What is Blue Chip Crypto: Is It Safe?

Introduction

What is blue chip crypto? Have you heard about this term in the crypto industry? If not, don’t worry; this post will get you all the info.

Investors instantly seek refuge in safe-haven assets with underlying solid value if prices start to fall on the financial markets. Or, to put it another way, they look for blue chips.

The market for cryptocurrencies is comparable in this regard. During cryptocurrency bear markets, investors frequently turn to blue chip cryptocurrencies like Bitcoin and Ethereum.

It is because they have been around longer, have good reputations, and are more reliable than other cryptocurrency and blockchain coins.

What is Blue Chip Crypto?

Blue chip cryptos are well-established digital assets with substantial market capitalizations, institutional standing, solid reputations, increased liquidity, and reduced volatility.

The poker game is where the phrase “blue chip” first appeared. Red, white, and blue poker chips were frequently traded when the game of poker dominated the frontier in the 19th-century USA. The value of the blue chips was always the highest.

The 1920s are said to be when the phrase was first used to refer to stocks. A Dow Jones employee reportedly came up with the words after observing that some equities were trading substantially higher than others.

The term “blue chip” evolved during the century to mean much more than merely expensive stocks. It now refers to shares of stock issued by well-known, financially secure businesses with a solid track record of withstanding adversity.

The definition of “blue chip” in the context of cryptocurrency is essentially unchanged. Bitcoin and Ethereum, two “blue chip” coins, have made a name for themselves as institutions in the blockchain/crypto sector.

The first cryptocurrency, and undoubtedly the most well-known, is bitcoin. Even though it occasionally experiences volatility, since its creation in 2008, it has continuously managed to see its value rise.

The value and popularity of Ethereum have both increased dramatically. Its reputation as a Defi pioneer and the leading platform for non-fungible tokens (NFTs) is unafraid to remain for the foreseeable future.

Blue chip cryptocurrencies like Bitcoin and Ethereum haven’t precisely endured the test of time like their stock relatives because of their comparatively recent appearance. However, they have survived downturns and bear markets, and the general public views them as financially stable.

What Makes a Blue Chip Crypto?

Blue chip coins can be distinguished from the myriad of altcoin choices currently offered to traders and investors who are less risk-averse by several features. Some of these factors are:

1. Long-Standing Operation
2. Founder’s Reputation
3. Institutional Status
4. Large Market Cap
5. Higher Liquidity
6. Lower Volatility

Why is BTC a Blue Chip Crypto?

All of the criteria above are met by Bitcoin, making it the top blue chip cryptocurrency. It is a haven for those seeking more muscular long-term gain and less volatility. 

Since it was the first cryptocurrency ever created and has endured the longest of all cryptocurrencies, Bitcoin unquestionably qualifies as a premium asset.

It should not be surprising that Bitcoin has the highest market cap of any cryptocurrency, given its extensive history. BTC is such a dominant force in the cryptocurrency market that the price movements of both blue chip and non-blue chip coins frequently follow its lead.

Investors and traders in Bitcoin benefit from a first-mover advantage, unlike with other cryptocurrencies and “blue chip” coins. Additionally, they gain from Bitcoin’s rarity. Only 21 million Bitcoins will ever be produced. Hence, the price of BTC keeps rising, and the cryptocurrency is proving to be a rock-solid blue chip investment.

Why is ETH a Blue Chip Crypto?

Although it ranks first in terms of usage, Ethereum (ETH), the second-largest cryptocurrency by market cap, is a significant player in the crypto industry. 

Over 70% of all accessible altcoins are supported by its powerful, ground-breaking platform. It also hosts the most decentralized apps (DApps).

ETH controls 20% of the entire cryptocurrency market. However, it keeps improving and evolving, making it a crucial part of cryptocurrency.

Etherium is unquestionably one of the top blue chip cryptocurrencies worth investing in practically any time.

But, especially during times of crisis when concerns for safety and security take precedence over the desire for spectacular short-term gains.

Conclusion

If you’ve been a long-time supporter of crypto and Defi, it’s lovely to hear phrases like “blue chip” being used to describe them. 

We frequently hear about safe equities that provide predictable returns, but we are just now beginning to observe this mindset toward the cryptocurrency space. 

Investors now have a safe place to store their money thanks to the rise of reputable cryptocurrencies like Bitcoin and Ethereum, which have the uncommon ability to offer both protection and the possibility for profit.