What's the next cryptocurrency to explode in 2022?

Cryptocurrency may have started out as a Wild West of investing dominated by mavericks, but it is now firmly established in the financial mainstream. Institutional investors and major banks are treating it as an important asset despite recent volatility and regulatory crackdowns in China and elsewhere. If you need evidence of the extent of the volatility, consider this: As of April 11, Bitcoin's value has ranged from $28,893.62 to an all-time high of $68,789.63 over the past year.

Despite this high volatility, many cryptocurrency investors are still looking for the next big gain. Which cryptocurrency is ready to explode? If you're looking to start buying cryptocurrency, you may be wondering: which one will have the greatest return potential?

While Bitcoin may be the obvious choice, it's not necessarily the best bet in 2022. Your chances of making big gains may be better with a smaller coin that hasn't already been pumped up by institutional investors the way Bitcoin has been. 1. Ethereum (ETH) Ethereum, commonly known as ether, is the second largest cryptocurrency in the world after Bitcoin, and has even recently surpassed Bitcoin in terms of price gains, CoinTelegraph reported.

Last year, Ethereum created a major upgrade that included reducing the supply of ether, which currently stands at  120.33 billion coins. The upgrade also allows the Ethereum network to handle more transactions per second, improving the scalability of the platform and lowering transaction fees.

Compared to Bitcoin, Ethereum lacks scarcity – Bitcoin has a maximum supply of 21 million coins – and widespread acceptance by businesses and governments. However, unlike Bitcoin, Ethereum is not just a store of value. It is also an infrastructure on which applications can be built.

Other cryptocurrencies are issued on Ethereum, which serves as the basis for decentralized finance. Binance Coin (BNB) Binance is the most successful cryptocurrency exchange in terms of trading volumes. Like Bitcoin, Binance Coin maintains a strict limit on the number of tokens in circulation – in its case, 165,116,760 tokens.

This helped the token price increase significantly in 2021. Additionally, Binance puts about a fifth of its profits each quarter into permanently phasing out or “burning” BNB tokens, raising the value of the remaining tokens. Binance has two types of blockchains, which reduce the bottlenecks experienced by Ethereum.

It's also fast and scalable, and Binance is working to make the platform more regulator-friendly, according to Seeking Alpha — a feature that could be crucial to its viability and widespread adoption. Additionally, Binance is launching Bifinity, a fiat-to-crypto payment platform that will help merchants prepare to accept digital assets as payments, CoinMarketCap reported. The payment processing platform supports more than 50 cryptocurrencies.

3. Tether (USDT) Tether is a type of “stablecoin” designed to provide a less volatile alternative to Bitcoin because it is tied to another asset. In the case of Tether, that asset is the US dollar. In terms of valuation, Tether has a 1-to-1 ratio with the dollar, which means it is less speculative than cryptocurrencies like Bitcoin and Ether.

With a market capitalization of $82.57 billion, it is the largest stablecoin and the third largest overall. The big advantage of Tether is that it allows you to make transactions in traditional currencies instead of having to dive into complex cryptocurrencies. You can also lend it to cryptocurrency platforms for double-digit interest rates (annual) without worrying about volatility wiping out your profits.

4. Decentraland (MANA) Decentraland is a virtual reality game on the Ethereum blockchain that uses the MANA token as in-game currency. Users can purchase goods and services, purchase lands, visit other players, as well as create and monetize their own content.

MANA's current price of $2.12 represents an increase of about 385% from its 52-week low of 43.68 cents. MANA is the largest gaming cryptocurrency by market cap. Although it has competition from the likes of The Sandbox and ApeCoin, the in-game assets are expensive – plots listed on Blockee show 

Prices range from several thousand dollars to over $22 million – but they have some benefits that can push the token forward. For example, users retain ownership of the digital assets they create in Decentraland and can convert them into cryptocurrencies other than MANA. 5.

Algorand (ALGO ALGO), founded by famous computer scientist Silvio Micali,  has positioned itself as a competitor to the Ethereum blockchain. It is used by hundreds of companies, according to Securities.io, and got a big boost last year when El Salvador said it would build blockchain infrastructure using Algorand.

Recently, venture capital firm Borderless Capital launched a $500 million fund to invest in digital assets that support decentralized applications on Algorand, Blockworks reported. The Marshall Islands' central bank digital currency, Sovereign (SOV), also uses Algorand. One of ALGO's biggest advantages is its “Proof of Stake” algorithm, which provides a high degree of security, scalability, and requires less electricity than Bitcoin and other platforms.

This feature will only increase in importance as cryptocurrencies face more criticism – and potential regulation – for their massive energy consumption. RenderToken (RNDR) RenderToken is a graphics rendering network that allows miners with excess GPU bandwidth to distribute it to artists and creative studios that need additional computing power.

RNDR is the original token creators and miners 

who use it in their transactions on the RenderToken network. RNDR went public in 2017, but recently got listed on the Coinbase exchange. Although highly speculative, RNDR could benefit from the increased exposure it gets on Coinbase as well as the extraordinary rise of non-fungible tokens for digital art.

How to Spot the Next Big Cryptocurrency Before knowing which cryptocurrency might be the next big winner, it helps to understand why many investors gravitate toward cryptocurrency in the first place. Much of this has to do with a fundamental change in how digital assets are viewed, says Jeff Dorman, chief investment officer at Arca, a financial services firm specializing in digital assets. “I believe we are in the early stages of a secular, multi-decade shift toward digital assets, where the evolution from an analog to a digital world has shifted forever due to COVID-19,” Dorman told GOBankingRates in an email.

He says this asset class has “now evolved beyond cryptocurrencies” into decentralized finance, NFTs and other investment vehicles. Profit and Gains from Crypto When trying to identify the next big cryptocurrency, there are two things to watch that are similar to what a stock investor would watch: market cap and price. Market capitalization shows the amount that has been invested in a particular network.

As a general rule, the higher the market cap, the more stable the asset is, although it also means that the currency has less room to grow. It is also important to monitor the price to determine whether investors are bullish or bearish on the cryptocurrency. Other Key Metrics Here are some other metrics that can help you evaluate a crypto: Volatility: The less volatile the price is, the better the value of the cryptocurrency will remain.

24-hour trading volume: The total dollar value of all transactions over the past 24 hours can help you determine the liquidity of a currency. Supply: As Bitcoin's meteoric rise attests, scarcity can drive up demand and prices. An increasing or endless supply can have a dampening effect.

How can I buy cryptocurrency? Open an Account with a Cryptocurrency Exchange or Broker You'll have to open a trading account, just as you would with stock trades. You can go through cryptocurrency exchanges like Coinbase, Binance.US, and Gemini, which match buyers with sellers, or choose a broker like Robinhood and SoFi, which executes the trades for you.

Exchanges usually have low fees, but feature complex interfaces. Brokers have much simpler interfaces but may charge higher fees and offer a limited selection of coins. Fund your account Before you can trade cryptocurrencies, you will need a way to pay for your purchases, such as a linked bank account, bank transfer, or debit or credit card payment.

Place your cryptocurrency order Select the cryptocurrency you want to purchase and select the number of coins you want to purchase. To buy fractional shares of cryptocurrency, specify a dollar amount instead of the number of coins.