The cryptocurrency market is constantly evolving with new digital assets emerging that aim to improve upon existing cryptocurrencies like Bitcoin and Ethereum. With over 18,000 cryptocurrencies already in existence, it can be challenging to predict which one will be the next big thing in crypto.
What criteria makes a cryptocurrency successful?
There are several factors that contribute to a cryptocurrency becoming widely adopted and gaining value over time:
- Innovative technology – Unique features or capabilities that improve upon first generation cryptos like Bitcoin.
- Active development – An active team of developers continuously improving and upgrading the network.
- Strong community – An engaged community of users, developers, and advocates supporting the project.
- Corporate partnerships – Partnerships with established companies lend legitimacy and real-world application.
- Mainstream usage – Easy-to-use applications and integrations that enable everyday usage.
- Store of value potential – Perception that the crypto retains or gains value over time.
Cryptocurrencies that strongly exhibit these characteristics tend to gain adoption and value. Analyzing projects based on these key factors can help identify promising emerging cryptos with breakout potential.
Top contenders for the next big cryptocurrency
Here are some of the top candidates that show promise to potentially become the next big cryptocurrency based on their innovative technology, active development, strong community support, and real-world usage:
Ethereum
As the second largest cryptocurrency after Bitcoin, Ethereum has already achieved mainstream success. However, it has the potential to grow even bigger through continued innovations like its shift to proof-of-stake consensus and new layer-2 scaling solutions.
Cardano
Cardano markets itself as a “third generation” blockchain that aims to solve issues with scalability, interoperability, and sustainability. Its proof-of-stake consensus mechanism also allows it to operate with lower energy usage than Bitcoin.
Solana
Solana prioritizes scalability and fast transaction speeds, with the capability to process over 50,000 transactions per second. This makes it a contender for mainstream adoption in decentralized finance (DeFi) applications.
Polkadot
Polkadot’s key innovation is its “heterogeneous multi-chain” architecture that allows different blockchains to share information and transactions seamlessly. This interoperability could significantly expand real-world use cases.
Avalanche
Similar to Solana, Avalanche is a high-speed blockchain that can process 4,500 transactions per second. It also has compatibility with Ethereum Virtual Machine (EVM) smart contracts, giving it potential to rival Ethereum.
| Cryptocurrency | Market Cap Rank | Key Features |
|---|---|---|
| Ethereum | 2 | Smart contracts, dApps, DeFi |
| Cardano | 8 | Proof-of-stake, sustainability |
| Solana | 9 | Speed, scalability |
| Polkadot | 11 | Interoperability |
| Avalanche | 15 | Speed, compatibility |
This table summarizes the top contenders and their key features and market cap rankings as of October 2022.
How institutional investments can signal future growth
Institutional investments from major financial companies and corporations are a strong indicator of long-term viability for cryptocurrencies. Here are some examples of institutional crypto investment and involvement:
- Major banks like Goldman Sachs and JPMorgan are offering crypto-related services and investing in the space.
- Payment providers like Visa and Mastercard are partnering with crypto platforms to enable crypto payment capabilities.
- Technology companies like Microsoft, Amazon, and Meta are exploring crypto and blockchain integrations.
- Financial firms like BlackRock, Vanguard, and State Street are trading crypto assets.
- Countries like El Salvador and Central African Republic adopting Bitcoin as legal tender.
This growing institutional investment signals that major players are confident in crypto’s staying power and ability to deliver value. It represents a huge vote of confidence that could spur broader mainstream adoption.
Major companies investing in crypto and blockchain technology
| Company | Investment Area |
|---|---|
| Visa | Crypto payment cards |
| Microsoft | Decentralized identity |
| Amazon | Managed blockchain service |
| JPMorgan | JPM Coin stablecoin |
| Meta | Crypto wallet Novi |
This table shows examples of major corporations developing products and services related to cryptocurrencies and blockchain technology.
How cryptocurrencies could evolve in the future
Here are some potential ways cryptocurrencies may evolve moving forward:
Greater mainstream adoption
As cryptos become easier to use in everyday transactions and investments, mainstream adoption will continue growing. Consumers now have access through platforms like Venmo, PayPal, and Robinhood.
More institutional investment
Institutional money from major banks, financial firms, corporations, and even governments will continue to flow into the crypto space, leading to growth and validation.
Expansion into DeFi
Decentralized finance applications will expand in lending, borrowing, trading, insurance, and more. Blockchains like Ethereum will facilitate broader DeFi adoption.
Payments integration
Seamless crypto payments integration into e-commerce sites, apps, and technologies will enable greater usage for remittances, merchant transactions, micropayments, and peer-to-peer transfers.
Regulatory clarity
Clearer government regulations and guidance will provide legitimacy and confidence for large entities to engage with crypto. Standards could vary geographically.
New scaling solutions
Innovations like sharding, layer-2 networks, and quantum computing could enable cryptos to scale for high-volume applications with fast, low-cost transactions.
Conclusion
Predicting which cryptocurrency will definitively become the next big thing is impossible. However, based on innovative technology, strong fundamentals, and increasing real-world utility and adoption, Ethereum and Cardano appear to be leading contenders. Other cryptos like Solana, Polkadot, and Avalanche also showcase huge potential.
As institutional investments continue growing and integration makes cryptocurrencies easier to use in everyday life, mainstream adoption will expand. This will propel crypto firmly into the financial mainstream within the next several years. While Bitcoin initiated the crypto revolution, the next phase will likely see newer generation cryptos gain prominence in powering the future of finance.