Altcoins are all cryptocurrencies other than Bitcoin and stablecoins. At the moment, there exist somewhere around 18,000 listed and traded altcoins, so you’ve clearly got a lot of possible investment options.
To help make sense of the vast altcoin sphere and learn more about the wider crypto market, in this guide we’ll break down some of the basics you need to keep in mind when trading altcoins and provide you with our list of the most promising altcoins to pay attention to in 2022.
If you just want to see the list, feel free to scroll down to number 1.
The opinions presented in this article do not in any way constitute trading, investing or financial advice.
What are altcoins really?
Before we get to the list, though, let‘s start with a quick explanation. This will be particularly useful to any crypto beginners who might be reading this.
As mentioned, alt coins refer to coins that are an alternative to Bitcoin. So it is quite a broad term, encompassing a wide range of crypto assets. Moreover, altcoins vary significantly in terms of their profitability, past performance, reliability, and legitimacy, so you should never treat them as a single, monolithic category.
A good investment?
That being said, in this section we’ll share some general altcoin characteristics in order to give you a sense of their trading pros and cons.
First of all, there have been many instances where altcoins have generated massive profits in a very short amount of time, precisely because of the inherent flexibility and potential of altcoin projects. As part of a properly managed investment portfolio, new altcoins can take off and bring you returns that are near impossible for established coins like BTC or Ethereum to deliver.
Indeed, if you compare the performance of Bitcoin over the past few years to that of top-rated altcoins, the latter have a substantial edge.
So, in short, if your trading strategy is a little more boom-or-bust than slow-and-steady, then altcoins just might be the best cryptocurrency investment option for you.
Altcoins are also relatively cheap, allowing you to purchase hundreds or thousands of tokens for a fraction of the price it would take to buy one Bitcoin, for example.
Lastly, because of their number and variety, it is easier to diversify your crypto portfolio and thereby mitigate the risk of any one investment. Whereas if you just hold BTC and ETH, you are leaving your portfolio vulnerable to sustaining major losses, especially given the current bear market.
At the same time, there are risks to making major investments in altcoins that you need to be aware of.
First, a primary risk is the aforementioned issue of price volatility, as altcoins are much more liable to major price swings that Bitcoin. This means you have to watch your altcoin assets much more closely than other digital assets, to make sure you are not left behind when the price drops suddenly and substantially.
Second, despite representing an alternative to Bitcoin, all altcoin markets move somewhat in sync to the wider BTC market, meaning that the performance of your chosen altcoins can be hindered if overall trading sentiment is low.
Finally, always be on the lookout for scams and rug-pulls from projects that are created with the sole intention of scamming early investors after a rapid, but short, phase of growth.
Because of this, it is absolutely crucial to always do your own research and read up on a coin or token before putting your hard-earned cash in it.
And on that note, we’ve selected several altcoins that we think might be worth keeping an eye on during 2022 in alphabetical order.
Most Promising Altcoins
- Battle Infinity (IBAT) already looks like it wants to be one of the absolute best altcoin options for the year. As the name implies, Battle Infinity is based around ‘battle’ games, primarily the IBAT Premier League. This means that the coin almost functions like a fantasy sports league, but with integrated non-fungible tokens (NFTs) and works through the blockchain. Users can trade players through a built-in marketplace, which is both transparent and decentralized (it recently went through a full audit by SolidProof.io) and also trade with a range of NFT videogame-inspired options using the $IBAT token to facilitate transactions.In contrast to the recent bearish trend in the crypto market, Battle Infinity continues to offer hope to speculative investors, and may be a great way for you to turn a profit and finish out the year strong.
- Cosmos (ATOM) delivers a great response to the challenges of interoperability, the capacity of two or more distinct systems to communicate with each other. Generally, it has been difficult to get different blockchain platforms and blockchain networks to share data.The growth of Cosmos, and its ATOM token, has helped overcome these challenges, by providing the required technology to allow Bitcoin and Cardano or EOS and Ripple to share data.To make use of this new technology, the ATOM token is required, which helps explain the very healthy and consistent growth of this particular altcoin in recent years. Moreover, given its unique potential on the issue of crypto interoperability, the ATOM token is likely to outperform other altcoins in the coming months.
- Decentraland (MANA) is an interesting option because it is tied to the Metaverse, specifically the Metaverse real estate landscape and the global NFT marketplace. Users can buy, develop, and sell plots of land, all by using the MANA altcoin.Started in 2017 and now at the forefront of the digital real estate market, Decentraland is the perfect option for a person interested in exploring the Metaverse in search for high profits. Since its launch, the MANA token has seen end-to-end profits of more than 23,000%.
- DeFi Coin (DEFC) is another great option for most crypto portfolios. The native token of DeFi Swap, a new decentralized crypto exchange, DeFi coin has been picking up steam after the recent launch of DeFi Swap.This token’s success is obviously tied to the popularity of its corresponding exchange. And given the fact that the DeFi sector more broadly had a total value locked of around $200 billion USD during the first quarter of 2022, the potential of DeFi Swap to take off is quite promising. And if the exchange meets its potential, the DeFi Coin itself will be a sure bet for massive growth.
- Lucky Block (LBLOCK) is a top option for altcoins with crypto-gaming features. Basically, Lucky Block is creating an ecosystem that hosts fair and transparent play-to-earn games. And its price is still, at this moment, under $1, making it a bargain option with a lot of room to grow.Built with blockchain technology and working through a mobile app and desktop software, Lucky Block’s lottery system guarantees fairness and randomness, as its gaming outcomes are arrived at via the use of smart contracts.If you like the idea of ‘playing‘ while you invest and getting in on a project early, this is may turn out to be the altcoin for you.
- My Freedom Coin (MFC) is a innovative altcoin that helps minimize the potential for steep price drops. A DeFi project underpinned by a unique economic system, it has in-built mechanism that makes the cryptocurrency “crashproof.“ It does this by continuously raising the price floor of the coin, having a fixed supply of 7 billion tokens, and working off of a central ‘Treasury’ which regulates all offerings and guarantees liquidity.What’s more, MFC also serves as a wallet, its own cryptocurrency market, and a bank, all built on the Binance Smart Chain (BEP-20).This is an exciting concept and project, and it seems to be worth getting involved in.
- Polygon (MATIC) is an established layer-2 blockchain builder and accelerator of Ethereum applications processed separately from Ethereum’s main blockchain. Polygon is a popular choice among developers with over 19,000+ dApps already built on it, including 0x, AAVE, Algebra, Bancor Network, and Balancer, among others. Polygon’s ecosystem is rapidly expanding with the recent launch of Polygon Nighfall. The decentralized private transaction for enterprises solution will tackle two challenges: the lack of complete privacy and anonymity and the high transaction costs on Ethereum.Polygon is all-in-all a well funded and trusted ecosystem with cutting-edge technology and tremendous potential, which embraces and initiates partnerships with popular blockchain companies as well as several mainstream ones such as Instagram, Stripe and Adidas.
- Solana (SOL) is often considered an ‘Ethereum killer,’ because many market observers believe that Solana could one day overtake the Ethereum blockchain as the leading smart contract layer of the Internet. The main reason for this is that the Solana blockchain is significantly more efficient with its speed, scalability, and fees than its rival.One of the biggest problems Ethereum has is high transaction fees, making it unsuitable for micro-transactions. Solana, in contrast, is able to process transactions for essentially nothing. Accordingly, the Solana altcoin (SOL) has become a top-ten cryptocurrency in terms of market capitalization. Just half a year ago it breached the all-time price high of over $260, but its price has decreased quite significantly since then, making SOL a good choice for investors to buy (again).
- The Sandbox (SAND) is another major Metaverse token, as this project allows players from around the globe to explore the Sandbox ecosystem while communicating and networking.This ecosystem relies on personalized characters, which can then be used to compete in pay-to-earn games (similarly to Lucky Block). When tasks are accomplished, users earn in-game currency SAND.In turn, SAND can be used to buy and develop real estate, trade NFTs, and more. In just over a year of trading, SAND saw gains of over 16,000%. As we’ve seen with other altcoins, the price has since fallen in the last quarter, but the metaverse hype alone is likely to keep this option popular.
- Last, but certainly not least, Yearn.finance (YFI) is another DeFi project, but with a focus on connecting borrowers with investors. Here, you can take out crypto loans facilitated by automated smart contracts, where borrowers are required to put up a certain amount of collateral. Investors deposit funds into the Yearn.finance ecosystem, thereby facilitating loans.Yearn.finance is one of the most expensive altcoins on the market, hitting highs of over $90,000 in 2021. It has since come down, but its genius concept, high market cap, and strong past performance make it an easy recommendation for 2022.
That wraps up our Top 10 list! We hope you found this tour of other digital currencies helpful, and enjoy exploring the altcoin sphere! Your portfolio may one day thank you for it.
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