its total capital falling to $2.7 trillion and a loss of more than $350 billion.

At the time of this writing, panic has gripped the industry, with sentiment at its lowest level in months. Bitcoin price closed its fourth consecutive monthly candle in the red – something that hasn’t happened since the bear market in 2018.

But as the popular investment saying goes, it’s better to buy when there’s blood in the streets. Now, there’s no telling that the market will bounce and that the worst is behind us, but if you’ve been looking for a discount, well, it’s here.

That said, let’s take a look at the top cryptocurrencies to put on your February watch list.

Hyperliquid: The Price Is Actually Going Up… Going Up?

Hyperliquid is a decentralized exchange that allows users to trade infinite futures (and spot) of both cryptocurrencies and traditional assets. The latter is happening through the development of a protocol, better known as HIP-3 (HIP meaning Hyperliquid Improvement Proposal), which went live a few months ago, but seems to be growing at a rapid pace.

The exchange’s native cryptocurrency, HYPE, is up 25% for the month, while almost everything else is trading in the red. And if I say almost everything else, HYPE is one of the two top 20 coins with the highest market cap on the monthly chart.

It’s true that Hyperliquid has been exposed for a while, but the protocol seems to hold up well during times of great market turmoil. The price of HYPE is driven in part by continuous buying pressure on behalf of the protocol’s Support Fund, which automatically converts 99% of the costs generated by Hyperliquid into HYPE at prices from the open market. For reference, these funds did not fall below two million dollars per day in most cases during the last year, while, at the same time, they are parabolic during times of market volatility.

HYPE is one of the few systems that generate hundreds of millions in annual revenue, and many in the industry consider it a product that has achieved market equity.

Bitcoin: Time for a Resurgence?

As I mentioned earlier, the price of BTC is charting four consecutive negative candlesticks for the month closing – something we haven’t seen in almost eight years. That is the longest period in the crypto universe. Now, of course, past performance is never an indicator of future returns, but it’s something to think about.

Bitcoin price is currently trading below $80,000 – more than 40% from its all-time high.

But it is also true that the recent decline was not entirely isolated from crypto. The rally in precious metals such as gold and silver came to an abrupt halt, with gold down more than 20% and silver at a discount of more than 50% from their prices over the past few months.

That’s not typical of traditional commodities, even underlying gold, which has held up surprisingly well in terms of price performance. Many analysts expect gold prices to recover, inevitably dragging silver, driven by geopolitical tensions and economic power plays by the US, EU, China, and others. If that happens, perhaps the crypto markets will also see a rally in favor, where Bitcoin has a great chance to take center stage as the leading asset. This brings us to…

GOLD BACKED COINS

Cryptocurrencies such as PAX Gold (PAXG) and Tether Gold (XAUT) are digital representations of an ounce of gold and are backed by its physical equivalent. If the past few months have taught us anything, it’s that it’s a wild market for precious metals.

Analysts are not writing this meeting, and many believe that there will be a jump. After all, it’s not every week that we see a 20% drop in gold prices. Moreover, the international situation remains as uncertain as ever. The US is about to appoint a new Chairman of their Federal Reserve, their relationship with their biggest partner in the face of the EU is questionable, the war in Ukraine continues, there are tensions in the Middle East, and the fate of Greenland is still unknown following the talks in Davos.

While all of this should spell trouble for risky assets like stocks (and crypto), riskier assets (like gold) should improve. Those of you who don’t like off-ramping can look to gold-backed cryptocurrencies as an alternative.