The 2021 alt season brought in a huge rally, much to the delight of crypto investors who saw a lot of price appreciation after an extended gloomy period. 2021 has been a hallmark year for cryptocurrencies in general as global opinion has shifted from outright bans to a culture of regulation and accepting such coins as part of the economy. Below is a recap of what 2021 managed to bring in with a forecast on what altcoin season 2022 could be like. If you are interested in Alt Coin’s, please check Alt Coin Reviews for more!
The rise of Binance coin (BNB)
2021 marked the undisputed rise of the Binance coin. The BNB cryptocurrency managed to reach a record high of $686.31 on May 10, 2021. The price of BNB, just a year ago on May 10, 2020 was $16.83. 2021 also saw many token launches on the BSC network making it a strong competitor to the Ethereum network. The Binance coin could smash further records as the exchange seeks regulatory approval around the world.
The rebirth of Ethereum and scaling networks
The Ethereum network saw a lot of price erosion in the crypto downturn in 2020. The growth in price of the ETH token has led to mainstream adoption and investments from deep pocket investors and funds. The price of ETH has risen to $4188 at the time of writing from $589 on December 15, 2020. The price fall in Ethereum was largely due to its rising fees and heavy congestion. This could change with Ethereum shifting from a Proof of Work (PoW) to a Proof of Stake (PoS) network. Ethereum will remain a strong investment opportunity in the future.
2021 also saw the emergence of scaling solutions such as Polygon (MATIC). The Polygon token was trading at a few cents in 2019-2020 but it rose to reach an all time high price of $2.62 on May 18, 2021. It remains to be seen if such scaling networks can maintain their relevance with Ethereum’s problems being solved through a shift from PoW to the PoS network.
Other major altcoins
Avalanche (AVAX) has managed to gain entry into the coveted list of the top ten cryptocurrencies by market cap and could soon pose a worthy challenge to the likes of Ethereum and Cardano. Another powerful network is Polkadot (DOT) and with its para chains and interoperability, it has already become the network of choice for many developers. The Polkadot coin achieved an all time high price of $54.98 on November 4, 2021). Older altcoins such as Ripple (XRP) and Cardano (ADA) also appreciated in price and have seen significant adoption from the cryptoverse.
Meme coins such as Dogecoin (DOGE) and Shiba Inu (SHIB) have surprised investors by their enormous rise largely fuelled by an enthusiastic community of loyal supporters. The tweets from Elon Musk have given rise to a generation of meme coins and this could continue in 2022 as well.
What could the 2022 altcoin season promise for investors?
There are four broad themes that cryptocurrencies could continue to focus on in 2022. These are: Gaming; DeFi, Metaverse, and Meme coins.
While the blockchain technology and cryptocurrencies can be used to solve many issues, each year there are some areas where the crypto mania reaches enormous proportions and the resultant hype could yield rich returns. These themes are explained below and their respective tokens are also mentioned.
The rise of Axie Infinity (AXS), a popular gaming token, was not a surprise to seasoned crypto investors. Gaming is a powerful investment opportunity and sooner or later, crypotverse was going to embrace it. The AXS token reached its all time high price of $164.90 on November 6, 2021. The all-time low price was $0.12 exactly a year ago.
2022 could see more gaming tokens launched on alternate networks such as the Binance chain but most tokens today are looking at interoperability between different chains. Ensuring compatibility between Ethereum and Binance networks is also an important aspect for most crypto developers.
Another gaming token that could mimic the growth of Axie Infinity could be Gala (GALA). The eponymous cryptocurrency allows in house NFT (non-fungible tokens) and players get to enjoy a completely decentralised network run by participant nodes. The GALA token is currently trading at $0.4 at the time of writing and could possibly 2X or 10X from its current levels if the network can expand its reach and demonstrate better adaptability and interoperability.
Binamon (BMON) is another gaming token that is currently available at an attractive price of $0.33 at the time of writing.
Decentralised finance (DeFi) is a strong sector and many token launches have focused on solving this important issue. With regulatory issues surrounding the centralised exchanges, decentralised exchanges (DEX) could be a popular investment theme for 2022. Some important tokens in the DeFi sector include Terra (LUNA) which is currently trading at $41.93 at the time of writing; Uniswap (UNI) which is the driving force behind the world’s most popular decentralised exchange and is currently trading at $21. AAVE, Thorchain (RUNE), and Yearn.finance (YFI) will also continue to remain relevant in 2022 and beyond. The ability to farm tokens and receive a regular passive income source from cryptocurrencies has made decentralised finance a very strong investment opportunity.
With Facebook deciding to rebrand itself, focus has renewed to the metaverse and the virtual artificial intelligence (AI) sector. This could become a potentially strong investment theme in the cryptocurrency sector in the next few months. 2022 could very well be the year of metaverse tokens.
Bloktopia (BLOK) is currently a small cap token that allows building properties in its metaverse and has seen strong adoption from the likes of Cointelegraph and Kucoin. The Bloktopia metaverse allows building virtual offices in its skyscraper that includes 21 levels (inspired by 21 million bitcoins). Find more metaverse tokens reviewd here!
Other metaverse tokens that could possibly see a rally in 2022 are Sandbox (SAND) which is currently trading at $3.93 and could possibly 2X or 5X if the token sees strong adoption. Radio Caca (RACA) that allows players to enjoy games, build art galleries and own properties could also be a strong bet. It is available for a few cents currently but could boom possibly in 2022.
Will meme coins remain relevant in 2022 or will die out as strong technology is favored over community tokens such as SHIB, DOGE and FLOKI (Floki Inu). It doesn’t look like meme coins will soon become history as Dogecoin and Shiba Inu have cemented their place in crypto history. However, the huge supply of such tokens could be a strong impediment that could prevent a strong price appreciation. The meme coins have introduced burn mechanisms to tackle this issue.
To recap, while 2021 saw traditional altcoins appreciating in price, 2022 could see metaverse bursting into the cryptocurrency space with decentralised finance continuing its dominance. Gaming and NFT space are other promising areas that could prove to be exciting investment opportunities.
Note: All prices have been sourced from coingecko and coinmarketcap.