Down 30% or More for the Year, Are Any of These Top Cryptocurrencies Worth Buying Right Now?

XRP and its potential

It's been an interesting year for crypto, which has largely struggled despite the Trump administration's support for the sector and efforts to pass legislation that would remove regulatory roadblocks. In recent months, crypto has bounced back and recouped some of its losses, although many top cryptocurrencies are still in the red. Down 30% or more, are any of these top cryptocurrencies worth buying right now?

Despite its 30% drop this year, XRP (XRP +0.97%) remains the fifth-largest token by market cap at roughly $82.4 billion. One of the first major cryptocurrencies, XRP launched in 2012 and runs on a network that uses a smaller set of validators for transactions, allowing it to process more transactions per second (TPS). The network is believed to be capable of handling 1,500 TPS.

The founders who launched XRP also launched a company called Ripple, which has come a long way. Ripple leverages XRP's blockchain to bring faster payment capabilities to businesses, whether that's near-instant settlement or the ability to transfer fiat currencies to cryptocurrencies and stablecoins globally. Ripple also launched its own U.S. dollar stablecoin, RLUSD. Ripple is working with several large, well-known banks, including BBVA and Cross River Bank. The question becomes: How does XRP, the token, benefit from customers using Ripple and RLUSD?

One potential way is that increased network activity could drive up demand for XRP. It's certainly possible, but also hard to predict, like most things in crypto. Still, I believe the most important thing when investing in crypto is looking for tokens that operate on strong technical networks. I think XRP is worth a small, speculative position.

Dogecoin and market sentiment

Now the 11th largest token, Dogecoin has a market cap of roughly $13.5 billion. Dogecoin is also one of the oldest tokens, having launched at the end of 2013. It's down roughly 34% this year. Dogecoin was launched by a few software developers as a joke and used a Shiba Inu dog as its mascot. Money has value because people assign it value, and Dogecoin is proof of this.

The token was one of the first to really leverage the power of social media and went viral, with business celebrities like Elon Musk and Mark Cuban even allowing people to pay with the token for some goods at their various businesses. At the end of the day, though, Dogecoin doesn't run on a network with superior technical capabilities, so it doesn't really offer any differentiation beyond its ability to go viral. As long as crypto is around, I'm sure Dogecoin will be, too, but I don't recommend buying this token right now.

Shiba Inu and meme token competition

Dogecoin spawned a whole new industry of meme tokens, and the first one was actually a joke about Dogecoin. Given how viral Dogecoin had become, Shiba Inu simply capitalized on the popularity of its Shiba Inu mascot and launched its own token based on it. It did well for a while, but has now slipped to the 33rd-largest token, with a market cap of a little less than $3 billion. It's down about 31% this year.

Shiba Inu is an ERC-20 token, meaning it runs on Ethereum's blockchain. Interestingly, Shiba Inu created a Layer-2 blockchain solution called Shibarium, in which Shiba Inu transactions could be processed off Ethereum's network. The purpose was to speed up transaction times. Shibarium also incorporated a burning mechanism that could help decrease the token's enormous supply of 589.5 trillion tokens given enough time.

Still, overall, Shiba Inu doesn't really offer any superior technical advantage or unique use cases, and while the meme token fad isn't over, it's become much more competitive with thousands of cryptocurrencies now available. I would avoid the token right now.