2021 has been a rollercoaster for cryptocurrency investors. From the massive rally in April that saw meme coins make new highs to the dip of early December, fortunes have been made and lost. The big question now is, what does 2022 hold for cryptocurrencies?
It is important to look at the trends to understand where the markets could go in 2022. Elon Musk is an influential figure in crypto and continues to influence the market's direction. He has started making positive comments about Dogecoin (DOGE), which is a plus for meme coins in 2022.
Away from meme coins, there is a lot of hype around Ethereum layer 2 scaling solutions as the transition to Eth 2.0 gets finalized. This means going into 2022, the most dominant Ethereum layer two scaling solutions could rally.
There is also a lot of momentum around Ethereum competitors that have proven to scale fast, and at low cost. With the demand for scalable blockchain solutions on the rise, these blockchains will only grow in 2022.
Thanks to Facebook's recent rebrand to Meta, the Metaverse is getting a lot of hype. This means Metaverse cryptocurrencies have a promising future ahead of them.
With this background in mind, here are the top 10 cryptocurrencies to buy and own in 2022.
Best Cryptocurrencies to Watch in 2022:
- Dogecoin (DOGE)
- Polygon (MATIC)
- Loopring (LRC)
- Polkadot (DOT)
- Avalanche (AVAX)
- Solana (SOL)
- Ethereum (ETH)
- Cardano (ADA)
- Chainlink (LINK)
- Axie Infinity (AXS)
Dogecoin (DOGE) is a meme coin and one of the best cryptocurrency performers of 2020/21. In this period, Dogecoin is up by over 10,000%.
Going into 2022, there is a lot of look forward to for Dogecoin. Elon Musk, who nicknamed himself Dogecoin father, announced that Tesla will start accepting Dogecoin for payments.
The cryptocurrency market was abuzz on December 14th, 2021 after Elon Musk, the CEO of Tesla, announced that Tesla will be making some merchandise buyable with Dogecoin. On the strength of this news, Dogecoin gained by over 21% in a matter of minutes, making it one of the day's best performers.
Now that the broader cryptocurrency market is bearish, this news could see a lot of money flow into Dogecoin going into 2022.
Some even potentially bigger Dogecoin news is coming up in 2022, and they involve Musk's other company, SpaceX. In May, Musk announced that Dogecoin would be used to fund a lunar mission called the Doge-1 mission.
According to Geometric Energy Corporation, which is also part of the mission, DOGE-1 will fly aboard SpaceX's Falcon 9 rocket, and the payload "will obtain lunar spatial intelligence from sensors and cameras on board."
At the time, SpaceX's Tom Ochinero stated that the mission would demonstrate how crypto could become the basis of trade between Earth-based economies and those on other planets.
With all the spotlight that the latest Tesla news has put on Dogecoin, positive news about the Doge-1 mission could send DOGE rocketing in Q1 of 2022. Dogecoin rallied by 21% within minutes of the Tesla news. This means sustained momentum going into 2022 could easily see it test $1 or more.
A combination of these factors makes Dogecoin one of the top 10 cryptocurrencies to buy and own in 2022.
Read more: Dogecoin Price Predictions
Polygon (MATIC) is a well-known Ethereum layer-2 scaling solution. In layman's terms, Polygon is one of the networks that are expected to ease the pressure off the Ethereum mainnet once the transition to Ethereum 2.0 is complete.
Polygon has had a stellar performance over the last couple of months. Year-to-date, MATIC is up by 10,180%.
Polygon has also been taking steps to become as efficient as an Ethereum layer-2 solution.
In November 2021, Polygon announced that it had added Zk-Rollups to its architecture through a solution called Miden.
Ethereum's ZK-Rollups are a great way to reduce congestion on the main chain, but they can't do everything. That's where Miden comes in! The Virtual Machine will allow smart contracts and other transactions requiring the decentralization of power, making them faster than ever before, with less gas fees.
At the time, Polygon's co-founder, Sandeep Nailwal stated that, with Miden VM's help, Ethereum will be able to scale smoothly and efficiently. Essentially, this means that Polygon has positioned itself to be one of the most important Ethereum Layer-2 solutions, and that's good for the value of MATIC.
Considering that Polygon already has a decent number of projects running on top of it, 2022 could be huge. The transition to Eth 2.0 is expected to be completed in mid-2022, giving Polygon and other Ethereum L2 solutions even more power.
On this basis, Polygon easily stands out among the top 10 cryptocurrencies to own in 2022. If its price action in 2021, when Ethereum is still in transition, is anything to go by, then MATIC could go parabolic once the transition is complete.
Loopring (LRC) is another Ethereum layer two solution getting a lot of attention lately. Year-to-date, LRC is up by 1000%, making it one of the best cryptocurrency performers this year.
Loopring is an Ethereum layer-2 solution that aims to make trading on the Ethereum blockchain fast and low cost.
As mentioned above, one of the advantages of Loopring is the ability to give users low transaction costs. Loopring has created a new kind of blockchain that could revolutionize how we do business. Ethereum is famous for its high costs when transferring assets from one person or organization to another, but not anymore! With Loopring, it's easy and cheap, without having any worries about gas prices rising unexpectedly on-chain because they're handled off-chain instead.
Loopring also has the advantage of security. Loopring is non-custodial and open source, which means you always control your assets. Loopring also uses zkRollup, hence providing unbreakable security for all participants in an environment where nobody needs to trust anybody else but themselves.
Loopring also has a high throughput. By using the ZkRollups batch processing method, Loopring can avoid the scaling issues associated with the Ethereum main chain.
With Ethereum's transition to Eth2.0 almost complete, Ethereum could experience an increase in adoption, especially in DeFi. Given that trading is one of the biggest aspects of crypto, a fast, low-cost DEX like Loopring could see widespread adoption going forward.
This means there is a good chance for LRC to rally in 2022 and possibly best its 2021 performance. LRC has rallied by 1000% this year while Ethereum is still in transition. Once the transition is complete, it is not implausible for LRC to give an above-average return in 2022.
Combining these factors makes LRC one of the top 10 cryptocurrencies to buy in 2022.
Polkadot (DOT) can't miss in a list of top 10 cryptocurrencies to buy and own in 2022. That's because Web 3.0 is gaining traction, and Polkadot is one of the blockchain's best positioned for it.
Polkadot's readiness for the Web 3.0 revolution is evident in some of its core features. For starters, Polkadot is designed for interoperability. If you want to send or receive any type of data on a blockchain, Polkadot is the platform for you. Connecting with this network gives users access to blockchain agnostic token transfers and the seamless transfer of other types of assets like stocks and cryptocurrencies!
Considering that interoperability is the key to the growth of Web 3.0, Polkadot has the edge over other blockchains going into the future. With the Ethereum transition to Eth 2.0 set to be completed in 2022, interoperable blockchains like Polkadot could experience a surge in demand for Dapp launches.
Polkadot also happens to be one of the most scalable blockchains out there. On the surface, Polkadot may seem like any other cryptocurrency network. But Polkadot is something completely different and revolutionary from a deeper look at it! It provides unprecedented economic scalability by enabling a common set of validators (or nodes) from all across diverse blockchain spaces.
Similarly, it also allows transactions on these parallel chains to be spread out via cross-chain validation software that utilizes Smart Bridges. This essentially solves two major problems at once: transactional scaling and transaction isolation because there will always exist one bridge per realm/protocol ready to process every possible type of transaction.
Polkadot's core features of interoperability and scalability have seen it gain quickly in adoption. Lately, there has been an increase in the number of algorithmic stable coins launching on the Polkadot network. Going into 2022, Polkadot could see an increase in adoption for DeFi projects that need to scale cost-effectively for them to make an impact.
Polkadot's ease of use is also a plus for long-term adoption. Thanks to the substrate framework, pretty much anyone can build on Polkadot.
These are all reasons why Polkadot is a cryptocurrency to buy and hold in 2022.
Avalanche (AVAX) is one of the best performing cryptocurrencies of 2021. Year-to-date, AVAX is up by 2430%. Avalanche's performance has a lot to do with its scalability and low-cost transactions. With Ethereum gas prices still high despite recent upgrades, Avalanche and other highly scalable blockchains have benefited from it.
One factor that makes Avalanche stand out is its compatibility with the Ethereum blockchain. Since Avalanche is compatible with solidity, developers have found it a useful platform for launching highly scalable blockchains that can run on the Ethereum blockchain.
Avalanche also has the advantage of blockchain customization. With Avalanche, you can create your very own blockchain. You can also deploy your private or public chain on any of the leading blockchains such as Ethereum or Bitcoin, ensuring that you get all their benefits, such as security, without dealing directly with them!
Thanks to the strength of its core features, Avalanche has experienced an upsurge in adoption lately. On December 14th, it was reported that Avalanche was adding USDC, further entrenching itself in the DeFi space. Before adding USDC, users of this stable coin had to bridge from Ethereum.
While commenting on the move to add USDC, Ava Lab's John Wu stated that the partnership is a huge leap for Avalanche and Circle (the company behind USDC), and will allow native USDC coins to be minted on Avalanche, cutting out the hassle of purchasing or selling them. Wu added that for those who use stablecoins as part of their DeFi strategy—there's around $1B worth currently passing across that bridge! In essence, adding USDC could lead to an upsurge in its usage in the DeFi space.
With the core functionalities strong, and adoption on a growth trajectory, AVAX is undoubtedly one of the top cryptocurrencies to buy and hold.
Read more: Avalanche Price Predictions
Like Avalanche, Solana (SOL) is another Ethereum competitor that has shot up in popularity throughout 2021. Solana is up by over 2000% year-to-date. Solana's rise has a lot to do with its unrivaled scalability of over 50k TPS, and low transaction costs.
While it has been a top performer this year, Solana has faced a number of issues that raise questions about its decentralization. A few months ago, Solana was attacked, leading to an outage for hours.
Solana suffered a DDOS attack again on December 12th, and while this did not bring down the network, it led to a drop in TPS.
According to industry experts, this could dent investor confidence in Solana. One such person is Daffy Durairaj, the co-founder of a company that offers blockchain trading services. Durairaj stated that Solana's recent track record is stymying outreach efforts. To quote him,
"I'm trying to bring in these market makers and traders but they just lose faith when we have network outages."
Interestingly, Solana's price has not dropped much, despite this news. This indicates that investors are still bullish on Solana despite the recent attacks. Developers, too, seem to be sticking with Solana. Since the attack, Solana transactions have been on the rise.
It is also important to note that Solana is still a new project, and the Proof-of-History technology is yet to be fully tested. This means it has the potential to overcome the issue facing it at the moment.
This makes Solana a high-potential cryptocurrency to buy and hold in 2022. If it overcomes its current security issues, Solana could easily test prices above $1000 at some point in the future.
Ethereum (ETH) is one of the most stable cryptocurrency investments in the market today. Despite its scaling issues, the number two cryptocurrency by market capitalization continues to dominate the platform blockchain space.
Ethereum's success has a lot to do with its decentralization and security. Recently, many 'Ethereum killers' have come up, but most of them are weak on the two blockchain pillars of security and decentralization.
With some of the more centralized Ethereum competitors getting hit by bad actors recently, Ethereum's image has got a boost. This could see Ethereum adoption, and by extension, its value could grow significantly going into 2022.
Besides, Ethereum is in the progress of an upgrade that will help it complete the three blockchain pillars – Scalability, Decentralization, and Security. Ethereum intends to scale by shifting from Proof-of-Work to Proof-of-Stake, and will also rely heavily on layer-2 solutions.
So far, most of the work towards Ethereum 2.0 is almost complete. In October, Ethereum Foundation announced through its blog that most of the work towards the shift to Ethereum 2.0 was done. The best part is that Ethereum will be completely deflationary once the shift to Ethereum 2.0 is done.
Considering that the demand for Ethereum will only go up after the shift to Ethereum 2.0, its value could go up significantly as well. Essentially, Ethereum is a low-risk, high-return cryptocurrency that you can buy and own in 2022.
Read more: Pros and Cons of Investing in Ethereum
Cardano (ADA) hasn't moved much since October, but it still makes sense to have it in a 2022 cryptocurrency portfolio. Cardano has been slow in development, but it has got things right along the way.
For instance, through its Ouroboros Proof-of-Stake, Cardano has solved the blockchain trilemma of security, decentralization, and scalability. Ouroboros is a protocol that allows Cardano to remain secure and sustainable without relying on trusted third parties. It does this by combining behavioral psychology with economic philosophy, which creates an assurance of security while also facilitating permissionless transactions and fast.
The value of Cardano's Ouroboros Proof-of-Stake algorithm is emerging now that projects with some element of centralization are getting hacked. There is a high likelihood that Cardano could see adoption from investors who want to develop Dapps, especially those focused on finance and other highly sensitive industries.
Cardano is also quite attractive to earn passive income through staking. Everyone who holds ADA, even if it is one ADA, can take part in governance while at the same time earning off it. This unique governance model positions Cardano for future growth. At the same time, ensuring users are constantly involved in deciding what updates need implementing on their platform through funding proposals from within community members.
With all these factors in Cardano's favour, there is a good chance that Cardano could experience massive adoption going into 2022. For this reason, it makes it to the list of top 10 cryptocurrencies to buy and own, not just in 2022 but for many years to come.
Chainlink (LINK) has underperformed most major cryptocurrencies over the last few months of 2021. However, this does not mean it does not have potential in 2022.
Chainlink's potential has a lot to do with the fact that it is the number one oracle blockchain in the market. So far, all major smart contracts run on Chainlink decentralized data.
Due to Chainlink's dominance in the data market, more projects are likely to gravitate towards it going into the future. With Web 3.0 on a growth trajectory, Chainlink's prospects for 2022 look good.
At the same time, Chainlink has been making moves that will keep it at the cutting edge of the decentralized oracles space. One of the best aspects of Chainlink is its use of hybrid smart contracts.
Chain hybrid smart contracts allow for a combination of third-party data with on-chain data on the Chainlink network. This approach means that no matter the demands that are put on the network, Chainlink will always scale with ease.
On the strength of these fundamentals, there is a good chance that Chainlink could gain in value going into 2022. It is, without a doubt, a top 10 cryptocurrency to buy and hold in 2022 and beyond.
Axie Infinity (AXS)
Axie Infinity (AXS) has had a stellar run in 2021. Year-to-date, AXS is up by 14,519%, putting it at par with meme coins like Dogecoin in terms of gains. The key driver behind Axie Infinity's momentum is the increased interest in play-to-earn games.
Players love the fact that they can create characters and monetize them as NFTs on the Axie Metaverse.
However, it is not just gamers that are finding Axie Infinity attractive. Investor interest in Axie Infinity has also grown thanks to the ability to stake AXS and SLP tokens and earn a passive income.
Going into 2022, there is a lot to look forward to for Axie Infinity. Facebook has put the Metaverse in the spotlight with its rebrand to Meta for starters. The momentum this has created around Metaverse cryptocurrencies like Axie Infinity will only grow stronger in 2022.
Besides, Axie Infinity being one of the biggest players in the Metaverse, could draw the most interest. Its dominance, coupled with the fact that a well-funded organization backs it, easily makes AXS a top 10 cryptocurrency to buy and own in 2022 and potentially for many years to come.
Read more: Axie Infinity Price Predictions
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