Last Updated on May 24, 2022 by
Cryptocurrencies made headlines in 2021 with their constant surge and drop. With a 35-40% rise and over 50% drip in a single day, cryptocurrencies remained in the eye of the storm, constantly defying every principle of investing and portfolio management.
Besides their initial performance in 2021, cryptocurrencies and their counterparties like NFTs are gaining popularity with the majority of the globe. Every investor is now intrigued by how much impact cryptocurrencies can have on the markets. New blockchain projects have already attracted new investors.
The performance of cryptocurrencies in 2022 is likely to be affected by various factors like NFTs, DeFi, Government rules and policies across the globe, taxations, and the addition of more decentralized finance platforms. Here is a glance at how some well-known and popular cryptocurrencies will likely perform in 2022.
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For many investors and even novices, cryptocurrency is synonymous with Bitcoin. In 2017, Bitcoin embarked on becoming one of the most prominent cryptocurrencies. It quickly rose to $19,497.40 in 2018 from $777.76 in 2017. In March 2020, Bitcoin recorded a 300% growth and outperformed gold.
At the beginning of 2021, Bitcoin witnessed massive gain before it encountered a humongous drip in May 2021. The price of Bitcoin was below $30,000 in May 2021 as China retreated from the crypto market. The rate of Bitcoin has been more or less $42,000 since the end of 2021 and still revolving around $42,000 at the onset of 2022. However, the coin crashed around $33,571 (24 January 2022) as crypto markets fell considerably, wiping off ~ $1 tn of investor money.
2022 is expected to be an interesting year as Bitcoin is expected to continue holding its prominence in the market. Many experts believe that it would outperform again in 2022, with many speculating that by the end of June in 2022, Bitcoin would reach $1,00,000.
With Ethereum (its equivalent counterpart) on popularity like never before and considered the best alternative to Bitcoin, exciting times lie ahead for investors.
Ethereum is primarily a decentralized network upon which various applications can be established. Ethereum is practically not a currency; it is ‘Ether’ that is being utilized as a currency.
Ethereum made a debut in 2015, and by 2018 its price rose to $1,400. In 2021, Ethereum soared 300%. Although we may come across the common debate on Bitcoin vs Ethereum, it has to be comprehended that they serve different purposes. Ethereum is only 2nd to Bitcoin in market cap trading at ~ $2,193 post-crash (24 January 2022).
Most experts believe this cryptocurrency to be the future, more than Bitcoin or any other crypto. 2022 can prove to be bullish for Ethereum; however, the exact performance is hard to predict. DeFi or Decentralized Finance plays an integral role when it comes to Ethereum. So, If DeFi grows in 2022, Ethereum is expected to follow suit.
Dogecoin (DOGE) and Shiba Inu coin (SHIB)
Besides Bitcoin and Ethereum, some other cryptocurrencies or rather a meme coins made rage on the market. Dogecoin, which started as a joke, pumped by Elon Musk and other online communities, touched a nearly high of a dollar in 2021 before dropping ~80%. Currently, it trades at $0.12. Tesla recently approved Dogecoin as a payment method. Despite the news, no considerable movement was observed in the coin, throwing ample light on its future.
Shiba Inu is no different from Dogecoin’s inception, pump, rise, and crash. This token, too, which began as a joke, trades today at ~$0.000019. How it holds in the future is difficult to predict. This is because while Dogecoin has Elon’s backing, the same cannot be said for Shibu Inu.
The cryptocurrency of this blockchain platform is SOL, released in April 2019. The popularity of SOL is due to its price, pace, and expandability. It is based on a system with no high computing power requirement.
It has been noted that SOL can regulate as many as 50,000 transactions per second. However, in September 2021, Solana went offline due to a rise in transactions. In 2021 SOL’s price skyrocketed, particularly in September 2021. Solana spiked 13,200% in just 8 mth. The initial price of SOL In January 2021 was approximately $1.61, and in September 2021, it became $214.36.
By the end of 2021, SOL has grown from $1 bn to $11 bn. It has already surpassed expectations and would perhaps continue to do so in 2022.
One of the fastest-growing blockchains is Cardano (ADA ). Cardano made a debut with a market capitalization of $600 mn in September 2017.
Today, the market capitalization of ADA was approximately ~ $31,078,822,595. Cardano was the sixth heftiest cryptocurrency by the end of 2021 and performed +691%. In 2022 it is thereby assumed that ADA would rise more than any of its earlier high, which was $3.03 (2021).
Polkadot is a platform blockchain that helps transfer messages while pooling their security. In brief, Polkadot is largely a heterogeneous technology. Polkadot’s price today is ~ $16.12, with a 24-hour trading volume of $1,41,73,19,391.
According to experts, DOT coin price would reach ~ $35 in Q1 of 2022, and the crypto can further continue the bullish trend, breaching $38 in Q2 and finally can gain ~ $44 by the end of 2022.
Polygon network (MATIC)
Polygon (Previously Matic Network) is majorly used for Ethereum scaling and infrastructure development. It effectively transforms Ethereum into a full-fledged multi-chain system.
Polygon price today is ~ $1.32 with a total supply of 10 bn. Based on forecasts, a long-term increase is expected, with the price prognosis for 2022 being ~$3.26, while for 2025, it might cross the ~$10 mark.
Ripple is a fintech company that, via its patented payment network, is providing payment solutions. XRP is the cryptocurrency that runs on Ripple Network. XRP Ledger is open source and is not based on a blockchain but rather on the distributed ledger database.
XRP price today is $0.563504 with a total supply of 100 bn. As per the recent predictions, by the end of the year, it could cross its previous all-time high price of $3.84.
The performance of cryptocurrencies in 2022 will be influenced by various international factors such as global appeal, government responses, regulations, competition, supply and demand, and more. Just the past week, the crypto market experienced one of its worst crashes, wiping out nearly $1 tn from the markets! The turmoil is expected to continue, which in real terms is not new for this market.
While the legal status of cryptocurrencies remains dicey with no clear global consensus, one can only hope for cryptocurrencies to rise in a world dominated by digital transactions.