Have you been wondering… what is the best cryptocurrency to invest in 2022?
We sure have!
The rise of cryptocurrencies has been one of the most exciting and talked-about events in modern finance. Love them or hate them, you can’t deny that cryptocurrency has brought some fresh discussion to the finance world.
This article is hopefully one such discussion. Let’s get right into it…
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Background: Cryptocurrencies in 2022
Some coins, such as Bitcoin, seem to rise in value fairly consistently every year. However, other coins, such as DogeCoin, seem to dominate the conversation for a month or so before fading from popularity.
Due to this, it can be difficult to predict what the best cryptocurrency to invest in 2022 could be. But get it right and you could be rewarded BIG time.
After all, the world’s largest cryptocurrency (Bitcoin) was created in 2009 and has already risen over 19,000% in value. This puts it ahead of almost all of the best-performing assets in history.
Bitcoin’s market capitalization is currently sitting above $1 trillion!
This makes Bitcoin more valuable than all but a few of the world’s largest companies. Due to this, it can be easy to feel like you’ve missed the boat when it comes to investing in cryptocurrencies. However, this couldn’t be further from the truth.
The very first cryptocurrency was created just 13 years ago and cryptocurrencies remain far away from widespread adoption. So far, just one of the world’s governments has announced that they’ll accept Bitcoin as legal tender.
Despite a semi-slow start, cryptocurrency networks are becoming more mainstream by the day.
If anything, the current cryptocurrency environment feels similar to the early stages of the Internet. Just as many investors wanted to get into internet companies in the early-mid 2000s, lots of investors want to get into cryptocurrency.
With all of that said, let’s take a look at what the best cryptocurrency to invest in for 2022!
Disclaimer: As with any investment post, this is our own opinion and not financial advice! Always do your own research (DYOR) before making any investment decision.
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What Is Cryptocurrency?
If you’re a beginner to the cryptocurrency space then some quick clarification would probably be helpful.
Cryptocurrencies are a new form of decentralized digital money. By decentralized, I mean that there is no bank or government that controls cryptocurrencies. Instead, the tasks that go along with maintaining them are distributed among the users.
There are a few other characteristics of cryptocurrency that we’ll discuss when we talk about the first coin to invest in.
However, before jumping into the best cryptocurrencies to invest in (2022), there are two important things to note:
- There are currently over 6,000 cryptocurrencies in existence. As practically anyone can create a cryptocurrency, there’s a good chance that more and more digital currencies will be created each year.
- When it comes to investing, there is hardly ever a “right” answer. This is because the investment decision that’s best for you will rely on your own personal financial goals. It’s a little bit like how there’s no “right” college to go to. It can be quite a personal decision. With cryptocurrency, you may want a more “stable” long-term value store. On the other hand, you may be looking for a “double or nothing” risky investment with potential for greater returns. With pretty much all cryptocurrencies, prices are known for being volatile. Due to this, we always recommend making investment decisions based on your own due diligence and risk tolerance.
Bitcoin (BTC)
Bitcoin is the world’s most popular cryptocurrency and is currently the coin with the largest market capitalization. Market capitalization is a way of valuing coins and is calculated by multiplying the total number of coins by the value of each coin. Over the past 5 years, the price of Bitcoin has risen 8,700%. So far in 2021, Bitcoin’s price is up 115%.
There are a few reasons that investors really favor Bitcoin over other types of digital coins.
First, the creator of Bitcoin is completely anonymous. Although he/she sometimes uses the pseudonym Satoshi Nakamoto, this person (or persons) is completely unknown.
Although this might sound a little sketchy or suspicious, it actually is a good thing for Bitcoin. By nature, cryptocurrencies are supposed to be decentralized.
The fact that the creator of Bitcoin does not take an active role in its adoption is a good sign that they will not try to alter the code of Bitcoin anymore. Take note Elon!
Another reason that Bitcoin is so popular among investors is because the total supply of Bitcoin is capped at 21 million.
This means that the value of existing Bitcoins can never be devalued through the creation of new Bitcoins. This process actually happens frequently with traditional currencies and is known as inflation. Yep, i’m sure you’ve heard of that little money drainer. When an investor buys some Bitcoin, they can trust that more of this asset will never be created.
The same can’t be said of the dollar!
Finally, Bitcoin is by far the most commonly accepted cryptocurrency. Even though its price is still volatile, this makes it a top contender for the best cryptocurrency to invest in 2022.
Ethereum (Eth)
After Bitcoin, a close contender for the best cryptocurrency to invest in for 2022 is Ethereum (ETH). We have to admit, Ethereum has always been our personal favourite. Over the past five years, Ethereum’s price is up by over 36,000%.
In 2021, Ethereum’s price is up 422%. Additionally, Ethereum has the second-largest market capitalization after Bitcoin. This number fluctuates quickly but currently sits at about $450 billion! Current prices and updates can be found in our Ethereum Explained Simply article.
There are a few major reasons that Ethereum has risen to become the second-largest cryptocurrency in existence:
- Smart Contracts – Smart Contracts are like paper contracts except that they exist only on the blockchain. These types of contracts are programmed to only execute when all requirements are met. However, the biggest difference is that smart contracts do not require a third party. In this sense, it allows complete strangers to be able to trust each other while conducting business on Ethereum’s network.
- NFT Popularity – Non-Fungible Tokens (NFTs) are digital “tokens” that can be easily verified and are unable to be copied. Imagine that you owned a valuable original piece of artwork by Rembrandt that was verified by a professional and had a Certificate of Authenticity. NFTs are basically the digital equivalent of this. Due to this, they have surged in popularity over the past year and are currently changing the collectibles market. Everyone from YouTube stars to sports teams to celebrities has been thinking of new NFTs ideas that they could offer. Some of the top NFTs are also currently selling for millions of dollars. The famous Quarterback Tom Brady has even gone so far as to create an NFT marketplace. All of this takes place on Ethereum’s network, which adds validity and value to the coin!
- Ethereum 2.0 – The original Ethereum network had several faults that have since been addressed by Ethereum 2.0. This has given investors renewed confidence in the digital currency.
- FOMO (Fear Of Missing Out) – Ethereum is one of the only coins that investors think could ever surpass Bitcoin. Due to this, lots of investors who feel that they missed Bitcoin’s rally are buying into Ethereum, in hopes of a similar rally in the future. Viva La Flippening!
Cardano (ADA)
The biggest complaint of most cryptocurrencies is that they require an immense amount of electricity and power to operate. Even Elon Musk has spoken out – he loves cryptocurrency but questions their long-term validity due to this issue. Maybe a little bit hypocritical from a man with several private jets….
Anyway, Cardano is one of the newer coins working to solve this issue. When it comes to the amount of energy that different coins need to operate, this is how Cardano stacks up to its competition:
- Cardano: 6 gigawatt-hours
- Ethereum: 50 terawatt-hours (8x Cardano)
- Bitcoin: 130 terawatt-hours (21x Cardano)
Additionally, Cardano is capable of processing about 257 transactions per second. Bitcoin is only capable of processing 7 transactions per second. For this reason, Cardano is seen by investors as a more viable option for digital transactions.
Despite these benefits, Cardano does not quite receive the same level of media attention that some other cryptocurrencies receive. For example, its media attention is dwarfed by the next coin on this list…
If you are interested in finding a cryptocurrency that has a strong use case and is off most investor’s radar then Cardano is a great option for you.
Dogecoin (Doge)
Dogecoin was really started as a joke… who’s laughing now?
The inventors essentially wanted to mock cryptocurrencies by creating a coin that had a famous Meme dog for a logo. However, what started as a joke quickly amassed a cult following. Reddit traders rallied behind the coin and it quickly went viral, which sent its price soaring – to the moon!
Over the past year, Dogecoin’s price is up over 9,000%. It reached a peak of 69 cents per coin and currently sits at around 24 cents per coin.
Dogecoin became so popular that Dallas Maverick’s owner Mark Cuban even announced that Maverick fans could use Dogecoin to buy tickets.
Dogecoin has been out of the media recently. However, could the viral nature of the coin make it the best cryptocurrency to invest in 2022? If you have a knack for predicting price movements then there is the potential to make a lot of money in the short term.
Additionally, Dogecoin has already achieved adoption with the Dallas Mavericks. If other businesses start to accept Dogecoin then something that started “as a joke” could quickly become commonplace.
Bitcoin Cash (BCH)
This one’s a little bit out there once you look at the graph above!
In 2017, Bitcoin went through a fork that resulted in an entirely different coin being created. Bitcoin Cash is a slightly different version of Bitcoin that uses larger blocks. These larger blocks allow for more transactions to be processed and improves the general scalability of the coin.
Bitcoin was originally created to be used as a digital currency. However, as we saw earlier, the Bitcoin network can only handle so many transactions at once. This limits the capacity at which it could be used as a currency.
However, investors have still flocked to Bitcoin as a store of value (which has led to its increase in price). Bitcoin Cash was created in 2017 with the intention of being viable for use as a currency. However, despite its improved functionality, BCH’s price has not risen with the same ferocity as BTCs.
If you believe that cryptocurrencies are meant to be used as a digital currency in the long term (as opposed to an asset) then Bitcoin Cash is a great potential option for you.
The price of Bitcoin Cash spiked about 5 years ago in 2018 at $3,000 per coin. Since then, it has fallen by about 80%. The price of Bitcoin Cash currently sits at around $600 per coin. Will Bitcoin Cash make a triumphant return in 2022?
Other Cryptos To Consider
Before we end this review, we know that one week in the crypto market can feel like one year IRL so we wanted to leave you with 3 more altcoins to consider investing in.
Avalanche (AVAX)
Avalanche
$8.86
Avalanche is a layer 1 blockchain, which means it was once dubbed an ‘Ethereum Killer’. While it’s more likely that the future will be a many chain existence, what Avalanche does well is Defi (Decentralised Finance). Transactions are magnitudes cheaper than Ethereum and offer a higher number of transactions per second, which keeps it that way.
AVAX as it’s referred to, has a growing ecosystem including market making dapps such as Trader Joes, and proposes to compete in the gaming world too.
Backed by VCs and bigger investors, those coins bought in early fundraising rounds are now unlocked, and while this may contribute to selling pressure, there are no new surprises.
As of 2022 the fully diluted market cap is $45 Bn with a coin price of $117 per Avalanche crypto token. This is 1/10th of the market cap of Eth, and while it does not have the network effect of the big name it does have amongst the most total value locked in it’s Defi smart contracts and is likely to be around for a while to come.
Polkadot (DOT)
Polkadot
$4.04
Polkadot is the work of Gavin Wood, a former founder of the Ethereum foundation. Polkadot and it’s incubation network Kusama, is focused on the goal of interoperability in web 3. This means, it’s not an Ethereum killer, it ‘s an Ethereum integrator. Using Polkadot, apps on one blockchain can integrate with another with ease.
It is still early days, and development work has only really been seen on the Kusama ‘canary chain’ up until December 2021, but longer term, Dot could be the ultimate long term play.
Valued as one of the big caps in the cryptocurrency market, as of December 2nd 2021, the token price of DOT is $36 and there is a fully diluted market cap of $40 Bn. This fully diluted market cap figure relates to how much the project is worth if you consider the total number of tokens that could be released. It is potentially a metric for establishing a true stated price. It is certainly something we look at if we are gauging if a token is over priced in the near term. If there are still 9 x the amount of tokens to be released into the market, then the price could see some serious downward price pressure, unless it is hugely undervalued.
Worth knowing…
Solana (SOL)
Solana
$19.51
The leading ‘Eth Killer’ is probably Solana as of early 2022. It has a functional ecosystem, including gaming, DEFI, NFTs, is incredibly cheap to use and can handle tens of thousands of transactions per second.
Interestingly, Solana transactions use the same energy as just two Google searches. Perhaps we should ban Google instead!
Solana has VC backing, which has made it less popular in some crypto circles, from those who reject ‘Trad Fi’. In addition to this, it has taken some flack as in order to process transactions as quick and cheaply as it does, it uses fewer validating computers. These computers, known as nodes are many times more expensive than a Bitcoin node due to the power and size of their computing function. Therefore the argument is, that Solana is not as decentralized as other chains. That being said, if you are using a blockchain for gaming, it may not need to be as decentralized.
Currently priced at around $228 per coin as of December 2nd 2021, the Fully Diluted Value (FDV) is $64 Bn. It’s taking a lot of business from Ethereum, and it’s thought that there is the potential for this coin value to run long term.
Where Can I Buy Avalanche, DOT And Solana Coins?
AVAX coin is available to buy on Binance, KuCoin, FTX and Coinbase Exchange. Check out our offer link on Coinbase for new registrations if you wish to add Avalanche to your portfolio. DOT or Polkadot coin can be bought on nearly every exchange except for Gemini and FTX.
Solana coin can be bought on many of the big exchanges except for Gemini and as of 2022 Grayscale the world’s largest Bitcoin fund, announced it would begin creating a Solana fund.
Verdict: Best Crypto to Invest In For 2022
We hope that you’ve found this list of the best cryptocurrencies to invest in 2022 to be valuable!
Whilst it’s impossible to declare any of these cryptocurrencies the clear winner, we always try to offer our readers an opinion.
Personally, if we had to choose the best cryptocurrency to invest in for 2022 then we’d have to go with…(drum roll)…. Bitcoin!
Bitcoin has been around the longest and has already proven that it has very strong “staying power”.
Thousands of articles have been written slamming the coin, countries have tried to ban it, and financial analysts have written it off. Despite all of this, the price of Bitcoin has continued to rally time and time again. Although the future is never certain, this track record of success makes Bitcoin the best cryptocurrency to invest in 2022 (in our opinion).
That’s not to say we won’t personally be investing in other cryptos. Alongside Bitcoin we will also be investing in a couple of “hail mary’s”. New projects with the potential for huge growth (but also losses). Our article on the best altcoins to invest in 2022 covers this in more detail. We are also big fans of Ethereum and continue to DCA (Dollar Cost Average) into Eth every single month.
Remember that when it comes to investing and making financial decisions, it will always be up to you to click the buy button. Never invest more than you can afford to lose.
What do you guys think is the best cryptocurrency to invest in 2022?
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14 thoughts on “Best Cryptocurrency To Invest In 2022”
Hello everyone, just wanted to say that crypto changed my life and it could change yours. We are investing in all of the crypto’s above and more. but we recommend doing your due diligence to really know what you’re investing in. Be lucky!
Hi, New reader but have subscribed to the newsletter. What do you think of Litecoin? Thanks!
Hi John, awesome, thanks! We talk about Litecoin a little in our ethereum explained article here https://firetheboss.com/invest/cryptocurrency/ethereum-explained-simply/
:)
Great article. Where do you recommend keeping your cryptocurrency?
Hi Ben. Initially, most people keep them on exchanges but when you have a reasonable amount invested you should really be looking at hardware wallets. These allow you to “take your coins offline” and therefore reduce the risk of scams/theft. Make sure you don’t lose you password/seed phrase though! Thanks :)
How many cryptos should you invest in? Or should you just invest in the best/”top” coin?
Hi there, Completely up to you! Bear in mind that a large number of projects went to zero in the last bear market and this could happen again. A diversified portfolio is therefore a great idea, but over-diversifying could be a mistake if it means you have too few of each coin to make any significant profit. We tend to aim for large cap coins as the majority of our portfolio with a few newer alt coin projects around the edges. Best of luck!
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Awesome!!!! Can you do one on NFT’s?
How about this one? https://firetheboss.com/invest/cryptocurrency/beginners-guide-to-nfts/
Have you heard of a new Utopia USD stablecoin and its privacy coin crypton? I think it will equally compete with many popular coins. The market is changing and I’m sure it won’t beat Bitcoin, but will take it’s leading place in a certain niche.
Is this a scam?
Interesting… that’s a new one for me but will take a look.
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