Bitcoin, the most popular digital coin and largest by market cap, was priced around $6,400 on Friday — a staggering decline from its December highs of around $19,500.
But cryptocurrency is still a relatively new industry, and while all eyes are on bitcoin, Kelly, founder and CEO of BKCM LLC, an investment firm focused on digital currencies, said there are other digital coins that investors might want to consider.
"Just remember," Kelly said on "Fast Money" Friday. "Myspace existed well before Facebook. Tech disrupts itself. So, just because you have bitcoin today doesn't mean in 10 or 15 years bitcoin is going to be the leader."
In fact, he said the next big thing in crypto might be ethereum, a decentralized blockchain platform.
"Relative value-wise, ethereum has been trading a little bit better than bitcoin," Kelly said. "I would overweight ethereum at this point."
Kelly pointed out that after the U.S. Securities and Exchange Commission determined that ethereum was not a security, the president of Cboe Global Markets said that was also a hurdle for launching ethereum futures.
"So one would think, perhaps, ethereum futures are not far off," he said. "They already have an ethereum index."
The augur platform, one of the oldest ICOs, has been in development for about two or three years, Kelly said.
"It's a decentralized prediction market," he said. "What's interesting about this [is that] this will probably be one of the biggest decentralized apps on top of ethereum."
"If [augur] doesn't slow the system down, that can generally be a positive for ethereum," Kelly said.
Kelly said ethereum is upgrading.
"They [will] go from hardware mining, proof of work, to something called 'proof of stake,' which is similar to a software mining," he said.
He said in the next couple of months this will start to take effect and have an impact on ethereum.