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After cratering in 2022 as a result of rapidly rising interest rates and a risk-off sentiment from investors, the cryptocurrency market has bounced back this year. And this might draw renewed interest in the space.

Dogecoin, the eighth-most-valuable digital asset, surprisingly hasn't benefited from the broader market's rally. Its price is down 7% in 2023 (as of June 22). A reversal of this downtrend may be in the cards.

But if you're looking at buying Dogecoin for your portfolio in hopes of capturing huge gains, think again. I believe it's a much better idea to use that money to buy Bitcoin instead. Here's why this is a no-brainer decision.

In 2013, programmers Billy Markus and Jackson Palmer wanted to create a lighthearted and fun version of Bitcoin, so they launched Dogecoin. That was really the only purpose behind the dog-inspired meme token. Although its price is down 91% from its peak, Dogecoin has skyrocketed over 2,400% in the last five years, so it has probably made some investors extremely wealthy.

But Dogecoinwas invented with no real-world utility in mind. And even after being in existence for a decade, it still hasn't found much in the way of mass adoption. According to cryptwerk.com, only 2,167merchants worldwide accept payment in Dogecoin.

Moreover, it's clear that this token's price moves up and down based on various hype cycles. Two years ago, the Reddit-fueled craze that helped the share prices of GameStopand AMC Entertainmentalso trickled over to the crypto market. And tweets by Teslafounder and CEO Elon Musk can pump up the price in short order.

You can't time this kind of social media-powered activity, and trying to do so is not a good investment thesis.

As the world's first and largest cryptocurrency, Bitcoin's current market cap of $585 billion crushes that of any other digital asset. And this gives it critical network effects that the smaller Dogecoin can't compete with. In fact, Bitcoin's more-than-14-year existence proves that it can handle anything thrown its way, from major crypto firms blowing up to significant volatility. It's still here, and its price has soared 81% this year alone.

While some investors and economists might view Bitcoin as a potential global reserve currency in the future, its most promising investment trait right now centers on it becoming more popular as a store of value. Throughout history, gold has been thought of as the best store of value. But Bitcoin has properties that make it superior to the precious metal.

Bitcoin is easier to transport across vast distances, and it's easier to transact with. This is obvious because it's digital. Bitcoin can also be divided by up to eight decimal places. And most importantly, the supply of Bitcoin is absolutely finite, with a hard cap of 21 million coins built into the bitcoin network's source code.

While gold is valued for its use in jewelry and certain industrial and medical applications, gold's largest advantage, in my opinion, is that it has been used in some form as money or a store of value for thousands of years. Bitcoin can't compete with this lengthy history, but the digital asset should attract more interest from younger and more tech-savvy investors.

A huge dark cloud over the overall crypto industry is the threat of a regulatory crackdown. The Securities and Exchange Commission recently filed lawsuits against Binance and Coinbasefor operating unregistered brokerages and exchanges. But while this adds a huge element of uncertainty, there is an encouraging development for Bitcoin in particular.

According to Reuters, the massive asset manager BlackRock has filed to launch a Bitcoin-focused exchange-traded fund (ETF). This is a clear indicator that a huge player in financial markets sees the opportunity to get aggressive as two crypto exchanges are under heat.

And this could prove to be a huge boon for Bitcoin's long-term adoption. If BlackRock gets approved for this ETF, it could open the floodgates for both retail and institutional investors to gain easy access to Bitcoin. A growing base of buyers will only push up the demand for this fixed-supply asset.

Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Coinbase Global, and Tesla. The Motley Fool has a disclosure policy.

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Thinking About Buying Dogecoin? Buy Bitcoin Instead - The Motley Fool

According to on-chain analytics firm Santiment, Bitcoin cash has been the biggest beneficiary since a new crypto exchange backed by firms including Citadel Securities, Fidelity Digital Assets, and Charles Schwab Corp. EDX Markets went live.

Bitcoin Cash (BCH) has surged by nearly 79% in the past four days after EDX listed the token alongside Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC).

"With the assistance of EDXMarkets, launched on June 20, Bitcoin Cash has been the biggest beneficiary, with a massive +79% price gain in 4 days. Notably, BCH has seen a 3-year high in social discussion rates, and volume has easily eclipsed 2023 highs," Santiment wrote.

While social dominance has reached its highest point since 2020, Santiment notes that BCH volume is robust, hitting 2023 highs.

After hitting intraday highs above $200, not seen since May 2022, BCH was up 35.76% in the last 24 hours at $193 at the time of writing.

In the past seven days, BCH has been up more than 80%, according to CoinMarketCap data. BCH has thus reentered the top 20 with a current market capitalization of $3.75 billion.

As traders rushed into the current market spike to profit, BCH's 24-hour trading volume also increased by over 425%.

The rest of the market received a spark of positivity after Bitcoin hit its highest level in a year following high-profile exchange-traded fund (ETF) filings in the U.S. of late. A few often dormant altcoins are soaring as a result of the market's increased optimism. Notably, Bitcoin and Ethereum forks are soaring.

Bitcoin SV is up 24% in the last 24 hours. Ethereum Classic (ETC) is up 13%, as is EthereumPoW (ETHW), which is up 20% in the last 24 hours.

Bitcoin Cash's upcoming halving in the next 286 days remains another positive catalyst.

The subsequent Bitcoin Cash halving is expected to occur on or around April 6, 2024, according to OKLink. After that, rewards for mining Bitcoin Cash will decrease from 6.25 BCH to 3.125 BCH. There are currently 41,297 blocks remaining for this event.

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Bitcoin Cash (BCH) Up 79% in Days; Here Are Possible Reasons for ... - U.Today

Bitcoin hit its highest level in a year amid renewed fervor for digital assets despite a slew of challenges for the industry. The original digital currency crossed above $31,013, its 2023 peak, to reach its highest level since June 2022, Bloomberg data show. The surge brought Bitcoin to as high as $31,410 before the gain was pared. The token is up by almost 90% since the start of the year, though still more than 50% below an all-time high of almost $69,000. Other cryptocurrencies followed suit, with Ether also rallying. Its a remarkable development and show of resiliency for a market that many had written off as being on the verge of extinction following a number of high-profile and high-impact scams and company fallouts that left the industry besmirched among investors. From the ardent Bitcoiners perspective, the tokens most fundamental investment thesis is playing out: inflation, monetary mismanagement, banking crises, sovereign debt anxiety, US-dollar-reserve-status questions are all playing a role in giving Bitcoiners an I told you so moment, said Strahinja Savic, head of data and analytics at FRNT Financial. I would not describe rallying to new all time highs despite the challenging environment, but rather because of it. Most recently, its been news about BlackRock Inc s shock filing for a US spot Bitcoin exchange-traded fund thats reignited fervor for crypto, with some in the market hoping that such a product which currently doesnt exist gets approval from regulators. An approval whatever its odds would mark a win for fans who have for years longed for such an investment product. BlackRocks filing is big news for Bitcoin due to its close ties with regulators and a very strong ETF-approval track record, wrote K33s Bendik Schei and Vetle Lunde. Its also worth noting that BlackRock would not dedicate time and resources to this filing if they did not view the probability of long-term strength from BTC, and thus strong inflows, as substantially high. They added: An approval would profoundly impact the market structure of Bitcoin, as it would reduce the barriers for financial advisors to offer exposure to BTC through an accessible investment vehicle with daily creations and redemptions delivered by a trusted issuer. Other recent news also reinforced crypto believers faith in the rally. A new crypto exchange backed by firms including Citadel Securities, Fidelity Digital Assets and Charles Schwab Corp. called EDX Markets said its gone live. And, among other pieces of news, JPMorgan Chase & Co expanded one of the most high-profile projects to bring blockchain technology to traditional banking, introducing euro-denominated payments for corporate clients using its JPM Coin. The effects of the so-called crypto winter seem less persistent today than a year ago, as various jurisdictions and institutional players continue to embrace crypto-related initiatives, David Duong, head of research at Coinbase, said in a recent note. On Twitter, where a lot of crypto discourse takes place, a number of users cited FOMO or the fear of missing out as part of the recent price surge, whereby some investors jump into the market because they are watching others reap the benefits of the rally and want to take part in it. But the fact that the industry is facing harsh regulatory oversight has not dissipated, despite all the renewed hype over prices surging. The SEC has set its sights on the crypto space following last years numerous instances of scams and fallouts of once-vaunted companies, including FTX and a number of lenders. Its led to a mass exodus by retail investors in particular, who have collectively lost billions of dollars in the wake of the revelations and implosions. Trading volumes have dried up as a result. In May, the combined spot and derivatives trading volumes on centralized exchanges fell more than 15% to $2.4 trillion, according to CCData. Spot trading volumes alone dropped nearly 22% to $495 billion, notching the lowest monthly reading since March 2019, the researcher said in a report. Given the thin liquidity and the relatively scant amount of BTC available to new entrants (no eager sellers at these levels), even a tiny uptick in large investor interest would be enough to move the price, said Noelle Acheson, author of the Crypto Is Macro Now newsletter. Others point out that hype around a potential spot-Bitcoin ETF has come and gone in the past, without regulators ever approving such a product. People are speculating BlackRocks heft in the financial markets will help them get approval. I am not quite there yet, said Michael ORourke, chief market strategist at JonesTrading. The SEC has been aggressively cracking down on the crypto space, it seems a bit early for such an about-face.

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Bitcoin hits highest in a year as crypto rebounds from scandals - Times of India

Bitcoin boosters like to claim Bitcoin, and other cryptocurrencies, are becoming mainstream. Theres a good reason to want people to believe this.

The only way the average punter will profit from crypto is to sell it for more than they bought it. So its important to talk up the prospects to build a fear of missing out.

There are loose claims that a large proportion of the population generally in the range of 10% to 20% now hold crypto. Sometimes these numbers are based on counting crypto wallets, or on surveying wealthy people.

But the hard data on Bitcoin use shows it is rarely bought for the purpose it ostensibly exists: to buy things.

The whole point of Bitcoin, as its creator Satoshi Nakamoto stated in the opening sentence of the 2008 white paper outlining the concept, was that:

A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.

The latest data demolishing this idea comes from Australias central bank.

Every three years the Reserve Bank of Australia surveys a representative sample of 1,000 adults about how they pay for things. As the following graph shows, cryptocurrency is making almost no impression as a payments instrument, being used by no more than 2% of adults.

Payment methods being used by Australians

By contrast more recent innovations, such as buy now, pay later services and PayID, are being used by around a third of consumers.

These findings confirm 2022 data from the US Federal Reserve, showing just 2% of the adult US population made a payment using a cryptocurrrency, and Swedens Riksbank, showing less than 1% of Swedes made payments using crypto.

One reason for this, and why prices for goods and services are virtually never expressed in crypto, is that most fluctuate wildly in value. A shop or cafe with price labels or a blackboard list of their prices set in Bitcoin could be having to change them every hour.

The following graph from the Bank of International Settlements shows changes in the exchange rate of ten major cryptocurrencies against the US dollar, compared with the Euro and Japans Yen, over the past five years. Such volatility negates cryptocurrencys value as a currency.

Cryptocurrencys volatile ways

There have been attempts to solve this problem with so-called stablecoins. These promise to maintain steady value (usually against the US dollar).

But the spectacular collapse of one of these ventures, Terra, once one of the largest cryptocurrencies, showed the vulnerability of their mechanisms. Even a company with the enormous resources of Facebook owner Meta has given up on its stablecoin venture, Libra/Diem.

This helps explain the failed experiments with making Bitcoin legal tender in the two countries that have tried it: El Salvador and the Central African Republic. The Central African Republic has already revoked Bitcoins status. In El Salvador only a fifth of firms accept Bitcoin, despite the law saying they must, and only 5% of sales are paid in it.

Read more: One year on, El Salvador's Bitcoin experiment has proven a spectacular failure

If Bitcoins isnt used for payments, what use does it have?

The major attraction one endorsed by mainstream financial publications is as a store of value, particularly in times of inflation, because Bitcoin has a hard cap on the number of coins that will ever be mined.

As Forbes writers argued a few weeks ago:

In terms of quantity, there are only 21 million Bitcoins released as specified by the ASCII computer file. Therefore, because of an increase in demand, the value will rise which might keep up with the market and prevent inflation in the long run.

The only problem with this argument is recent history. Over the course of 2022 the purchasing power of major currencies (US, the euro and the pound) dropped by about 7-10%. The purchasing power of a Bitcoin dropped by about 65%.

Bitcoins price has always been volatile, and always will be. If its price were to stabilise somehow, those holding it as a speculative punt would soon sell it, which would drive down the price.

But most people buying Bitcoin essentially as a speculative token, hoping its price will go up, are likely to be disappointed. A BIS study has found the majority of Bitcoin buyers globally between August 2015 and December 2022 have made losses.

The market value of all cryptocurrencies peaked at US$3 trillion in November 2021. It is now about US$1 trillion.

Bitcoinss highest price in 2021 was about US$60,000; in 2022 US$40,000 and so far in 2023 only US$30,000. Google searches show that public interest in Bitcoin also peaked in 2021. In the US, the proportion of adults with internet access holding cryptocurrencies fell from 11% in 2021 to 8% in 2022.

Read more: What is Bitcoin's fundamental value? That's a good question

UK government research published in 2022 found that 52% of British crypto holders owned it as a fun investment, which sounds like a euphemism for gambling. Another 8% explicitly said it was for gambling.

The UK parliaments Treasury Committee, a group of MPs who examine economics and financial issues, has strongly recommended regulating cryptocurrency as form of gambling rather than as a financial product. They argue that continuing to treat unbacked crypto assets as a financial service will create a halo effect that leads consumers to believe that this activity is safer than it is, or protected when it is not.

Read more: Crypto trading: politicians who say it should be treated like gambling are completely wrong

Whatever the merits of this proposal, the UK committtees underlying point is solid. Buying crypto does have more in common with gambling than investing. Proceed at your own risk, and and dont invest what you cant afford to lose.

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Almost no one uses Bitcoin as currency, new data proves. It's ... - The Conversation

The International Monetary Fund (IMF) is changing its tune on cryptocurrency. After suggesting other countries consider banning crypto, the agency now thinks that might be the wrong move.

On Thursday, IMF economists released a report examining cryptocurrency usage across Latin America and the Caribbean. Acceptance has varied in the region with some countries, like El Salvador, being more open to adoption versus others that are more wary over the perceived risks involved. In their report, the economists leaned into a position closer to adopting cryptocurrencies, but within a well-regulated framework.

"While a few countries have completely banned crypto assets given their risks, this approach may not be effective in the long run," the economists said in the report's conclusion.

This is a swift change from the IMF, which just months earlier said in another report that countries should consider banning cryptocurrencies. That view was held by a handful of directors on its board, but the consensus even then leaned towards better regulations over a ban.

In yesterdays report, IMF economists said that cryptocurrency offered a number of benefits to its adopters. They wrote that crypto offered protection against macroeconomic uncertainty, promoted financial inclusion, and faster payments among other benefits.

They also offered an analysis of recent efforts in Latin America to develop central bank digital currencies (CBDCs).

In a survey shared with officials across the region, the IMF found that half of the respondents said they were considering both retail and institutional CBDC options. What they also saw in CBDCs was a way to promote resilience in communities vulnerable to natural disasters, and create a way to boost financial inclusions in more remote ones.

Most Latin American countries are still in the research stage for CBDCs, the IMF wrote, but others have progressed to the experimental stage. The largest is Brazil, the region's economic powerhouse. Its been examining a CBDC since 2020 and has plans to launch one in 2024.

The IMF also pointed out difficulties in integrating cryptocurrencies into their economies.

In Argentina, the central bank clamped down on crypto in May by banning payment platforms from offering it to customers in the country. Even in El Salvador, which granted legal tender to Bitcoin as a way to settle transactions, the IMF found that it was struggling to become more widely used.

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IMF Capitulates on Bitcoin Bans, Says They're Not Effective - Decrypt