- After a dull January, riskier assets including cryptos and stocks may pull off a comeback
- Like stocks, there are different sectors in cryptos including metaverse, blockchain network, and gaming
- Volatility ails cryptos, and it may take some more time for these assets to become predictable
January was a dull month for cryptocurrencies. Almost all major cryptos lost value. One of the reasons is the looming interest rate hike. The Fed may raise rates in March, and all riskier assets including stocks and cryptos are under pressure.
From BTC to one of Elon Musk’s favorites, Dogecoin, all cryptos traded below their all-time high prices in January. In stocks, tech giants including Apple were also under pressure.
In this light, which are the five cryptos to watch in February 2022? Let’s find out.
1. Bitcoin (BTC)
Any cryptocurrency list is incomplete without Bitcoin.
Now that we know Bitcoin has become a legal tender in at least one country and that S&P Dow Jones indices are tracking its price, what about BTC price in 2022? El Salvador’s president Nayib Bukele has predicted that BTC would touch US$100,000 in 2022, but nothing is certain in the volatile crypto world.
In the near-term, however, Bitcoin might regain at least some lost ground. The largest crypto by market cap is the heartbeat of crypto investment world. Not just its November 2021 peak of nearly US$68,000, Bitcoin is presently down from its price of nearly US$46,000 on January 1, 2022.
Bitcoin may also gain if stocks manage to rebound after the correction that hit the global stock markets in January.
Data provided by CoinMarketCap.com
2. Binance Coin (BNB)
BNB, the token of Binance network, was priced over US$500 at the start of this year.
The fall in price is significant despite the use of Binance Smart Chain (BSC) network in decentralized apps (DApps). Binance exchange is a leading crypto trading platform globally. In decentralized finance (DeFi), BSC is a leading network.
BNB price will be decided by a slew of factors. First, BSC faces competition from Ethereum and other networks like Fantom. Second, Binance crypto exchange was banned from conducing business in some jurisdictions.
3. Dogecoin (DOGE)
Another top crypto asset by market cap, Dogecoin finds regular mentions in Elon Musk’s tweets. Musk recently had an exchange with fast food giant McDonalds over Twitter, and Dogecoin was at the heart of it.
The meme token gained well in 2021 and its biggest rival, Shiba Inu, also found backers. Tesla accepts Dogecoin from buyers of company’s merchandise. DOGE is also said to be used for rewards in Reddit. DOGE is one of the few cryptos that could post some YTD gain in 2022. It rose after Musk’s tweet, but again entered a bearish phase.
DOGE February price would rely on any tweets by Musk and the crypto’s acceptance by other retailers.
4. Axie Infinity (AXS)
AXS was as high as US$160 in early November 2021, but the dip so far has also been substantial. Axie Infinity’s blockchain game, with features of non-fungible tokens (NFTs) and decentralized autonomous organization (DAO), attracted many backers last year.
Despite Microsoft’s likely move into metaverse with the acquisition of Activision Blizzard, AXS and other metaverse tokens haven’t fared well in 2022.
In February, AXS might emerge from the subdued phase if more gamers join the platform and NFTs of the network trade well on platforms like OpenSea.
Data provided by CoinMarketCap.com
5. Polkadot (DOT)
Polkadot has emerged as a formidable rival to Ethereum, the most popular blockchain network with the second largest crypto Ether. Polkadot claims to be a significant part of Web3, which is being touted as the blockchain-based future of tech.
Polkadot allows development of decentralized applications, and a few platforms like Moonbeam enable developers to move their apps from Ethereum to Polkadot.
DOT crypto finds use within the network as a token for staking and governance. DOT may rise in the near future if more developers prefer Polkadot over other networks including Ethereum and Solana.
Top 5 cryptocurrencies to watch in February 2022
Cryptocurrencies made news in January only for their significant fall in value. The total market cap of all cryptocurrencies tracked by CoinMarketCap was nearly US$3 trillion at one time in 2021. It is now under US$2 trillion, and no major relief is being expected by most analysts.
In February, however, some dust may settle on things like rate hikes. Besides, a few investors may also want to buy cryptos at a subdued price anticipating that prices will rise in the medium-to-long term.
The above five cryptos are solving different purposes. Bitcoin is largely competing with fiat currencies; Binance is a complete ecosystem with an exchange, a blockchain network and native token; Dogecoin is a meme token used in rewards; Axie Infinity is a sort of metaverse with NFT features; and Polkadot is a network rivalling Ethereum.
These five represent different sub-sectors within cryptocurrencies. It is possible that a boom in any one sector, for example metaverse, may bring back bulls in the linked cryptocurrency.