Despite the recent struggles of the cryptocurrency sector, with its overall market capitalization on the edge of falling below $1 trillion, certain assets, including Solana (SOL) and Cardano (ADA), have managed to outperform others regarding risk-adjusted returns, emerging as top performers in the industry.
According to data published by crypto market analysis platform Kaiko on May 9, Solana and Cardano, two of the top altcoins by market cap, have achieved the highest year-to-date risk-adjusted returns for the period through May 3, as measured by the Sharpe ratio.
Kaiko posted on its Twitter page the details of both cryptocurrencies’ remarkable performances regarding the returns:
The Sharpe ratio measures the excess return of an asset per unit of volatility, with a ratio of 1 or above generally considered good.
— Kaiko (@KaikoData) May 10, 2023
Among the top altcoins, $SOL, $ADA, and $BNB have registered the highest year-to-date risk-adjusted returns pic.twitter.com/TljBSkjTci
The native cryptocurrencies Ripple (XRP), Polkadot (DOT), Polygon (MATIC), and the peer-to-peer cryptocurrency Litecoin (LTC) are among the coins with a Sharpe ratio above 1.
The meme-based digital assets Shiba Inu (SHIB) and Dogecoin (DOGE) have the lowest risk-adjusted returns among the top altcoins by market cap, with a Sharpe ratio below 1. The Kaiko study concluded that the weaker performance of the meme coins indicated that investors are taking on more risk relative to the compensation received.
In contrast, meme tokens like Dogecoin and Shiba Inu have been the worst performers, with a ratio below 1. This implies that meme coin investors are taking on more risk relative to the compensation received.”
In contrast, the price of Solana and Cardano has followed the same downward trajectory as Dogecoin and Shiba Inu over the previous week. During that period, SOL fell 7.75%, ADA 7.97%, DOGE 7.51%, and SHIB 11.41%.
Finbold had previously reported that Cardano’s DeFi apps had seen a significant transaction uptick. The Dapps On Cardano platform attributed this to introducing two new meme crypto assets, Snek and Pepeblue, to the network’s blockchain and metaverse.
