With both Bitcoin and Ethereum breaking their all-time highs in the past few weeks, hitting AU$93k and AU$6.6k respectively, investors are anticipating some exciting price exploration in the next few months. Since Bitcoin has already established itself as the king of crypto and Ethereum a leader in blockchain technology, a lot of crypto investors are looking for undervalued altcoins that can outperform the market.
But which are the best altcoins?
1. Avalanche (AVAX)
Avalanche is one of the fastest smart contract platforms, yet still has low fees and is highly decentralised. Of late, everything’s been fast in the Avalanche ecosystem, with many new apps being launched and the price rising rapidly. In fact, both its price and number of active wallets hit all-time highs in November.
Despite it being a competitor, Ethereum’s Vitalik Buterin has praised the protocol, saying “I think it’s very fair to treat Avalanche and Bitcoin as having similar levels of legitimacy.” Notably, like Bitcoin, Avalanche has a fixed supply, which creates scarcity for the token and could significantly increase the price if demand keeps growing. Although, perhaps more importantly, the legitimacy that a fixed supply gives its monetary policy could be more important.
Part of the reason that the Avalanche ecosystem has grown so fast is that applications can easily move over from other blockchains and bring their existing tokens with them. Given Ethereum’s current high gas fees, this has prompted many to switch over to the protocol.
2. Solana (SOL)
Solana’s market cap has now passed the AU$90 billion mark, making it a top-five cryptocurrency. Like Ethereum, Solana is a layer-1 blockchain, which means rather than being the actual app that people use, layer-1s provide a secure foundation for an entire ecosystem of decentralised apps.
While some worry that Solana isn’t as decentralised as Ethereum, given Ethereum has more nodes, it’s certainly faster. The best way to think about Solana is as a high-performance blockchain. Instead of competing only against blockchains like Ethereum, they’re also looking to outdo centralised trading platforms like NASDAQ. With significant investment in the ecosystem, that future looks possible.
Recently, the co-founder of Reddit announced he would invest US$100 million in a social media platform being built on Solana, while prominent venture funds also invested US$100 million, but this time for web3 gaming. Not to mention, US$40 million was also invested to make Solana EVM (Ethereum Virtual Machine) compatible, meaning apps built on Ethereum can move over to Solana.
3. Quant (QNT)
Quant isn’t considered to be on the same level as Solana and Avalanche, but if it keeps growing its network, it could be soon. Unlike many other blockchain projects that are focusing on integrating with other cryptocurrencies, Quant is building bridges to connect its Distributed Ledger Technology (DLT) with some of the largest corporations and institutions on the planet.
Already, they’ve partnered with the tech giant Oracle. Now, they’re looking to connect with more major players, including central banks to transfer funds, corporations to manage supply chains, or fintech companies to send payments. While they have high aims, it seems they may have the technology to make them a reality.
While its price rocketed up over 500% in a few short months, it has since given back almost half of those gains. Some traders are wary and others see it as a buy the dip moment.
4. Sandbox (SAND)
It’s an exciting time for Sandbox. After four years of hard work behind the scenes, they’re finally launching Metaverse Alpha on the 29th of November. It’s an event designed to introduce users to their blockchain-based virtual game, also known as a metaverse.
The token has surged 500% in the past month. It was spurred on by Facebook’s announcement that they’re rebranding their company to ‘Meta’ as they’re aiming to “bring the metaverse to life.” Facebook’s move has helped investors realise how big of an opportunity the gaming industry is, a hundred billion dollar industry and will likely double within the next few years.
While other centralised big tech companies Google, Microsoft and Apple are all building tech to build their own metaverse, a decentralised metaverse like Sandbox has distinct advantages, as users can own and control their own data and digital assets.
5. Illuvium (ILV)
Created by three Australian brothers, Kieran, Aaron, and Grant Warwick, Illuvium is an open-world RPG adventure game that is built on top of the Ethereum blockchain.
It has attracted a lot of excitement across the entire crypto space, as it incorporated three of the biggest current trends in crypto; NFTs, decentralised finance, and play-to-earn gaming. What’s that all mean? Basically, it means that players can own virtual goods, trade them on a marketplace powered by software, and sell those goods for real money.
And being built on Ethereum is a big advantage compared to other games, as it means that players can move their virtual goods from Illuvium to other games built on the Ethereum blockchain.
Make your move
These are some of the best altcoins you need to know about, but there are many other exciting projects. Other layer-1s like Cardano and Algorand are also exciting, while the Decentraland metaverse token has been rising fast.
Still, while there are expectations for new all-time highs in the coming months, they’re certainly not guaranteed. As always, make sure you manage your risks (and your emotions) when investing.
Cover image: Chinnapong/Shutterstock.com
Thanks for visiting Canstar, Australia’s biggest financial comparison site*