In real life, the chances of spotting the coin which will explode 10x are equal to winning a lottery. Yet that doesn’t mean you should give up on trying! In this article, I listed five cryptocurrencies that have the potential to succeed in 2022. Although they probably won’t provide you with three-digit returns, all of them are projects with interesting use-cases and unique utility worth taking a look at.
Market cap: $2,711,010,758
Market rank: #53
I already wrote about Helium , a blockchain-based decentralized network that provides cheap coverage for IoT devices. Anyone can join it by setting up a LORaWan hotspot and getting rewarded in HNT, Helium’s native token. The “People’s network” built by Helium uses energy-efficient proof-of-coverage and operates on the sub-GHz frequency that effectively lowers its energy consumption compared to Wi-Fi and Bluetooth protocols. Consequently, one Helium hotspot can run on one battery for up to ten years.
Apart from being distributed as a reward for hotspot hosts, HNT tokens are necessary for obtaining data credits, the only payment method to send data over the Helium network. Just like pre-paid cellphone minutes, data credits are non-exchangeable and tied to the original owner. To acquire them, a user has to convert their HNTs. Converted tokens are permanently removed (“burned”) from the circulating supply.
As the total IoT market is projected to reach $1 trillion by 2030 and the concept of smart cities is entering the mainstream, Helium seems to be an attractive investment. And it looks like venture capital is of the same view: yesterday Helium raised $200m in a Series D funding round led by Tiger Global Management and Andreessen Horowitz, gaining unicorn status. The company also announced changing its name from Helium to Nova Labs.
Market cap: $5,712,064,954
Market rank: #31
Launched in 2014, Stellar is an open-source payment network designed to move any type of currency across the world in seconds. To make it easy to send money anywhere, Stellar allows to create, send, and trade digital representations of any currencies, no matter crypto or fiat. To better understand how it works, imagine you issue a token for a dollar you hold. You promise to redeem the token when someone brings it back to you, basically establishing a 1:1 relationship between the dollar and your token.
To make transactions on the platform, users need to hold a small number of Stellar’s native cryptocurrency, lumens (XLM). Currently, the minimum balance is one lumen and the minimum transaction fee is 0.00001 lumen. Stellar says it created XLM to avoid favoring any specific currency, as the platform sets an ambitious goal to design a universal payment system. Since an average transaction cost on Stellar is just a fraction of a penny, it can be a good choice for individuals and companies who want to reduce the costs associated with traditional bank transfers.
Stellar’s ability to provide low-cost and instant transfers makes it a promising project. It has already established several partnerships with MoneyGram, IBM, and Circle (the company behind USDC). The rise of CBDCs and regulatory troubles similar to ones Ripple currently faces can hamper Stellar’s development, but in the longer run, the platform may achieve impressive success.
Market cap: $4,848,004,840
Market rank: #35
Decentraland is a blockchain that hosts a unique three-dimensional virtual world, where users can build their own characters, games, and applications. All objects are structured as NFTs and can be bought or sold for MANA tokens on the local marketplace. You can also buy the in-game plots of land for MANA, building your digital mansion from scratch. After the purchase, Decentraland burns tokens you paid for the item.
In the Decentraland, every space you interact with are LAND, non-fungible digital assets that can be traded for MANA and customized with in-built tools. Each plot of LAND is 33 by 33 feet, although the height is unlimited. The unions of several LANDs create Districts, which are governed by users through the voting dApp Agora.
As the concept of the Metaverse gains popularity, entertaining projects like Decentraland will attract more users. In the future, the virtual reality of Decentraland can become a platform for services in education, design, and leisure.
Market cap: $160,005,143
Market rank: #270
A small altcoin with a great potential to grow, Ergo aims to address Bitcoin and Ethereum flaws. Like Bitcoin, Ergo uses proof-of-work consensus, which has a higher fault tolerance compared to the proof-of-stake. At the same time, Ergo mining is more energy-efficient due to employing a different algorithm that puts a limit on mining pools and ASIC machines. That means you can mine Ergo with the common GPUs.
And just like Ethereum, Ergo’s blockchain is capable of deploying smart contracts but without the crippling gas fees. An average transaction cost stands at about 0.0011 ERG or two cents ($0.022). The platform already has several functioning dApps that include a decentralized stablecoin SigmaUSD, an NFT auction house, and a non-custodial crypto mixer that complicates transaction tracing. Apart from that, Ergo has a strong partnership with Cardano and uses its own smart contract language ErgoScript.
Currently, it may be a bit of a challenge to buy ERG, since it isn’t listed yet on any major crypto exchanges like Coinbase, Binance, or FTX. However, it also means there’s room for growth, as the listing can drive the coin’s price higher, given its unique combination of Ethereum and Bitcoin advantages.
Market cap: $5,317,964,565
Market rank: #34
VeChain is a blockchain platform that aims to improve supply chain management and support blockchain-based business applications. The platform also has the ambition to become the leader in initial coin offerings (ICOs) and dApps. With the help of the VeChain network, manufacturers and customers can track the quality, authenticity, and storage temperature of any item throughout its journey from the factory to the consumer. To collect such data, VeChain uses tags and sensors that send information to the blockchain, where authorized users can access it.
The platform has two different tokens, VeChain Token (VET) and VeChainThor Energy (VTHO). The first one is used as a means of payment on the VeChain blockchain. Meanwhile, the latter is the cost of carrying on the transactions, similar to Ethereum gas. VeChainThor is generated from VeChain Token over time, at the rate of 0.15 VTHO per VET annually. VET holdings also allow users to vote on the improvements to the network.
VeChain is a promising project to invest in, as it aims to integrate all business processes on one platform instead of being fragmented by multiple data silos.
The bottom line
Although all the coins listed above may be attractive investment opportunities, remember that cryptocurrencies are highly volatile assets and can shoot you down just as fast as they “mooned”. That’s why it may be a good idea to adhere to the diversified portfolio strategy, allocating a smaller part of the funds to risky but promising projects while investing the rest into coins from the top 25. And if you want to learn more about various investment strategies, you may want to check my article on different ways to make money from crypto.