Overall, the Layer 2 blockchain protocols have grown tremendously in the last few months. Accordingly, many tokens that are connected to the respective networks do extremely well in 2021. However, Ethereum-compatible Layer 1 chains like Cosmos, Tezos and Polkadot are slowly shining and gaining attention.

The above altcoins have also brought pretty solid returns to HODLers over the past month. The ATOM price rose more than 122.5% in 30 days. Over the same period, XTZ and DOT are up 104.7% and 59%, respectively.

Which Altcoin is the Better Option?

To answer this question, it is necessary to consider the state of several metrics. At the time of writing, the stock-to-flow ratios reflect the respective values ​​of 10.01 (DOT), 13.76 (XTZ) and 16.33 (ATOM). The S2F model quantifies the scarcity of a particular asset taking into account parameters such as total supply and annual yield.

Higher value means that less supply comes onto the market and becomes scarcer. This will eventually help the price of the asset to go up. Given the above results, ATOM is clearly leading the race and is followed by XTZ and DOT respectively.

XTZ ads | The source: Messari

Looking at risk-adjusted returns, ATOM is again at the top, followed by XTZ, DOT. Additionally, it should be noted that the Sharpe ratios of the above coins at the time of writing are 5.6, 4.6 and 3.9, respectively.

Sharpe – DOT Ratio | The source: Messari

In addition, the average 30-day volatility of all three altcoins stays below 2, which creates a favorable environment for sustainable growth. A very volatile market often opens the door to strong price action in either direction, but moderate levels are often more likely to drive an uptrend than a bear.

In addition, the development work in the respective networks has been quite impressive so far. Working speed on GitHub in general too pretty good for these altcoins.

Development activities | The source: mood

In short, all three will add a lot of value to the portfolio if held over the long term. In the case of short-term interest, however, based on the state of the indicators, ATOM seems to be the better choice.

Can it continue to rise?

Aside from some immediate resistance around $ 30 and $ 31, ATOM does not appear to be holding any other hurdles. The volume has risen and is also trading above the moving averages. If buying pressure continues to mount, traders can expect the altcoin to break the May highs in the next trading sessions. Otherwise the price will fluctuate around the $ 27 threshold again.

Indeed, the famous analyst Michael van de Poppe claimed the same thing all in one Video recently:

“If I had to choose a coin that followed SOL and had to be a Layer 1 solution, it would be XTZ, DOT, or ATOM. With their current structure, they look great. “

Source: Michael van de Poppe

Trading at $ 7.48 and $ 35.9 at press time, the XTZ and DOT appear not far from their May highs of $ 8.4 and $ 49.7, respectively.

XTZ price table | The source: TradingView

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Minh Anh

According to AMBCrypto

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