The world of cryptocurrency is constantly changing, meaning that what was once a top altcoin may not be in 2022. This article will highlight the top 5 potential candidates for being at the top of the list in the coming year.
First, let us understand the definition of altcoin and how to invest in cryptos. Bitcoin was the first crypto token and all the other tokens/coins were considered altcoins. This post is not financial advice and would recommend you to do your research before investing in the altcoins suggested in this post. I personally dollar cost average in the altcoins suggested using voyager and blockfi accounts. I use these accounts as I gain interest in the coins and fiat money invested.
Before we get into the actual altcoins, I want to share why I invest in what I invest. During the California Goldrush (1848-1855), a lot of people had migrated to dig gold but many returned empty. However, there were a few who took care of the needs of gold seekers by supplying the tools needed. The selected few were very successful and made a lot of money. The point I am trying to make is that it is a smart idea to invest in the infrastructure needed for a service rather than the service itself. For example, we tend to invest in EV Vehicles such as $TSLA ( exception as they are also in battery business), $LCID but we will be more profitable if we invest in the infrastructure needed for EV vehicles such as charging stations, batteries, etc.
Here are the coins I will continue to dollar cost average in 2022.
Bitcoin is the original and most well-known cryptocurrency. It is still the largest and most valuable coin in terms of market cap. While it may not be the top coin in 2022, it will continue to be the first coin that would be invested to gain exposure to cryptos.
Ethereum was created to be a platform for decentralized applications. It has been one of the most successful altcoins to date and is likely to remain a top player in the coming years. Most of the decentralized applications are on this platform to date. However, Ethereum is facing some stiff challenges with higher gas fees and transaction times and developers are working on a version to minimize the challenges faced today. After the advent of Ethereum, many alternative platforms have risen taking care of the fees and transaction times and at the same time interoperable with Ethereum platform. Also, level 2 platforms such as polygon got market share because of the slow transaction times on Ethereum platform. I truly feel that multiple platforms will coexist in the future and the apps created can be easily deployed into these platforms in a standardized way.
Solana is a serious contender for Ethereum and is incredibly fast (up to 50000 transactions per second compared to Bitcoin 7 transactions per second and Ethereurm 30 transactions per second). It is possible because of their patented proof of history mechanism along with proof of staking. It is a little bit expensive to set the infrastructure for validating nodes to acquire the speeds we are talking about. It is currently live and a lot of NFTs and DeFi are launched on Solana (Melania Trump had started an NFT project on Solana). Solana network had some issues and was shut down a few times this year. This platform is built by ex-Qualcomm engineers who were responsible for 4G, 5G, and CDMA. I truly believe that they understand what it takes to build efficient and fast communication networks and would resolve issues faced quickly. This coin has risen considerably this year and I see further upside in 2022.
Cardano is another platform for decentralized applications and was considered an Ethereum killer. Their Altcoin goes by $ADA. They were in the top 5 coins as per market capitalization but have been displaced by Solana recently.
There is so much FUD (fear, uncertainty, and doubt) in Cardano community due to the lack of development. Cardano is lagging in Smart contracts development and is way behind Ethereum. One of the reasons cited for the slow development is because the features are implemented and pushed based on peer reviews and it takes considerable time.
Why am I investing in this coin?
With 53 billion market cap, it is still relatively cheap compared to other platforms. Expect this to go to at least 5 in 2022.
It is started by the co-founder of Ethereum network- Charles Hoskinson, who is well respected in the community, has a great social presence, truly believes in what he is building, and is good at forging long-lasting relationships with companies.
The peer-to-peer framework has its challenges but creates a bug-free platform. In November, Cardano introduced Test Net that can be used by developers to test their applications before pushing live on to the main net.
Recently, they have entered into a partnership with Flexa Network. $ADA can be used in 40000 US Stores along with $BTC, $ETH, and $GUSD through flexa network
I invest only what I can afford to lose.
Polkadot (DOT), Cosmos (ATOM), Avalanche (AVAX)
Cosmos, Polkadot, and AVAX are designed with the same end purpose - interoperability of blockchains with their technical implementations different.
I truly believe these platforms will play a major role as the number of DeFi applications and NFTs deployment increases and there is a need for these apps to be deployed in various platforms for NFR (non-functional requirements) such as scalability, reliability, and availability
Learn the differences between these platforms here
Terra Luna is ninth in terms of market capitalization (2 Trillion) and is a blockchain protocol that uses flat pegged stable coins to power price-stable global payment systems. Terra is all about interoperability and is currently live on Ethereum and Solana. It has plans to expand on other top performing blockchain platforms in the future
So, how does it work? Terra utilizes a programmable infrastructure to provide the market with self-stabilizing stablecoins and other unique features. To accomplish this task, the network relies on an elastic monetary supply mechanism. The platform automatically adjusts the supply of its stablecoins to ensure that their values remained pegged to their underlying assets.
Terra currently supports Anchor protocol for lending purposes and Mirror protocol for trading synthetics. Staking awards are also provided for these protocols
Why am I investing? LUNA is the token that is burnt to provide stability of prices for quick settlements. As more LUNA is burnt, the price of this token increases. I truly believe that fiat currencies will be replaced by stablecoins in the future for all digital transactions and Terra is positioned well for this transition.
Get more information about Terra here.
Chainlink addresses the issue of communicating information required to and from the blockchain.
Today, outside information is communicated to the blockchain through sensors called oracles. There are oracles for all kinds of information available today - weather, sports, finance, etc. Oracles allow the blockchains to execute the smart contracts based on the outside information (if certain parameters are set). Oracles are centralized in nature and the whole blockchain dependent on these oracles for information can be compromised if the oracles are either corrupted or not available.
Chainlink addresses the issue by creating the first oracle blockchain network. It uses the same underlying technologies as other traditional blockchains to ensure that nodes are functioning properly and data is accurate.
It is a no-brainer to invest in this infrastructure play that is needed by blockchain networks executing smart contracts. These smart contracts can be customized to consider outside parameters for their execution consistently and reliably. For example, DEXs utilize oracles to determine the price of cryptocurrencies without offering an order book.
Learn more about chainlink here
Enjin is an online PaaS (Platform as a service) platform that allows users to integrate various blockchain technologies without writing a single line of blockchain code. In short, it enables a developer/user to leverage blockchain infrastructure without writing code. Enjin has been around since 2017 but has caught attention only in 2021 when they shifted their attention to the gaming sector especially NFTs.
Enjin allows users to create and manage their own NFTs. Enjin has also integrated with many other metaverses and will likely continue to bond with new ones that will emerge in 2022, creating a complex and rich network that will allow NFT makers and collectors to switch their digital collectibles from one metaverse to another. This will also include game items, monsters like the ones that Axie Infinity offers, and even art pieces.
I truly believe this is an exciting business to be and will be used by most of the crypto-based games like Sandbox, Decentraland, etc. For example, Every game would need digital collectibles and they need to integrate with Enjin to retrieve digital collectibles available as NFTs to use as avatars for their players.
Learn more about Enjin here
In addition to these coins, I personally like Binance (BNB), ENS (Ethereum Naming Service), Yearn. Finance (YFI) and might invest in these coins in 2022 I also love DRIP (Drip network) for their 1% compounding ( will be writing another post about DRIP) and have invested in it.
If you had noticed, all the altcoins mentioned above provide the infrastructure needed for decentralized applications and have considerable market capitalization. I truly believe it is the best way to invest for growth.
Decentralize apps growth is going to explode and will be designed to be interoperable between various platforms. All platforms such as Ethereum, Solana, Cardano, Avalanche, Polkadot, Algo, Harmony will coexist and I foresee tremendous growth for these platforms.
Metaverse is going to explode in 2022 and infrastructure needs to meet the demands of these applications. It is very hard to predict who will be the leaders and laggers. I would dollar cost average into an ETF such as META ETF that invests in companies such as Facebook, Nividia, Roblox, etc.
I am not personally investing in gaming such as Sandbox(SAND), Decentraland(MANA), Axie Infinity (AXS). However, I will look for trading opportunities based on technicals.
This is not financial advice and I would highly recommend DYOR (Do your own research) before investing in the coins suggested. I would recommend you to dollar cost average in these coins to not get affected by the extreme volatile moves.
If you like this post, you might also like bitcoin vs dollar post. Also, did you know that Breakout trading strategy is one strategy that can be used for trading cryptos, stocks, options, and other derivatives and gives you the best risk-reward ratio (RRR) for the trades placed?
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