5 billion-dollar market cap cryptos with over 5,000% growth in 2021

The only reason why the cryptocurrency world is dominating news headlines is the eye-popping returns of crypto assets.

The year-to-date (YTD) return of the most closely watched index of the world, S&P 500, is nearly 25 per cent as of now. In Canada, where the benchmark index, TSX Composite breached 20,000-mark this year, the index’s YTD is over 20 per cent.

In contrast to this, and amid all the criticism over high valuation, Bitcoin has returned almost 100 per cent so far. Its nearest competitor, Ether, has returned over 400 per cent. But 2021 can be the termed as the year of altcoins. These best performing cryptos of 2021 have set the bar high for 2022. In a few cases, the return is so high that a dollar invested would have become US$ 20,000 today, in less than a year. As the year comes to a close, let’s look at the best performing altcoins so far.

Also read: Is Bitcoin better than gold as hedge against high inflation?

1. Axie Infinity (AXS)

Axie Infinity comes with multiple reasons to top this list. Returns aside, this blockchain-based game is a close watch in 2022 as the world warms up to metaverse. Metaverse is a virtual realty world of games, digital assets and the potential to let users earn revenues from the ownership of these assets.

Axie Infinity has made the cut in the list of top 30 cryptocurrencies by market cap. What drew the interest of investors is the combination of decentralized gaming, in-game non-fungible tokens (NFT) and the ease to trade assets.

The Axie characters used within the game are NFTs and their owners can list them on OpenSea, an NFT exchange. Here, they come with a resale potential backed by their distinct looks and features. Blockchain gaming is not immersive alone; it provides users the chance to have a say in governance. The native AXS token can be used to vote on such issues.

Also read: What are DeFi games & which are the most popular DeFi games?

AXS is currently on a dream run, and it has returned over 20,000 per cent so far in 2021. From under US$1, it rose to US$160 by early November. A wider bearish trend in cryptocurrencies over the past few weeks has brought the price close to US$130 as of now. Axie’s further gains rely much on how the world reacts to metaverse.

2. Solana (SOL)

Solana is a direct competitor to Ethereum’s supremacy in blockchain. The latter powers NFTs and ERC-20 tokens – AXS is an Ethereum-based token – and finds wide usage. Solana, launched only in 2020, is fast catching up.

Solana’s blockchain uses the proof-of-stake consensus protocol alongside proof-of-history, which is said to cut down processing time. Solana claims to offer lower fees to users with the possibility of executing smart contracts and creating decentralized apps (DApps). Solana is said to come with better scalability of the network. NFTs, which have largely remained restricted to Ethereum, can also be minted and stored on Solana.

Solana is a multi-billion dollar market cap crypto, nearly US$67 billion, and is ranked fifth overall. The returns in 2021 are so high that Ethereum could be headed for a tough fight next year. SOL price as of now is nearly US$220, which translates into nearly 15,000 per cent YTD return. Growth in 2022 will rely on the blockchain’s utility with respect to smart contracts.

Also read: Is investing in altcoins better than Bitcoin?

3. The Sandbox (SAND)

The world of startups will be a little less sparkling without SoftBank, the Japanese conglomerate, which has invested in multiple new businesses across the world. Recently, SoftBank parked US$93 million in a project with blockchain gaming and NFT underpinning. The project’s name is Sandbox, which is making even more headlines after Facebook’s Meta move.

The Sandbox follows the same ‘play-to-earn’ model of Axie Infinity where a virtual world enables owing of digital assets. It also allows creation of new NFTs. Here, a decentralized autonomous organizations (DAO) model comes into play where the native token SAND can be staked to participate in governance.

From US$0.035 on January 1, 2021 to US$5 as of now, SAND has dominated the cryptocurrency field in 2021. Much of the gains can be attributed to the craze for metaverse and investors’ focus on companies already operating in the space.

The Sandbox has a market cap of nearly US$4.5 billion. High market cap and low price per token makes SAND a good watch for 2022.

Also read: FB’s metaverse can be a blessing for these 5 blockchain games

4. Fantom (FTM)

Fantom uses a unique consensus mechanism to make blockchain transactions faster. The platform enables creation of smart contracts and is a provider of decentralized finance (DeFi) services to developers.

This means that Fantom too is competing with the industry leader Ethereum. The rise of Solana and other blockchain providers like Fantom in 2021 means the industry may be heading for consolidation in 2022. Fantom uses the native token, FTM, to facilitate payments within the system.

The demand for Fantom’s blockchain and a resulting demand for FTM have led to over 10,000 per cent rise in FTM’s value in 2021. The project’s market cap is over US$5 billion as of now.

Also read: 5 breakout altcoins with metaverse underpinning

5. Polygon (MATIC)

While others are challenging Ethereum, Polygon is aiming to improve Ethereum’s blockchain features. This, it does, by making it multi-chain, which brings Ethereum on par with blockchains of Polygon and other projects.

Polygon makes use of Plasma framework to enable execution of smart contracts. It also uses the proof-of-stale consensus mechanism to make Ethereum scalable. Multiple DApps have been built on Polygon, and it claims the ability to house unlimited number of such programs.

Polygon’s in-house cryptocurrency is MATIC, an ERC-20 token. From US$0.018 at the start of 2021 to US$1.6 as of now, MATIC has returned well. The token even breached US$2 in mid-May, but a sustained bearish trend brought the value to below US$1 by July. MATIC’s market cap is nearly US$11 billion.

Also read: Top Ethereum-based DeFi platforms of 2021

Bottom line

The above five are not the only cryptos that have returned over 5,000 per cent in 2021. But what makes them an interesting watch as we step into 2022 is their potential to rise further. Two of these are riding the metaverse wave, and the rest are competing with Ethereum’s dominance in decentralized finance. Bitcoin and Ether may have entered a phase where multi-fold growth may remain subdued. The above five have a high market cap and the potential to grow depends on projects’ further adoption in 2022.