Despite the major cryptocurrency’s decline at the conclusion of the previous year, the cryptocurrency market had a prosperous year overall in 2021. Bitcoin increased by 64% throughout this period.
Read more: What is diversification?
The sector capitalization initially crossed $ 2 trillion in November at the same time the coin reached a record high of $ 69,000. But does that imply that the value of digital assets relative to fiat currency will increase this year? What trends the cryptocurrency industry is likely to experience this year and which cryptocurrencies are worth investing in.
Bitcoin will still be the most valuable cryptocurrency in the world even after its value drops towards the end of 2021. Since entering the market in 2009, Bitcoin has established itself as a trustworthy investment cryptocurrency. Investors may view any decrease in the value of BTC as a chance to purchase this virtual currency at a lower price since it is no longer able to do so.
Currently, the price of BTC is $ 43,914.39; its market capitalization is $ 828,005,485,118; and its daily trading volume is $ 27,993,754,952.
Bitcoin’s value might reach $100,000 in the following five years, according to Goldman Sachs researchers. About 20% of funds are currently held in Bitcoin, but by the end of 2022, that percentage will rise to 50%.
In terms of market capitalization, Ethereum is one of the greatest cryptocurrencies to invest in, coming in second place to Bitcoin. This digital coin now has a market capitalization of $377,855,502,904 and a trade volume of $28,207,246,654. This digital coin has a lot of applications technologically. The automation of the exchange is the primary purpose. With the use of Ethereum smart contracts, two parties can interact quickly, securely, and with the least amount of red tape imaginable.
The development of new commercial and decentralized application models will help this coin thrive over time.
It should be highlighted that the project’s fundamentals, its strong plan through 2022, and Ethereum’s significant upgrade to version 2.0 next year will all contribute to the coins’ further appreciation.
Ethereum may cost between USD 8,000 and USD 10,000 by the end of 2022, according to analysts.
Cosmos (ATOM) is regarded as one of the best options if you want to invest in cryptocurrencies. Currently, the project has a market capitalization of $8,624,134,049 and a daily trading volume of $758,246,885.
The blockchain that this coin runs on is fittingly referred to as «Blockchain 3.0.» Cosmos is a cross-chain solution that enables communication between all blockchains operating within the Cosmos ecosystem and external networks like Ethereum and Bitcoin.
On the Cosmos network, more than 250 decentralized applications with a combined capitalization of over $70 billion have already been deployed. Binance Smart Chain, Qredo, and OKExChain all utilize the Cosmos infrastructure.
There are no comparable cryptocurrencies to Cosmos. Polkadot, which allows for self-creation of parachaines, is the lone exception to this rule.
Since several large cryptocurrencies already employ the Cosmos project’s technology, experts think this ecosystem has significant future growth potential. As a result, by the end of 2022, the price is anticipated to reach $40–$50. Keep in mind that the price of Cosmos (ATOM) is currently $30.35.
Decentralized finance (DeFI), decentralized applications (Dapps), and smart contracts are all powered by Solana. To ensure that transactions are processed quickly and securely, Solana uses proprietary hybrid Proof of Stake (PoS) and Proof of History (PoH) protocols.
The SOL token was created to function on the Solana platform. After the project took part in the Initial Coin Offering (ICO) in 2018, the value of SOL started to increase. Solana then sold about 80 coins. The token’s price at the time was 4 cents. Currently, investors are paying $ 117.39 for each coin. The SOL coin has a market cap of $38.010,676,434 and a 24-hour trading volume of $2,500,219,132.
Users of the platform have access to the Solana blockchain using SOL tokens, which enables the development of decentralized applications, or Dapps.
Compared to its well-known rival Ethereum, Solana is much faster. Between 3,187 and 65,000 transactions are processed every second by Solana. Only 15 transactions are processed by Ethereum every second, compared to 5–7 for Bitcoin.
A network information block is created by Solana in 0.4 seconds, an Ethereum block in 10 seconds, and a Bitcoin block in 10 minutes. The speed of the work affects the commission that miners pay. Because of this, the fees for Solana range from $ 25 to $ 53 depending on the price of electricity, or less than a cent per transaction for Ethereum. The Saber cryptocurrency exchange, the DeFi Land simulation game, the Audius streaming service, and over 900 more apps have all been developed on the Solana blockchain. There are over 3,000 such applications in Ethereum, according to the State of the Dapps tracker.
One of the most promising cryptocurrencies to invest in in 2022 is Polkadot (DOT). Due to the successful integration of numerous blockchains from the same network, it has gained popularity by providing investors with a range of options. Polkadot is expected to help cryptocurrency investors make huge gains since analysts predict that as parachains are introduced one after another, Polkadot’s value will rise sharply. A price range of $40–$60 is the realistic goal for 2022.
DOT currently trades at 22.73 dollars, has a market cap of 22,536,546,667 dollars, and a 24-hour trading volume of 1,529,062,811 dollars.
Globally, many people use the Binance cryptocurrency exchange. The purpose of this platform is to facilitate cryptocurrency trading while reducing transaction costs. Fast and safe transactions are available to users of the Binance exchange.
The native Binance coin (abbreviated BNB) is used to cover exchange service fees. According to several analysts, people who purchased BNB tokens now would profit greatly because the currency price might reach $1,000 in 2022.
BNB is worth $71,972,186,832 on the market. On February 9, 2022, the cost increased from $ 0.10 in 2017 to $ 428.63. So, if you’re interested in investing in cryptocurrencies, you should consider this virtual money.
One of the greatest cryptocurrencies to invest in is Cardano (ADA). The Cardano cryptocurrency ranked seventh globally in terms of capitalization in February 2022 with a value of $ 40,252,702,248. The ability to use this design in the DeFI space is the primary factor in its appeal. Smart contracts built on blockchain technology can assist in settling transactions between participants with full compliance and transparency, without the need for middlemen.
Be mindful of the extreme volatility of digital assets if you do choose to invest in cryptocurrencies this year. Strong value changes can lead to both significant profits and complete losses. Therefore, seasoned traders and investors advise diversifying your assets by buying a variety of coins.
Additionally, you should conduct market research to determine the current trend in cryptocurrencies before making an investment. Following the study, you can choose a course of action and determine which cryptocurrency to invest in.