If there is one thing everyone knows about cryptocurrencies, it’s that they are incredibly volatile. Inspiring stories of people making millionsduring a market upswing make headlines about as often as the dark tragedies of people losing everything during downswings. And with so many cryptocurrencies from which to choose, picking the most undervalued ones only complicates matters.
It is understandably tough to assign value to a cryptocurrency because there is no physical product or centralized organizing body that investors can look to for positive indicators. However, there are many concrete ways that crypto acquires value, and these include things like technological developments, supply and demand, celebrity endorsements, whales, and competition, among other things.
In today’s article, we’re going to focus on the most undervalued cryptocurrencies in 2022 and how to spot them.
The 4 Most Undervalued Cryptos to Buy
The cryptocurrency market took a big hit in early 2022 as inflation, global market uncertainty over crypto risks, and the Russian invasion of Ukraine pushed crypto price thresholds to new lows. What does this mean for you as an investor? Well, there’s no better time to invest, as the next crypto bull run might be right around the corner. FOMO, anyone?
Below are seven of the most undervalued cryptocurrencies in 2022.
Cardano is a proof-of-stake blockchain platform that was launched in 2017. It’s designed to be secure enough to protect large quantities of data, scalable enough to accommodate global systems, and robust enough to support foundational changes.
In terms of tech developments, Cardano was specifically created to solve many of the problems Ethereum was facing (and still is) due to its proof-of-work consensus model. In fact, Cardano is regularly touted as an Ethereum killer. The platform was built using a peer-reviewed methodology and consistently ranks high among crypto projects with the highest developer activity, which makes it a strong competitor for projects like Ethereum, Cosmos, and Polkadot.
Cardano has also received some celebrity endorsements. For example, in February 2021, Gene Simmons announced that he had bought $300,000 worth of Cardano’s native currency, ADA. In his tweetannouncing the purchase, Simmons stated that he invested in Cardano because “it’s pennies compared to my other holdings like Bitcoin” and that he “believes everyone should be able to afford cryptocurrency.” Simmons has reportedly invested in Bitcoin, Ethereum, and Litecoin.
A recent data analysis performed by crypto-analytics platform Santiment concluded that ADA is undervalued based on its performance and growth over the past year. Santiment analyzed Cardano’s Market Value to Realized Value (MVRV) indicator to reach that conclusion.
According to market data, ADA managed to reach an all-time high of $3.10 in September 2021, but it failed to maintain that upward momentum. 2022 started rough for ADA as its value slowly tumbled to less than $1. It’s a great time to buy!
Ripple is a digital payment network and cryptocurrency that was first released in 2012. The network is similar to the SWIFT system used by banks and financial institutions to initiate global money transfers. The concept behind Ripple is to create a trusted agent that can facilitate fast and extremely cheap exchanges for fiat currencies, cryptocurrencies, and even commodities like gold.
Ripple’s use case was novel when it was originally launched, and, while other blockchain projects offering digital payment solutions have emerged over the years, it still remains at the forefront. Endorsements by a range of celebrities, including Ashton Kutcher (who donated $4million in XRP to charity), Madonna (who partnered with Ripple to fundraise for orphans in Malawi), Bill Clinton (who gave a keynote address at a Ripple conference), and Snoop Dogg (Shizzle my Ripple at a NYC event) have all helped Ripple’s public image.
The native currency, XRP, functions as the bridge that enables transfers on the Ripple network. While the system is primarily intended to be used by banks, anyone is free to speculate on the price of XRP. In fact, we praised Ripple back in 2021 in our price prediction and it’s landed on our radar of undervalued coins once again.
As of April 2022, the value of one XRP is approximately $0.08, which is significantly less than its all-time high in 2021 of $1.79. It’s hard to say how long this bullish sentiment will continue.
Polygon (formerly known as Matic Network) is a platform designed for Ethereum scaling and infrastructure development that bills itself as “Ethereum’s internet of blockchains” — that is, a multi-chain ecosystem for Ethereum-compatible blockchains.
Ethereum in its current form has some serious limitations. As the most popular hub for decentralized finance (DeFi) and smart contract development, it suffers from serious network congestion problems due to high user demand.
Polygon’s core component is the Polygon SDK, which is a modular framework that can be used to easily deploy and configure custom blockchains. It includes governance and consensus modules as well as a variety of virtual machine implementations and execution environments.
The project has caught the interest of a few notable crypto investors, including billionaire entrepreneur Mark Cuban, who reportedly gave a “sizable investment” to the India-based blockchain company in May 2021.
MATIC’s value rose to incredible highs in 2021, reaching an all-time high of $2.92 in December 2021. Its value has dropped by more than half that as of April 2022, reaching $1.65. Currently, most forecasts regarding MATIC’s future value are bullish. However, many experts believe the token could potentially triple in value by 2024.
Polkadot functions as a bridge that connects blockchains, allowing data and value to be transferred across previously incompatible networks. It was founded by Gavin Wood, who was the co-founder of Ethereum alongside Vitalik Buterin. Wood also played an integral role in the development of the Solidity programming language, which is used for implementing smart contracts by various blockchain platforms, including Ethereum.
Many experts believe Polakdot is undervalued largely because the project’s technical innovations may be tough for the average investor to grasp. In simple terms, Polkadot is a blockchain that helps cryptocurrencies talk to each other. It is the “Internet of Blockchains.”
The base network is a relay chain that connects other individual chains. It supports so-called “parachains,” which are essentially unique individual blockchains that run parallel to the main relay chain. Parachains make it simple for developers to deploy blockchain apps with high throughput and traffic without needing to build a solo blockchain.
No notable celebrities or crypto whales have endorsed Polkadot, but DOT experienced a huge surge of interest in 2021 when it reached an all-time high of $54.98 in November. However, like Tezos, it has also lost just over 65% of its value as of April 2022. The value of one DOT token reached less than $20.