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5 Cryptocurrencies Sure to Be on Santa’s Nice List

5 Cryptocurrencies Sure to Be on Santa's Nice List
Written by publishing team

With only nine days left before we turn the page in 2021, it’s fair to say that crypto investors have enjoyed another above-average year. As of December 18, the total value of all digital currencies has increased by 185%. Moreover, the market capitalization of all cryptocurrencies has increased by more than 1,400% since its lowest level in March 2020.

While throwing darts into several of the most popular cryptocurrencies over the past year could have worked for investors, there are five cryptocurrencies that really stood out. So much so that they’re sure to be on Santa’s adorable list this holiday season.

Image source: Getty Images.

Solana

Do you want to know an easy way to get your adorable Santa roster? Providing annual gains of over 11000% to investors. That’s exactly what Solana (CRYPTO: SOL) He did for investors who had the luck, stomach, and money to buy it at midnight on January 1st.

Since Saint Nick’s entire mission is to bring gifts to families around the world in one night, he’s sure to appreciate Solana’s need for speed. According to its developers, Solana is capable of performing 50,000 transactions per second (TPS). For comparison, the two most famous blockchain networks on the planet are, Bitcoin And Ethereum (CRYPTO: ETH), processing 7 TPS and 13 TPS. In fact, Solana’s advertised TPS is more than double that of payment processing Visa (24,000 tons per second).

What makes Solana so special is the unique Proof of History protocol. Instead of validators wasting valuable time by having to talk to each other to confirm the amount of time that elapses between events, the Proof of History protocol creates an event log. This speeds up network processing and allows for rapid scaling.

Although Solana is still a little rough around the edges, her sheer speed gives her real long-term potential and staying power.

A person touches a cryptographic block that is part of a larger blockchain on a digital screen.

Image source: Getty Images.

Algorand

Another cryptocurrency that is sure to bring some holiday cheer is Algorand (encode: something). This least-followed cryptocurrency is up nearly 300% this year and is looking forward to a bright future.

Like Solana, Algorand will catch Santa’s attention due to the efficiency of its blockchain network. As of this past weekend, Algorand was crunching at 1,162 TPS, and offered a final block of 4.36 seconds. What this means is that transactions are validated and settled in just over four seconds. Relatively speaking, cross-border payments with existing financial infrastructure can take up to a week to be verified and settled.

However, what is most exciting about Algorand is the project’s focus on blockchain interoperability. With so many unique blockchain projects under development, many of them run the risk of not being compatible with each other, and therefore not being able to share files, data or funds. Algorand developers focus on filling these gaps, especially in the business world.

The icing on the cake here is Algorand also has a special consensus mechanism, known as pure Proof of Stake (PPoS). With PPoS, users are chosen secretly and randomly to propose blocks and vote on proposals. Thus, PPoS ensures that bad actors possessing small amounts of ALGO cannot disrupt the network.

A young man wearing headphones plays video games on his smartphone during a tournament.

Image source: Getty Images.

Axi Infinity

Santa is also sure to put Axi Infinity (CRYPTO: AXS) On its nice list, especially considering how much joy it has brought investors this year. The AXS token is up 18,600% in 2021.

Axie Infinity is a profit-to-play game built on the Ethereum blockchain. It allows users to collect, breed, breed and battle monsters, which are known as axes. At least three axes are needed to go into battle, with the winner earning experience points that they can use to improve their axes.

While there is no shortage of games or gaming platforms to choose from, what makes Axie Infinity intriguing is that every Axie is a non-fungible token (NFT). This means that users own Axies as digital assets that can be used to play or monetize the market (for example, they can be bought or sold to other users).

What has really allowed Axie Infinity to stand out is the real-world revenue that the game brings. According to TokenTerminal.com, Axie Infinity generated $1.24 billion in protocol revenue for 180 days. This makes it the second largest decentralized application (dApp) in terms of revenue during that period, after just Ethereum ($4.73 billion). These dollar figures show the attractiveness of the real world.

A digital map of the world, partially populated with binary code and blockchain nodes.

Image source: Getty Images.

Avalanche

The fourth cryptocurrency that has already been under the tree for investors this year is Avalanche (CRYPTO: AVAX). After beginning the year at around $3 per AVAX token, the avalanche fetched over 3,500% higher to $116.

Similar to Solana and Algorand, the good news that Avalanche provides comes in the form of a very fast and highly efficient network. Avalanche’s development team claims that its smart contract-based network can process more than 4,500 TPS and complete transactions in less than two seconds. Smart contracts are protocols that help to enforce, verify and facilitate the negotiation of a contract between two parties. They can be particularly useful in non-financial applications, such as supply chain management.

But what may be most responsible for getting Avalanche on Santa’s adorable roster is his ability to play well with others. As you can see, the Ethereum Virtual Machine is already running on the Avalanche blockchain. Although Ethereum is the preferred destination for building dApps, Avalanche offers one carrot-like structure given its faster implementation, lower transaction costs, and clear competitive advantages, relative to the Ethereum network.

Suffice to say, the avalanche appears to have a lot of momentum as 2022 approaches.

A person holds a glowing golden padlock surrounded by grid works representing blockchain nodes.

Image source: Getty Images.

Cardano

The fifth and final cryptocurrency to find its way onto Santa’s cool list is Cardano (CRYPTO: NO). The 625% gain through December 18 is more than enough to send investors onto the streets.

The reason Santa believes so strongly in Cardano has to do with the “milk and biscuits” that the development team left to investors. In other words, the Cardano developers provide transparent updates regarding the direction the network will go next.

For example, in July 2020, the Shelley upgrade was launched. This upgrade increased the number of nodes that users could run on the network. Following this upgrade, the average number of daily transactions on Cardano’s blockchain increased from around 2,000 to over 100,000.

In September 2021, the long-awaited Goguen update debuted. Goguen brings smart contract capability to the Cardano blockchain, which in turn allows for more complex transactions. Goguen is Cardano’s ticket to becoming a serious threat to Ethereum.

Looking to the future, the Hydra upgrade is what’s going to make all the noise. Hydra will maneuver transactions to off-chain staking pools (for example, hydra nodes), which will allow rapid scaling without negatively affecting the processing efficiency of the main blockchain. In short, this means that Cardano could eventually blow out 24,000 TPS of water.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of the Motley Fool Premium Consulting Service. We are diverse! Asking about an investment thesis — even if it’s our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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