There is no doubt that we appear to be in the throes of the next crypto bull run. Bitcoin is near all-time highs, and the market appears poised to break some really exciting levels.
Now, this is not only good for bitcoin, but it is also good for the altcoin market. For those that have followed the crypto markets for some time, they’ll know there’s usually a pivot to altcoins once bitcoin has rallied.
However, given how more sophisticated the markets have become, it’s unlikely that this rising tide will lift all boats. Only some altcoins are likely to capture those gains.
This then begs a very important question: Which is the top crypto?
Well, that’s exactly what I’m going to cover in this blog post. I’ll be taking you through five of my top altcoin picks for this year.
These altcoins are not only well diversified across tech market cap and use cases but are also all coins that really could explode this year.
What Is The Best Crypto Picks With MASSIVE Potential
I value your time; hence I’ve placed the table of content below. It is there for your convenience, so feel free to jump around if you’re pressed for time already.
Enough beating around. Let’s get into this.
I think it’s worthwhile to give you a quick overview of how I’ve chosen these picks. It’s an important insight into my thinking of broader portfolio diversification and allocation.
The way I like to approach this is the same way I approach my portfolio. It’s all about diversification to underlying use cases, market cap, and sector.
This is important because oftentimes, despite how good a project is on paper, the sector within which it operates may not be as hot. However, if you’ve chosen projects in different sectors, you are diversifying your sector risk.
Something else that I try to diversify is the market cap of the coins in the list. As you’ll see with some of these picks, some have a relatively high market cap within the top 50, whereas others have market caps below the top 200.
This is important as you’ll know that the chances of making a 50x return on a token are much more likely on a low cap than they are on a promising yet high market cap coin.
Why is this?
Low cap coins are inherently more risky and volatile. The risk of the token falling through the floor is higher on smaller projects than it is on higher caps and more established ones.
I should also point out that these altcoins are presented below in no particular order, but pay attention to why I’ve chosen each of these coins.
Monero (XMR)
Apart from having the most cutting-edge cryptography protocols on the market, Monero also stands for something much more fundamental; financial freedom. Truly anonymous peer-to-peer digital cash.
It’s a pretty well-established crypto that’s been around for about six years; however, it’s been in the news quite a lot recently, and that’s because of who has it in their sights. That’s right, the large enforcement agencies are not too happy about pure financial freedom.
It’s, therefore, pretty clear that Monero has some damn powerful enemies, and you may be wondering how on earth I can put it on my list?
Well, one man’s meat is another man’s poison. I take the view that this intense focus by these agencies shows that they view Monero privacy-enhancing technology as a threat that they struggle to control.
This can only mean that it’s working as intended, and despite having so much thrown at it by all of these players, they’ve still not been able to crack the encryption and de-anonymize users.
Ciphertrace has developed a patent that helps to track transactions, but this is purely a probabilistic approach. It uses well-known techniques in transaction clustering to hone in on likely address flows, but it’s far from cracking the algorithm.
Apart from this, there are several other reasons as to why I’m very bullish on Monero:
Firstly as mentioned, the privacy tech is unrivaled.
Secondly, this tech is constantly evolving as the developers work to harden the protocol and secure its privacy, and speaking of those devs, they are some of the most hardcore cypherpunks in the crypto space.
A broader collective of idealistic individuals all driven by their goal of preserving financial freedom. I should also point out that all funding on the Monero network is coming from the community, with no outside interests.
Another reason why I’m more bullish on Monero than other privacy coins is that it has the highest liquidity among them. This is even though exchanges have been put under pressure on privacy by default coins like Monero.
The fact of the matter is that Monero is still a damn popular cryptocurrency. There will always be a market for it and an exchange willing to service it and even if the centralized exchanges make it difficult to use exchange XMR, decentralized alternatives will eventually fill the breach.
That’s because one of the most promising community-funded rd programs that have been worked on right now is Bitcoin-Monero Cross-Chain Atomic Swap.
This will allow users to easily exchange their Monero for Bitcoin and vice versa, which is cross-chain.
A seamless bridge from where the all-seeing eye reigns to where it is blind I should also note that Monero is one of the more decentralized proof-of-work cryptocurrencies.
this is because of some changes that were made to its mining algorithm as you’ll no doubt know centralization is one of the biggest risks to a distributed system.
For example, there are several fears around the centralization of bitcoin’s mining hash rate in China.
Finally, I’m bullish on Monero because of the state of the world. If there’s one theme that’s emerged this year is that privacy is under assault from anti-encryption bills to mandatory exchange reporting requirements from the elimination of cash to the launch of central bank digital currencies.
As more people realize that these freedoms are being rug pulled from under them, they will gravitate to solutions that preserve said freedoms.
Algorand (ALGO)
We all know that there’s a hell of a lot of hype around smart contract blockchains. You need to look no further than the excitement around Ethereum 2.0. It’s one of the reasons that it makes up such a big chunk of my portfolio.
However, one size does not fit all, and it won’t be a matter of winner takes all. That’s why it could be wise to diversify your allocation to other developer-friendly blockchains.
There are a lot of promising networks out there, but Algorand is one of the more intriguing, which has been on my radar for quite some time.
Let’s start with a bit of an overview. Algorand is a blockchain that has actively set out to solve the pretty well-known blockchain trilemma more specifically they want to develop a blockchain that is:
- Scalable
- Secure
- Decentralized
How they plan to achieve this is down to their highly performant consensus mechanism. It’s called pure proof of stake. The main benefit of this is that Algorand’s technology finalizes blocks in seconds and provides immediate transaction finality while preventing forks.
Why am I optimistic about Algorand?
Well, let’s start from the top. The team behind this project is like a who’s who of cryptography. It’s composed of some of the smartest brains in the field from universities like MIT.
The fun fact is the founder is a professor called Silvio Mccarley, who is famous for first conceiving zero-knowledge proofs.
That fundamental technology you hear about from very many cryptocurrency projects. He won a Turing award for his work on this. But it’s not just brain power backing the project. It also has a lot of capital.
Algorand has a separate VC arm that has raised a lot of funding specifically for the incubation and adoption of projects building on Algorand.
You can think of it as analogous to Consensys for Ethereum or Emurgo on Cardano. This Algorand entity has already incubated several projects, and as we know, adoption is key to utility demand for a blockchain.
And speaking of adoption, it was recently announced that the USDC Stablecoin had been integrated into the Algorand blockchain.
This means that USDC users will be able to send the Stablecoin on the Algorand network cheaper and faster than would be done on Ethereum for example. It’s also no secret that USDC is becoming the de facto Stablecoin globally.
For example, you had the recent monumental news that Visa would be offering USDC settlement to all its 60 million merchants. All of this transaction demand will need a super fast and efficient blockchain to be settled on.
All of this transaction demand on our grant will, of course, naturally lead to a demand to pay for the transactions which are paid in Algo.
And while we’re on the subject of utility demand for the blockchain, I should also point out that Algorand is actively trying to court the DEFI sector with their unique smart contract language called Teal.
It’s a non-Turing complete language that, although it limits functionality, is often considered safer to write and execute. Perhaps it could be an attractive alternative for enterprise developers worried about solidity smart contracts.
Okay, so Algorand is impressive, but why has the price been lagging?
Well, I think it mostly came down to an initial oversupply out of the listing. Last year they seemed to have sold quite a bit in the early auctions, and when these hit the market, the price slumped.
However, they have engaged in several buybacks and have redesigned their token. I should also point out that it is a staking blockchain which means the more staked, the less circulating supply.
I think our Algorand could be an attractive, smart contract play.
Theta (THETA)
Theta is a project that is looking to completely transform the way we think about streaming and online content delivery.
More specifically, they want to decentralize and democratize it, and the Theta blockchain is the only end-to-end infrastructure for decentralized video streaming and delivery currently on the market.
This type of scale is all possible thanks to some pretty mind-blowing streaming and blockchain technology.
I mainly want to get on to why I think Theta could be such a hot pick.
Firstly, streaming itself is hot. You need to look no further than Youtube and Twitch, with billions of users. These are all on centralized platforms and use centralized content delivery networks. You can see why theta is appealing here.
Secondly, Theta is streaming content. They started with esports but have since moved on to poker, cryptocurrency events and have also partnered with MGM to stream Hollywood classics briefly. You can also add the SpaceX launch to that list.
I also want to note that Theta has a strong team and even stronger advisors. These include the likes of Stephen Chen, a Youtube founder, and Justin Kan, the founder of Twitch.
Theta has also received investments from the likes of Samsung.
I should also point out that Theta labs got a US patent for their decentralized blockchain streaming technology formally titled “Methods and systems for a decentralized data streaming and delivery network.” As we all know, patents help secure business modes.
When it comes to the tokens of Theta, there are two tokens here; Theta and Theta Fuel. Theta has a capped supply, and all tokens are now in circulation. This means that you’re not at risk of any dumps from investors or team members.
Also, note that 55% of all the Theta tokens are being staked, which means less token supply on the market.
When staking these Theta tokens, you’ll earn Theta fuel or T-Fuel. T-Fuel is used as gas for smart contracts and, once used, will be permanently destroyed.
Not only can you own rare and limited Theta tokens as well as stake them, but you will also earn T-fuel tokens, which should become more valuable over time as they’re burned, assuming protocol inflation doesn’t outweigh it.
Something else that you should note from a utility demand perspective is that Theta smart contracts will be compatible with Ethereum.
This means that Theta could also bring in a bit of that hot DEFI flavor that Ethereum has been the recipient of this year, and this utility demand could drive prices.
There’s one more thing that could boost that Theta price; that is a potential Coinbase listing. The exchange placed Theta on their list of tokens that they are considering listing, and we all know the impact of the infamous Coinbase pump.
I think theta could be an attractive and diverse play for your portfolio.
Injective Protocol (INJ)
This is a medium cap gem. The injective protocol is a decentralized derivatives exchange that’s built on Cosmos. It was one of the most exciting dex launches and has already picked up quite a bit of steam.
I hold some INJ in my portfolio, and for a good reason. They are trying to create a paradigm shift in the dex space. It will allow users to trade spots, swaps, and futures in an entirely permissionless way.
They’ll also be able to structure their derivatives on the platform and create a market for it. Anything that has a price, users could eventually be able to issue their decentralized derivative contracts for.
Technically it’s implemented as a Cosmos SDK module and is built with Ethermint. This means it has one major advantage over most of the Ethereum based dexes on the market.
This is because it’s a layer two-speed Cosmos zone and hence does not have to put up with the congestion that other Ethereum based dexes do.
Moreover, because it’s built on Cosmos, you can exchange more than just erc20 assets. This comes down to the nature of how Cosmos stones operate. Instead of one singular blockchain, there are several independent and interoperable blockchains.
I am optimistic about the tech behind the Injective Protocol. But there are some other reasons why it’s one to watch:
Firstly, Injective labs are backed by some pretty well-known VCs in the space, including the likes of Pantera Capital and Binance.
Secondly, the team is also quite accomplished, and they’ve been working on the protocol for quite some time since 2018.
More recently, they have released their solstice test net. The amount of community enthusiasm around this test net launch was quite intense. It also attracted some media coverage with stories on the likes of TechCrunch and Cointelegraph.
It turns out that this was only the first salvo, though, and the Injective team recently released version two of their test net only eight days after version one was released; impressive stuff.
If it all goes to plan on the test net, then we’re looking to a much-hyped main net launch. When it comes to the INJ token itself, it has some pretty favorable tokens.
There was only a limited percentage, only nine percent of the total supply. There was such high demand for it in the Initial Exchange Offering that the price immediately rallied once trading commenced.
I also would not worry too much about any of those private sales or founder tokens flooding the market anytime soon. That’s because the token unlock schedule appears to be quite reasonable.
No cliffs once the main net does launch. These tokens will be used to pay transaction fees. These fees are then burned, which of course, leads to a reduction in circulating supply.
That token is taken off the market to stake on the network, and you have two factors which are long-term price positive that’s not even including the potential demand that there could be to hold the token to take part in decentralized governance.
As we’ve seen from the DEFI space, the opportunity to take part in decentralized governance of the protocol is an important valuation metric in the token.
Apart from all that, though, INJ has a lot more upside potential, and that’s because of its market cap. Higher return multiples are likely for smaller cap coins.
BarnBridge (BOND)
BarnBridge is a DEFI project that is a mind-blowing protocol. It’s a project that’s looking to “tokenize risk protocol.”
What does this mean?
They’re trying to isolate and tokenize different yield risks in the DEFI space. Essentially it works by pooling funds on the platform and then allocating these funds to different DEFI protocols. These include Ave, Compound, Synthetics, etc.
Then once the funds have been pulled, they will tranche the yield such that it can be tokenized individually.
This, therefore, means that DEFI investors can invest in different risk tranches based on their yield and risk tolerance. This is called their smart yield bonds, and it was the first one that they launched.
However, they’re also working on a similar product called smart alpha bonds. This will be more complex and won’t be based on tranching DEFI yield or interest but by separating token returns into different risk tranches. Essentially risk exposure will come from price instead of yield.
All you need to know is that it’s a unique project in the DEFI space. Not only is it matching users up with their desired risk tranches, but it will also allow users to invest in fixed interest rate DEFI instruments certainty around that yield.
Why am I optimistic about BarnBridge?
Firstly it’s well-positioned to take advantage of the massive shifts we see in DEFI. The total value locked into d5 protocols has gone parabolic this year.
Given the unique nature of BarnBridge’s protocol is likely to be that much more attractive than all the plain vanilla lending platforms and dex protocols.
Secondly, the project has also been backed by the founders of both Aave and Synthetics, who no doubt know a thing or two about growing a DEFI protocol.
They only raised a minimal amount of initial seed funding and ran a pretty fair launch of the protocol. There were no Initial Coin Offerings, and 68 of the BOND token will be distributed to the community through several yield farming and liquidity incentives.
These governance tokens will then be used to vote on important governance proposals on the platform. There are plans in the pipeline to eventually release smart contracts governed by the DAO where users can define what they would like the core contracts to do.
This will mean that the members of the BarnBridge community may have a say in how risk is tranched and which protocols to invest in.
This means that the token holders make economic decisions that progresses the entire finance platform forward. This adds fundamental value to the token.
Apart from that, we can also just look at the broader tokens.
There will only ever be 10 million bond tokens distributed. Once they’ve been fully distributed in about two to three years, you won’t be able to mine any more of it. Hence, you have an asset with a naturally limited supply.
Think about Yearn finance; for example, once those 30 000 wi-fi tokens were distributed, they became pretty damn valuable.
Moreover, the BarnBridge community seems to be quite engaged in the project, and two days after yield farming went live, there were already 200 million dollars locked into the protocol.
The devs are also hard at work building out those lending products, which are likely to go live within the next few months. If these products do truly live up to their expectations, I have a feeling that BarnBridge may be a DEFI darling.
When it comes to those bond tokens, they are currently only available on Uniswap for trading. Although if you have some free Stablecoin capital, then you could also join their liquidity pools and farm some BOND.
Given the currently low market cap of BOND, the upside potential from here is quite substantial. I will, of course, caveat this all and say that it is still a new protocol, and as such, there are risks, but that’s life.
Conclusion
That’s it, folks, my top altcoin picks. As I mentioned in the beginning, these were carefully curated to give a well-diversified altcoin play.
Hence, I would therefore discourage you from yellowing all in on one of these particular projects. You open yourself up to idiosyncratic risk, which cannot easily be hedged away.
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