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This month, it’s all about upgrades and potential developments.
Key points
- September will be the month of Ethereum’s long awaited Merge. Pay attention to related cryptos like Polygon and Ethereum Classic as well as the smart contract giant itself.
- Cosmos may see progress on its Rho upgrade in the coming months.
- Helium is trying to shake off a difficult few months with talk of a possible switch to Solana.
After nine months of falling or stagnating prices, investors keep hoping the crypto bear market will soon run its course. Sadly, inflation is still high and a recession could be in the cards. Plus, last week, Fed Chair Jerome Powell indicated that the central bank’s hawkish stance would likely continue. The market already took a hit following his speech. But be prepared for further volatility around the next potential rate hike announcement on Sept. 20-21.
In the meantime, there’s plenty of crypto development action going on behind the scenes. Low prices haven’t stopped many of these businesses from pursuing the transformational potential of the blockchain. Indeed, it’s always good to look for ongoing development activity and upgrades as it’s one indicator a project might be able to survive long term.
Here are three projects to keep on your radar in September.
1. Ethereum (ETH)
Given Ethereum’s size, it is hard to count it as an altcoin. However, its move from proof of work to proof of stake will dominate the crypto agenda. Not only is it the biggest crypto news this month, it’s arguably one of the biggest crypto events of the year. The long-anticipated Merge will take place in two steps, the first of which will be Sept. 6 and the second will follow shortly after.
As investors, be aware that any technical hitches could dent confidence in the whole industry, not just Ethereum. There’s also a lot of hype and speculation around the Merge, which could mean we see a short-term price drop for ETH as the Merge rolls out. If you keep your eyes on the long term, you’ll be less affected by any immediate frothiness.
Here are couple of other cryptos to watch with direct connections to Ethereum:
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- Polygon (MATIC): You’d think that upgrading Ethereum would be negative for layer 2 solutions like Polygon. After all, they exist to improve Ethereum’s performance, so if it gets better, won’t they become redundant? It’s unlikely. Firstly, the Merge won’t solve issues like high gas fees or network congestion. Secondly, even when Ethereum gets faster and lower-cost, layer 2s will still be able to improve its performance even more.
- Ethereum Classic (ETC): Also dubbed the “original” Ethereum, Ethereum Classic was formed after a disagreement split the community over five years ago. It won’t move to proof of stake. That makes it attractive for many Ethereum miners whose equipment is about to become redundant.
2. Cosmos (ATOM)
Cosmos attracted a lot of attention in August after investment manager VanEck said it was bullish about ATOM long term. That hype may have passed, but we’re watching out in September and hoping for progress on its long-awaited Rho upgrade. Originally due in the second quarter of this year, there’s no set date, but when it happens it will bring improved governance and other features.
Cosmos is an interoperability crypto, which means it helps blockchains to communicate with one another. This is a big deal for the industry, and one of several reasons VanEck is optimistic about its future. It’s available from most top cryptocurrency exchanges.
3. Helium (HNT)
Helium has had a rough time recently. The decentralized network that pays HNT to operators that run its long range wifi routers first came under fire for misrepresenting its partnerships. Then people raised questions about its utility, citing low monthly revenue figures.
Helium hit back at critics, stressing the various use cases for the project and setting out the potential market share. CEO and founder Amir Haleem explained that low revenue figures in the media are not representative of the network’s total revenue.
Fast forward to today, and Helium is considering a move to the Solana (SOL) network. The community will be able to vote on the proposal, which would simplify the blockchain architecture and make it more scalable, in mid September. There’s also a big “HeliumHouse” gathering in New York on Sept. 20.
Bottom line
There’s still a lot of uncertainty in the cryptocurrency markets and sadly, prices could fall further. Don’t jump and buy the cryptos above in the hope of short-term gains. Instead, do your own research and consider how you think they might perform in the long term and how they might fit into your wider portfolio. As with any high-risk investment, only spend money you can afford to lose.
Cosmos and Helium are both interesting crypto projects with a lot to offer. However, all crypto investments carry risks and these ones are no different. Cosmos has a nasty habit of delaying upgrades — the Rho one is already late — and some critics say Helium’s business doesn’t need a blockchain at all. It’s also important not to get too tied up in the hype around Ethereum. The Merge is a big deal, but it’s only a step in a bigger journey. The next important move will be to actually reduce gas fees and improve scalability, and that upgrade isn’t due until at least next year.