What cryptocurrencies to invest in? Top 5 cryptos for 2022

1. Bitcoin

Number 1 since its launch in 2009, Bitcoin (from its symbol BTC) will probably remain the unbeatable and essential crypto-currency to have in your investor’s portfolio. Even if it is not the crypto that will make the biggest multiplier, it is unlikely that in a few years the price of Bitcoin will be multiplied by 100, it is the one that will best resist the fall and volatility. Bitcoin represents between 30 and 70% of the total capitalization of cryptocurrencies depending on the period.

Its goal is to be a global means of payment, usable by anyone and uncensorable. Currently, Bitcoin is rather considered and used as a store of value. El Salvador 🇸🇻 has been using it as its national currency since September 2021!

Advantages:

• Gives the market trend and has quite low volatility compared to others
• Thousands of developers are working on it
• Accepted by many (e)merchants as a means of payment
• Most famous cryptocurrency with very high liquidity
• Significant decentralization
• Almost impossible to take control of the network

Disadvantages:

• Developments that may take time
• Transaction costs that can be significant in case of high use

2. Ethereum

Ethereum and its ETH token has been around for many years (2015), launched by Vitalik Buterin this cryptocurrency has a solid foundation, many fans and an active developer community. Thousands of projects are created using this blockchain which has enabled the rise of smart contracts, decentralized applications, decentralized finance ( DeFi ), NFTs as well as DAOs (decentralized autonomous organizations). Many innovations often appear first on Ethereum. Its goal is to be a decentralized world computer, allowing anyone to use decentralized applications.
A transition is currently underway, Ethereum will evolve from mining via proof of work to mining via proof of stake (PoS).

Advantages:

• Tens of thousands of developers work on Ethereum
• Very strong network effect
• Develop new innovative concepts
• Allows you to support many fundraisers
• Support for many trends such as NFT or DeFi

Disadvantages:

• Extremely expensive transaction fees
• Decentralization is often singled out

3. Avalanche

A more recent cryptocurrency, it dates from 2020. It is a network that has a unique consensus that has brought many new things. Avalanche and its AVAX token use proof of stake (PoS) to validate transactions, making it a low-energy network. Just like Ethereum, the Avalanche crypto allows the establishment of smart contracts and the development of decentralized applications. We also see the same type of developments there: DeFi, NFT… On the Avalanche blockchain, the number of transactions carried out per second is much higher than on Ethereum.

Advantages:

• A strong team and partners
• A promising technology accessible to Ethereum developers
• Anyone can vote to influence the network
• Interoperable network and allows you to customize many things

Disadvantages:

• Few differences with Ethereum in terms of applications
• The complexity of use which can hinder users

4. Solana

Blockchain supported by FTX and Sam Bankman-Fried, this crypto-currency has a very important strike force (funds). Solana and its SOL token bring a new consensus system with the Proof of History (PoH) which has its own advantages but also its disadvantages. Transaction fees are very interesting because they are close to 0. There are many uses related to those of Ethereum with everything related to decentralized finance or NFTs. Some problems marred the network, several times it was impossible to carry out transactions for long hours.

Advantages:

• SBF and FTX are part of the partners
• Ultra-fast transactions with virtually no fees

Disadvantages:

• Very little decentralized: in terms of nodes and distribution of parts ( corners )
• Network interruption problem due to network structure

5. Polygon

The Polygon network was formerly called Matic Network. MATIC still remains the name of its token. Polygon is a layer 2 ecosystem, ie a second layer, on top of Ethereum to improve its speed and transaction costs. We should rather talk about sidechains because Polygon has its own security system via PoS (proof of stake). Polygon’s goal is to be a multi-chain ecosystem, i.e. linked to many other blockchains.

Advantages:

• Backed by Coinbase and Binance
• Fast and low-cost transactions
• Many decentralized applications of Ethereum are present on Polygon

Disadvantages:

• Little decentralized: in terms of validating nodes
• Network congestion issues

🤔 ” Investing in top 10 cryptocurrencies is good, but that’s not how I’m going to get rich…”

The more crypto is capitalized, the lower its growth potential. Some highly capitalized assets can have good returns, especially when the overall market rises sharply. It is true that once crypto enters the very closed circle of large caps (the top 15/20), positive 3-digit variations are less frequent. This does not mean that you absolutely have to invest in small cryptos, it is important to diversify and secure yourself on large capitalizations like Bitcoin for example.

But rest assured, there are more than 10,000 cryptocurrencies. So if you want to find the next nugget that will explode and improvise your treasure hunter, you’ll have plenty to do. This is called poorly capitalized or low cap cryptocurrencies 🙂 Investing in this type of asset is very very very very very […] very very very risky. You have been warned. These cryptos can be manipulated and their price can suddenly rise or fall very sharply for no apparent reason. Some may just be scams. Thus, you will have to learn about the project, its relevance and its operation to be able to detect the red flags 🚩 and only invest in reliable cryptos. There are no longer any laws or morals, you are on your own in a ruthless universe 🙂 It is of course here that you will be able to make the best moves. If you spot the potential of a 300th-ranked crypto before it explodes and joins the top 30, it’s a guaranteed jackpot. This is called: hidden gems 💎 (hidden gems).

When we talk about mid- cap cryptos, we are talking about the top 100 or so. The further down one goes in the top 100, the lower the volumes traded; this means that there are fewer and fewer traders interested in these coins . There we are starting to be on really very risky projects that could disappear overnight. They are therefore aimed at an informed public.

When we talk about low capitalization cryptos, we are talking about cryptos ranked from 101 to 5000 or so. There, we really fall into a particular category of asset 🙂 There is no longer any law or morality, you are left to your own devices in a ruthless universe 🙂 It is of course here that you will be able to make the best moves . If you spot the potential of a 300th-ranked crypto before it explodes and joins the top 30, it’s a guaranteed jackpot. This is called: hidden gems 💎 (hidden gems).

Example of a nugget: ChainLink (LINK) with +1870% between June 2018 and June 2020, rising from 111th to 14th place in the ranking. Then its course was almost multiplied by 5 between June 2020 and February 2022.

In the rest of this article, we give you the weapons to analyze the best projects and allow you to make the best moves. But before that, it’s good to remind you how to invest in cryptocurrency. 🙂

How to invest in a promising cryptocurrency?

There are several methods available to you for trading cryptocurrencies. There is no one platform that is better than the others, it will just depend on your personal preferences and of course the cryptocurrency you want to get hold of. If you want to trade and speculate on the value of these crypto-assets without owning them, you can use eToro.

There are plenty of other specialty sites where you can invest in smaller cap cryptos.

Binance

It is the reference platform all over the world! You will find hundreds of cryptocurrencies there, from the biggest caps like Bitcoin to the smallest ranked in the top 500 caps. It is used by millions of crypto investors.

FTX

It is the competitor of Binance, more and more users are registering on this platform to obtain hundreds of cryptocurrencies available for purchase and sale. It is the second largest cryptocurrency exchange in the world.

Many crypto-currencies are not present on the platforms that we have just presented them to you. Thousands more are available on more exotic and less trusted centralized platforms or decentralized exchange (DEX) platforms.

Our video to find out which cryptocurrency to invest in

In this video, we give you many tips and tricks to determine for yourself if a cryptocurrency can be promising.

Cryptocurrencies follow trends, if you manage to anticipate them, follow them and get out before the rest of the market, it will be a jackpot. For example in 2020 and 2021 we had the fashion for DeFi , what is called decentralized finance and which allows anyone to have access to financial services without any limitation. Hundreds of crypto projects have emerged and are engulfed in this trend. This type of project represents a good part of the top 100 in 2022.
From the summer of 2021 on 2022 the hype (trend) of the moment is on the side of NFTs and metaverses. Many projects related to this have seen their prices explode and can represent great investment opportunities.

Avoid scams

Do you want to invest in crypto but you don’t know if it’s the right time and if the project is worth it? The universe of cryptocurrencies is vast and complex. It is therefore important, in order not to make mistakes, to follow a few simple principles when investing. The purpose of this part is to expose the key elements to analyze so that you are able to detect a promising cryptocurrency and a high potential of a cryptocurrency doomed to failure. Some of the points exposed below may seem obvious to you but it is always good to remember them.🙂

More than investing in a doomed project, you should know that the world of crypto-currencies is often compared to the Wild West because of the number of scams and the lack of existing regulations ( even if this environment begins to be more and more regulated). The inherent complexity of this field means that many unscrupulous people are ready to take advantage of the lack of knowledge of others to enrich themselves. Don’t be a victim, get informed!

⚠ If a project guarantees you a return on investment of a minimum amount or it encourages you to invite many users to earn more, it is probably a ponzi scheme. It can grow very quickly and make you money, but it will inevitably collapse when there are no more new entrants and you will lose all your investment .

There are a lot of scams out there, don’t be fooled by false promises, and don’t blindly follow other people’s advice.

Trust your first impression

As in real life, the first impression rarely leaves a second chance. The project in which you wish to invest must appear irreproachable at first glance so as not to scare away potential investors. Start by analyzing the name and logo of the project in question. It may seem harmless, but if the logo is of poor quality, it can say a lot about what happens next… The market is very sensitive to marketing and communication ., if the project does not reflect a professional image, investors will be more hesitant and your investment may not yield the expected results. Be careful, however, not to give too much importance to this criterion. Projects with beautiful logos, a beautiful site and beautiful promises can of course turn out to be wobbly projects.

💡 Try to push your investigations further than just the name and logo, some seemingly uninteresting projects could turn out to be very good investments.

Website

The website is the showcase of the project. How could a team carry out a technical project related to the blockchain if it is not able to achieve a quality website? You should be able to find all the resources you need there, it is the nerve center of your research.

Typically, a crypto-related project website will give you access to the following resources:

• Information related to the project (objectives, white paper, roadmap, distributions of tokens or tokenomics …)
• Team Members and Advisors
• Social networks
• Latest news
• Project history (launch date, ICO…)

⚠ A beautiful website and significant activity on social networks does not mean that the project is of good quality and that you can go for it with your eyes closed. Some projects spend a lot of money on looks to make people want to invest. But that is not enough, it is essential to examine the substance of the project in order to see if it has a real interest.

Project

In this part, I will tell you about the important points to analyze concerning the project in which you wish to invest. The latter must have a clear direction and tackle a well-identified niche. To help you in your analyses, you will have to rely on the white paper and the roadmap of the project.

white paper _

This is a practical guide of a few pages dedicated to the presentation of a project or a crypto-currency. White papers are mainly used to convince interest in a project. It is essential to read the white paper of a project in which you wish to invest in in order to fully understand the issues and the feasibility. The white paper is very often available on the cryptocurrency website. For the most knowledgeable, the white paper will make it possible to analyze in depth the technology of a project to detect its possible potential.

Roadmap _

The roadmap makes it possible to graphically materialize the important milestones to come in order to carry out a project. This is a clear and precise action plan of the main stages on which the team must work and the estimated time to achieve each of these stages. If a roadmap exists, check that it is respected and updated. If you see that the first milestone is already 6 months late, that’s usually not a good sign for what happens next…

Product/project analysis

Start by comparing the product or service you want to invest in with other existing products and see if another project already covers this niche or not. If one or more products are already in the field, that’s not necessarily a bad thing. Ask yourself if the product in question offers to solve a real problem, what does it do more, less, better or worse than its competitors if there are any. This is an overriding question that can be quite difficult to answer. It’s about finding out if the product can solve a big enough problem that people are willing to give up current technology to use it. Ask yourself if the use of blockchain and cryptocurrencies has a real interest, or if it will only allow the creators of the project to enrich themselves.

Run away from false good ideas!

• A product that is too far ahead of the market
• A product that does not meet an urgent and important need
• A product that is not practical to use

What is the actual size of the market? The growth potential of a market is a key element that should not be overlooked. Even if the project you want to invest in is a niche market with a strong team and a bunch of other positives, you should always ask yourself if the target market is big enough. Bitcoin aims to be a global currency and has immense growth potential. But can we say the same about a currency for purchases of items in online games or a currency for dentists?? ? No. The gaming industry as a whole was estimated to be around $100 billion in 2016. This cryptocurrency would sit on a subset of this industry, which is obviously smaller. Keep in mind that putting your money in a market that is 10 or 100 times bigger will give you a much higher potential return. However, it should always be kept in mind that a “niche” cryptocurrency could very well increase in value.

To go further, some questions to ask yourself about the project/product:

• What will it be used for? Does it bring a real novelty? What are its objectives?
• Has a working product already been created or is it just an idea?
• Is cryptocurrency capable of supporting thousands of transactions per second?
• Is Cryptocurrency Shabby?
• How many tokens or coins were pre-mined before launch?
• How and how often are new tokens or coins issued?
• Does the project team own too high a percentage of the cryptocurrency? From 30-40% it starts to be very high . Same for private sales or seed investors, how much crypto do they own, and are they stuck for a while (can’t sell)?
• Do we know the maximum number of coins in circulation ( total supply ) or is there no limit?
• Is the product open source? It is preferable that the technology be freely available (open source) so that it can be analyzed by other developers outside the project. This will help the project become stronger and more secure over time.
• Is the code available on GitHub? A platform that allows you to follow the developments of an open source project.

🔍 GitHub Focus: You don’t need to understand what updates are, just make sure updates are made regularly. If there have been no updates for 3 years or it is always the same person updating the GitHub, there may be something fishy… The Chaincoin project is the very example of a scam that can be avoided by looking at the GitHub. The only code updates to the Chaicoin project in the past 3 years are for a name and logo change. It can be deduced that it is a simple Bitcoin clone.

Project leaders

In this part I will tell you about the project leaders, namely: the team, the advisers and the company.

Team

Who are the team members? You can have the best idea and the best project in the world, but if the team is not competent, nothing will come of it. I have listed below some questions to ask yourself to do a quick analysis on the team of a project.

• What is the size of the team? What is the average age of members?
• Are the profiles of the team diversified (developers, marketing, etc.)?
• What is their experience in business creation, in blockchain, in project management?
• Have the promoters of the project already been at the head of companies valued at several million dollars?
• Are their LinkedIn profiles available on the site?
• Haven’t they been involved in scams?
• A quick Google search of the main members might reveal information that would question their legitimacy or might convince you that the project has a bright future ahead of it.

💡 Feel free to do a quick Google search for key team members. Who are they ? Are they as well known as the project site suggests? If someone known is part of the team, find out if he has validated it publicly or ask him the question directly (social networks, e-mail…). Always double check the information you read.

Advisors _

Having advisers who have already proven themselves can greatly affect the image and credibility of a project.

Ask yourself these 3 questions:

• Do advisors support the project?
• Are they officially presented on the site?
• Do they have solid experience?

💡 Do not hesitate to contact these advisors to ask them if they support the project well. Many scammers display known advisors to deceive people

Company

• What is the company behind the project? Is there one? Was it an existing company? Who has already proven themselves elsewhere? Or is it a company created to measure to carry out the project?
• Is the company behind the project transparent?
• Is it backed by reputable investors?
• Does it publish its financial statements? The use of its cash and income?
• Does she own any patents? Trademarks?

Communication & Community

Are team members reachable on Slack, Telegram, Twitter, Facebook, Discord…? Or at the very least, are they reachable via a contact form or an e-mail address on the site?

💡 In general it is quite easy to contact the members of the team of a crypto project, do not hesitate and do not hesitate to ask your questions 🙂

The analysis of social networks allows you to have an overview of the communication skills of the team behind the project and also to know if the project is supported by a large community or not. The number of Twitter subscribers or members of a Telegram channel should not be a decisive indicator because it is quite possible to buy fake members.

Analyze project team communication

This is what will create the hype. Knowing that in cryptos the hype is very important, if the team is not talented in communication, the project could well remain in the shadows. If they regularly publish news on their blog, or on a SubReddit, or on a topic dedicated to cryptocurrency on the Bitcointalk forum, that’s a good sign.

Analyze community and dynamics

• Is the project supported by the community?
• How big and active is this community (compared to the rest of the market)?
• Are people involved in the project, suggesting improvements?
• Is the project active on social networks? Facebook, Twitter, YouTube…
• Is the community active on social networks? Twitter, Facebook, Reddit, dedicated forum…

Here is the list of the most used social networks in the world of cryptocurrencies and the indicators to analyze for each of them:

• Bitcointalk (specialized forum): analyze the dynamics of the forum on the bitcointalk.org thread (number of pages on the project, reputation of editors, frequency and quality of messages, etc.)
• Telegram: do people participate, ask questions, offer help, improvements…
• Discord: is there activity?
• Facebook: number of likes, number and frequency of posts, community activity…
• Twitter: number of followers, number and frequency of tweets, the relevance of tweets…
• Reddit: number of subscribers, number of users online, quality of posts, subreddit activity…
• Slack: active participation of the project team, active support from the community…
• Medium (Specialized blog): quality of articles, number of likes and shares…

💡 Do not hesitate to search for articles on the project in which you wish to invest, always paying attention to the credibility of the sources.

The involvement of the community on the various social networks mentioned above is a good sign for the project. If there is a slack, a Telegram channel, subreddit or any other medium that is active, it contributes to the project (as opposed to channels where it is only about price movements) and it is a good indicator of hype.

The specific case of fundraising such as ICOs, IDOs, IEOs…

From the birth of the idea to the introduction of tokens on the exchanges, it can happen a lot of times and a lot of things. The year 2017 will have been marked by the democratization of ICOs with millions of dollars raised each month. The following years were marked by major regulations to avoid scams as much as possible, in particular with the arrival of an AMF visa which certifies the most convincing ICOs.

💡 An ICO (Initial Coin Offering) is a fundraising method used to launch projects related to crypto-currencies and blockchain. During an ICO, investors can buy tokens, which is similar to buying shares in a traditional company. This allows the project to raise funds, and it allows investors to take part in the project and speculate on its future value.

Many other methods for raising funds then appeared such as IDOs, or IEOs which allow funds to be raised via decentralized or centralized platforms.

When you want to invest in crypto, it might be worth looking in the rearview mirror and looking for this information:

• When was the idea born? Several weeks, months, years ago?
• Has the project performed an ICO/IDO/IEO to raise funds? How much was raised? How long? Was it a success or a failure?
• Did the team keep too many tokens or coins for themselves?
• How many people participated? Do a few participants own almost all of the crypto in circulation?

This allows you to have an overview of the enthusiasm around the project even before the first developments are made. I choose not to dwell on this part, a specific chapter on ICOs is available on the site.

Prices, Market Cap & Exchanges

In this part we will see 3 essential points to analyze when you want to invest in a crypto-currency: the price, the market cap and the exchanges.

Course

It is essential to study the price curve of a crypto before investing. You must observe the trends: pumps/dumps, short-term evolution (over a few days/weeks), medium term (over a few months) and long-term (over several years)… A guide dedicated to trading and analysis technique is available on Platforms, it will allow you to better analyze curves and anticipate market developments.

See if the daily volumes are significant. If the volume is low, it may mean that the crypto has not yet been detected by the market, it may also mean that it is a project that does not attract particular interest from the part of the market. investors. This also means that its price is easily manipulated by a few people .

⚠ Always pay attention to trading volumes when investing in cryptocurrencies. If the daily volume of a crypto is a few tens of thousands of dollars (or even hundreds of thousands), it can be very risky to invest because you may not find buyers at the desired price when it comes time to sell.

Market Cap

Market cap is the estimated total value of a cryptocurrency. It is calculated by multiplying the number of tokens in circulation ( circulating supply ) by the current price of the token. It is often expressed in dollars and it is a very good indicator to compare the value of several cryptocurrencies. Indeed, since cryptos do not all have the same number of tokens in circulation, comparing only the price does not make sense.

In 2018, Ethereum was trading at almost the same price as Dash: around $280 per token. However, Ethereum was much more valuable than Dash because there is much more ether (ETH) in circulation.

Ethereum: 95.5 million tokens
Dash: 7.5 million tokens

Even though these 2 cryptos are trading at the same price, Ethereum’s value is estimated at around $27 billion (95,500,000 x 280) while Dash’s is estimated at around $2 billion (7,500,000 x 280).

The lower the market cap of a currency, the higher its potential but also the higher the risk. I advise you to use the CoinMarketCap or CoinGecko site to see the ranking of cryptocurrencies and have access to a lot of useful information: market cap, price, volume, number of tokens in circulation…

It is also important to consider the marketcap in the event that all tokens are issued. Thus, if the marketcap of a crypto is 1 billion dollars with 1% of the tokens issued, if all the tokens are issued and these keep their price then the marketcap of the crypto will be 100 billion dollars.

Exchanges

It is important to look on which platforms the crypto-currency you wish to acquire is exchanged. If it is available on recognized platforms such as Coinbase, Kraken, Bittrex, Poloniex, Bitfinex, or Binance, this is often a guarantee of seriousness. It should be noted that being listed on a top exchange is very expensive and requires lengthy procedures. On the contrary, if the cryptocurrency is only available on platforms like EtherDelta, CoinExchange or IDEX, think twice before investing. Not that these exchanges are not serious, but they are known to list a very large number of crypto-currencies according to much less restrictive criteria than the platforms mentioned above.

Our advice before investing in cryptos

The past shows us that there is usually a hype that forms around a project before an important event, and that very often, two or three days before the event, the price begins to fall. If the project makes sensational announcements during this event, the price will explode, otherwise, it should remain relatively stable or even fall significantly if the event does not meet investors’ expectations.

💰 Buy the rumors, sell the news 💰Either way, it may be worth adopting an investment strategy tied to upcoming crypto events. For this, I recommend the site CoinMarketCal.com This is a collaborative calendar allowing you to keep informed of future crypto events.If a conference is planned by the team of a crypto project and the rumors are rife about possible important announcements, it may be interesting to ask a post about this crypto (if it has not already made a + 200% in 3 days)! In general, a FOMO (Fear Of Missing Out) is going to happen and you could have a good return on investment by selling a few days before the conference 🙂

⚠ Watch out! This is a strategy that does not always work and should be used sparingly. It is in no way an investment advice, you are the only masters of your decisions.

I also use the CoinCheckup.com site which analyzes and rates each crypto-currency according to certain criteria (project, team, communication…). This site can be interesting to find a nugget still undervalued 💰! Be careful though to take a step back when using these ratings and analyses, always do your own research!

I also want to talk to you about burn, which is often used in crypto projects. This consists of burning (removing) part of the tokens in circulation for a given crypto. It is a marketing and financial strategy to pump the price of a crypto: the fewer tokens there are in circulation, the more the price rises (scarcity attracts). When a burn is announced by a crypto project, we quite often see that the price increases in the days/weeks preceding the effective date of the burn .

⚠ Watch out! This is a strategy that does not always work and should be used sparingly. It is in no way an investment advice, you are the only masters of your decisions.

frequently asked Questions

What are the best cryptocurrencies?

It all depends on your goal and your risk aversion. If you want to make a lot of money quickly then you can favor low capitalization cryptocurrencies hoping that their price will be multiplied by 10 or 100. But beware, the risk is very high and this is very unlikely to happen. If you invest part of your money in cryptos, the best solution is to place part of your capital in solid cryptos like Bitcoin. Never invest more than you are willing to lose.

Am I going to make money?

Impossible to know. It is possible that the price of the crypto-currencies on which you invest increases by 500% but it is also possible that their prices fall to 0€. Remember this sentence: not sold, not lost but not sold, not won either.

Is it complicated?

Less than it sounds. If you read our article, you will already have a good foundation so as not to fall into several traps that promise you easy gains. We offer you many questions and things to check before investing in a crypto project.

What to do with your cryptocurrencies?

First, we advise against leaving them on exchange platforms because they can be hacked. It is best to place them on wallets, ideally hardware wallets like the Ledger Nano X. You can also trade or buy goods and services with your cryptos or use them to invest in staking, masternodes, etc.

Conclusion

This article is finished, I hope it will allow you to better structure your research and your analyzes and above all that it will allow you to optimize your investment choices! I strongly recommend that you always do your own research when you want to invest in crypto. It is not reasonable to invest because we heard someone say that the price was going to be multiplied by 10. It is generally in these types of situations that we buy without taking the time to do our own research and that we are mistaken.

Zero risk does not exist, a super project could very well be abandoned for hundreds of reasons. Moreover, you can never be 100% sure of making the right choice without understanding the computer code of a crypto. But by analyzing certain indicators you can achieve a success rate high enough for this risk to become negligible.

I have warned you a lot in this chapter, encouraging you to invest in recognized projects that meet many criteria. The reality is a little different, it will depend on the level where you want to put the risk/reward slider. The less known a project is, the more risky it is to invest, but the more it is possible to multiply your gains by investing in a promising cryptocurrency. An embryonic project could obviously not meet a good part of the criteria that I have told you about in this chapter. But it could also be that after several months it becomes an essential project and its price explodes.