Even though the benchmark S&P 500 saw an increase in its average annual total return in 2021, compared to the previous four decades, cryptocurrency took the spotlight on this occasion.
CoinMarketCap.com indicates that the total value of all digital currencies was $2.25 trillion at the time of this writing. From the beginning of 2021, that number was up 191%. With Bitcoin and Ethereum consistently outperforming the "Big Two, "cryptocurrency investors are likely wealthier today than they were a year ago.
Yet despite extreme volatility, there is still a great opportunity for investors to make money -- if they stick to projects that offer differentiation and differentiate them from the competition.
Here are seven cryptocurrencies you can invest in that can triple the value of your money in 2022.
Avalanche is the biggest cryptocurrency by market cap, and I believe it has a realistic chance of tripling its value this year.
There are several reasons why Avalanche is a logical choice to develop decentralized applications (dApps) because of its incredible speed and compatibility. In smart contracts, parties negotiate a contract using a protocol that verifies, facilitates, and enforces the terms of the contract.
The blockchain-based network according to Avalanche's development team can process north of 4,500 transactions per second (TPS) and achieves block finality in less than two seconds. Bitcoin and Ethereum, the two most popular blockchain networks, are capable of handling 7 and 13 transactions per second (TPS), respectively, and they can complete transactions in approximately 60 minutes and six minutes, respectively. Avalanche is by far the most efficient cryptocurrency compared with the most popular ones.
It is the compatibility, however, that is the real draw. There's no doubt that Ethereum Virtual Machine (the software that allows developers to build Ethereum dApps) is the most popular tool for dApp developers. The Ethereum Virtual Machine is used by Avalanche. Therefore, dApps can avoid Ethereum's network congestion, high fees, and lag caused by Ethereum's blockchain by migrating to Avalanche's network. In 2022, Avalanche will have a major selling point in this area.
You could triple your money in 2022 by investing in Qtum (pronounced "Quantum").
According to their market value dominance, Bitcoin and Ethereum both enjoy a huge following among investors. These networks, however, have some disadvantages. Transaction fees are high, they're congested, and they're slow.
The solution is Qtum, a blockchain project that combines the features of both networks into one.
With Qtum's blockchain, you get UTXO transaction security from Bitcoin and Ethereum Virtual Machine functionality. As a result, smart contracts are supported within a secure network. In other words, Qtum can be used to send payments and develop dApps, such as applications providing decentralized financial services (DeFi). It is a smart option for developers of dApps because of its low transaction fees and ability to process 70 transactions per second.
Moreover, the Account Abstraction Layer (AAL) of Qtum makes it stand out from other platforms. The AAL component of Qtum is what lets its engineers continuously upgrade the smart contract component of its blockchain while guaranteeing that, no matter how many upgrades are implemented, the UTXO transaction model will remain compatible.
The company has a handful of successful partnerships under its belt, making Qtum a strong bet to outperform.
Although Bitcoin gets a lot of love in the crypto community, payment coin-based networks are not prominent. There is one cryptocurrency that deserves attention, however, and that's Stellar, the 27th-largest digital currency by market value.
Consider a scenario in which you have U.S. dollars in your pocket and wish to transfer money to a friend or relative in the United Kingdom. If this transaction is validated and settled by traditional banking routes, it could take a full week within today's current infrastructure.
On the other hand, if you used Stellar's blockchain-based network, your dollars would be converted into XLM (the protocol token of the network) and sent to their destination before being converted to British pounds. When would this transaction be completed? In about four to five seconds. That's more than the average person can walk to their fridge after hitting the send button, validating, and settling. This far surpasses most blockchain-based networks, which can handle only a few hundred TPS.
Stellar's services are also extremely cost-effective. It costs Stellar's network an average of 0.00001 XLM per transaction. At the current price of $0.274 per Lumen, an individual would have to go through more than 364,000 transactions before incurring a single fee. In contrast, Bitcoin regularly charges fees of $2 or more, which are much higher than traditional banking fees.
It should be taken seriously by crypto investors due to Stellar's history of landing major partnerships.
Algorand, the 22nd largest digital currency by market value, is another cryptocurrency that can triple your money by 2022.
In this list, one of the main themes is a competitive advantage. Through Algorand, users obtain highly efficient and scalable execution. As reported by Algorand, the network offered a block finality of 4.36 seconds and was processing at 1,162 TPS. Stellar offers a similar block finality of 4.36 seconds.
In Algorand, there is a unique twist on the traditional proof-of-stake consensus mechanism. As a pure proof of stake (PPoS) technology, ALGO holders are chosen at random and secretly to propose blocks and vote on proposed blocks. With PPoS, it is impossible for a small minority of ALGO holders to disrupt the network because the randomization associated with it ensures that.
It is Algorand's emphasis on interoperability that makes it so intriguing. It is understood by the development team that a large number of blockchain projects may not be compatible with one another. The focus of Agorand is to bridge these gaps to introduce DeFi and dApps on a large scale.
Algorand has all the tools necessary to triple its revenues in 2022 after quadrupling in 2021.
Here's a new digital currency to add to your radar: Nano, the tiniest on the list, with a market cap of just over $500 million. Despite being small, the nanotechnology company could be the next big thing for patient investors this year.
Nano is a network coin that outperforms traditional payment methods in terms of speed and scalability, just like Stellar.
Nano stands out from thousands of other payment coins thanks to its blockchain network. Blockchains used by Nano are block-lattice blockchains. They are designed so that every user has their own blockchain he or she can add to. Because users have their own blockchains, they don't have to compete with other users to submit new blocks, and they can send and receive payments without getting approval. As a result of Nano's network scaling capability, the network can grow very rapidly without adversely impacting its performance.
As far as performance is concerned, Nano has the fastest block finality. Most transactions are validated and settled within one second according to its developers. Yes, one second!
The Open Representative Voting (ORV) consensus mechanism of Nano provides additional differentiation. The ORV is the major factor in ensuring that transactions on the network are fee-free without going into the weeds.
In summary, Nano can perform cross-border transactions for free in less than one second. We call this a competitive advantage.
6. Axie Infinity
The metaverse is undoubtedly the hottest trend in the cryptocurrency space at the moment. Investors are more specifically enthused by the prospect of virtual worlds that are decentralized and based on blockchains. As of today, Axie Infinity is leading the charge and has the potential to triple investors' money in 2022.
With the help of the Ethereum blockchain, Exie has created a play-to-earn game that's been a big hit recently. The game lets players collect, raise, breed, and battle Axies, which look like monsters. To participate in battle, a user needs at least three Allies. Axies can be improved by gaining experience points when they win battles, as in traditional games.
It all sounds pretty straightforward, but Axie Infinity departs significantly from traditional gaming in one key respect: ownership. It remains the property of the developers of a game that you download on your Xbox that allows you to modify characters or build your own virtual world. Axie tokens, in contrast, become non-fungible when raised. This can be monetized on a marketplace or used in gameplay. In other words, with Axie, players take full ownership of all their creations, which is in stark contrast to what has always been the case with gaming.
Additionally, Axie is generating some cold, hard green within its game. The trailing-90-day revenue from Axie Infinity's protocol dApps stood at $1.24 billion according to TokenTerminal.com. Ethereum ($4.98 billion) was the most valuable in this period.
By 2022, Axie Infinity could become a hot token thanks to increasing real-world usage.
Lastly, IOTA is the seventh and final cryptocurrency that will triple your money in 2022. In 2017, IOTA was ranked among the top-10 digital currencies by market cap. Now it is No. 42, according to CoinMarketCap.com.
In the context of over 16,000 cryptocurrencies on the market, differentiation and competitive advantages are necessary to make your cryptocurrencies stand out. In the same way as the projects I described above, IOTA offers these advantages as well.
IOTA is interesting because it isn't a blockchain technology. A direct acyclic graph (DAG) called the "Tangle" was built instead, requiring new transactions to confirm the two preceding transactions. This web of interconnected transactions propagates along a timeline, creating a tangled web (hence the name "Tangle").
Rather than blockchain as seems to be the case with every other project, why Tangle?
Apparently, blockchains have a tendency to slow down when new blocks are generated, voted on, and validated. With Tangle, these hurdles are removed, providing a faster and more scalable, fee-free network, like Nano.
Furthermore, IOTA made headlines when it announced a major partnership with Dell Technologies. Through Project Alvarium, data will be analyzed and logged for trustworthiness before it can be used by applications.
So, if you want to potentially triple your money in 2022, forget the brand-name coins and think smaller and off the radar instead.