How did Ethereum, Cardano and Co. perform in 2022?

The past year has been a real ordeal for many altcoin investors. Months of boredom are followed by price cuts and price hikes – more than once. After the implosion of Terra and the collapse of FTX, in addition to Bitcoin and Ethereum, all altcoins are also massively losing value. Cardano, Ripple, Solana and Co. step in and outpace the competition – depending on how current or developing they are. First, a distinction must be made in the definition. In addition to traditional stablecoins, most of which mirror the US dollar, there are exchange tokens that are currently experiencing a crisis of confidence. Meanwhile, classic altcoins are on an adaptation rally.

The most important altcoins

Gimbal (ADA)

Just a year ago, Cardano founder Charles Hoskinson prophesied: “2022 will be a crazy year”. If you look at the last twelve months from a technical perspective of development and adaptation, that’s it. At the start of the year, for example, Cardano saw massive address growth, while soon after Ethereum’s transaction volume was overtaken. The hunt for success continued in the months to come. Cardano has reserved approximately three million ADA wallets, provided a platform for 500 projects, and increased block sizes to scale even higher, better, and faster.

The big goal in 2022: The Hard Fork Vasil. Throughout the year, the developers worked diligently on the implementation and reached “significant milestones” as the ADA adaptation continued to progress. In September, the time had come: the network upgrade was successfully implemented. Blockchain is booming and experiencing strong growth. A study crowned Cardano the most popular brand in the crypto space.

Despite all the development progress, the ADA course has been losing value since the beginning of the year. The reason for this is likely the continued poor macro conditions and the collapse of the FTX. Exciting innovations await Cardano in 2023, which should make the network even more valuable to the crypto industry.

Solana (SOL)

The “world’s fastest blockchain” might be able to scale. But that doesn’t mean that Solana is also extremely reliable. Since the beginning of the year, the network has disconnected several times. For comparison: Bitcoin and Ethereum have never crashed in their entire history. The once lauded “Ethereum Killer” was also unable to shine with truly relevant developments. Only an exorbitantly priced smartphone was presented.

At least since the debacle surrounding Alameda Research and its founder Sam Bankman-Fried, one thing is certain: Solana is heading for a difficult 2023. The SOL course has not been spared by the crisis year 2022 either. Once at the top of cryptocurrencies, Solana now ranks far behind in the top 20 by market capitalization. There is a silver lining: Ethereum founder Vitalik Buterin promises a “bright future” for the competing blockchain.

Polygon (MATIC)

More efficient polygon. No other project was as bullish as cryptocurrency – and that in a bear market. Although the MATIC price has also fallen sharply, the adaptation in the real world – apart from Bitcoin, Ethereum and Cardano – is unprecedented.

The Layer 2 scaling solution for Ethereum is particularly welcomed by brands such as Nike, Starbucks, and Disney. In another success, the community recorded the first DeFi transaction from major US bank JP Morgan – via Polygon, of course. Even far from mainstream notoriety, the network is doing brilliantly. There are now about 200 million addresses. In 2023, the team wants to remain successful and speaks of “the most important year in the history of DeFi”.

Ripple (XRP)

At Ripple, all eyes are – always – on the Securities and Exchange Commission (SEC). The process has been ongoing since December 2020. The crucial question: is the XRP coin issued by Ripple a security? No deal has been reached in 2022 either. The SEC is partly responsible for this. The United States Securities and Exchange Commission has repeatedly blocked Ripple’s advances in court. More recently, the state body around boss Gary Gensler had important documents sealed.

Ripple is paying a high price for this. According to CEO Brad Garlinghouse, when it’s all over, the process will have eaten up more than $100 million. Meanwhile, the community remains tight-knit. The XRP price is also on a downward trend. However, it firmly maintains its place in the top 10 cryptocurrencies by market capitalization. The year 2023 will show whether the dispute can be definitively closed. However, the precedent will certainly have an impact on the crypto sector.

A comprehensive annual review of the largest altcoin, Ethereum, can be found here.

Exchange parts

Exchange tokens are designed to help stabilize protocols, settle transaction fees, or distribute rewards. Additionally, customers of the respective exchanges can save fees if they use the related tokens. Contrary to this real purpose, however, many exchange tokens only function as an investment in the respective crypto company. Investors are therefore speculating, as in the classic financial market, on the development of Binance, Crypto.com and Co. Little development is happening on token exchange networks anyway.

FTT, BNB and Co.

The collapse of FTX acted as a catalyst for the breach of trust. The associated FTT token has entered a death spiral and now ranks behind the top 200 cryptocurrencies by market capitalization. Meanwhile, Cronos (CRO), the Crypto.com token, also fell under the wheels. The crypto exchange has been battling bankruptcy rumors since the release of proof of reserves.

Only UNUS SED LEO (LEO) and the almighty Binance Coin (BNB) bravely hold their ground. Binance also faces rumours. However, the trust in the BNB coin seems to exist.

stablecoins

A stablecoin is a digital currency that tracks the value of another asset (like gold or fiat currencies). In principle, it can be any asset. Generally, however, stablecoins represent low-volatility assets. Most track fiat currencies, such as the Euro or US Dollar. As a result, their value is relatively stable compared to other cryptocurrencies.

USDT and USDC

Undisputed number 1 among stablecoins: USDT – or not? The cryptocurrency, which wants to chart the US dollar 1:1, will need some explaining in 2022. Following Terra’s implosion in May, there are calls for more transparency in stablecoin support. Although Tether denied a lawsuit from the New York Supreme Court that matched the claim, over the following months it focused on its image in the crypto scene.

Investors might breathe a sigh of relief in mid-October: USDT reserves are 100% backed by US government bonds. Investor protection was central to management’s concerns, it was said at the time. The stablecoin giant’s stumble benefited from competition – notably the USDC – gaining market capitalization and users. Growing competition helps the crypto industry and prevents monopoly positions.

From a development perspective, 2022 has been a success for stablecoins. USDT is now also available on the NEAR protocol and Apple has integrated USDC into the payment infrastructure.

You can read here how crypto gambling tokens have developed over the past 12 months.

Altcoin Outlook 2023

While the two biggest cryptocurrencies – Bitcoin and Ethereum – are expected to continue to lead, the battle between altcoins remains exciting. Cardano faces a year full of development. Polygon can boast of having strong partner companies. Both projects could fuel global adoption. Meanwhile, Ripple and Solana face a daunting task that must be mastered in the new year. It remains to be seen whether the prices of the respective altcoins will recover. In the crypto sector, investors must now be above all one thing: patience.

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