Solana (SOL) was the altcoin that suffered the most from the collapse of FTX. But there are also a few exciting developments waiting for early 2023. Avalanche (AVAX) may finally deliver on some of its early promises by signing a major partnership agreement with Amazon. Cardano (ADA) is completing a major new decentralized finance initiative in 2023. Motley Fool crypto expert Dominic Basulto takes a close look at three altcoin projects.
Solana, Avalanche and Cardano want to rebound in 2023
By almost every metric, 2022 has been bad for almost every cryptocurrency. As a result of sudden market booms and spectacular crypto crashes, there has been a severe erosion of investor confidence in crypto as an asset class. Both Bitcoin and Ethereum fell more than 65%. In a year like this, risky altcoins have been hit even harder, and some have lost 90% or more of their value.
The real question, of course, is whether or not investors oversold some of these coins as part of their panic-stricken flight over quality. If you’re looking for an antiquated approach to 2023, it’s time to start looking for hidden values in the crypto market. Here are three counter bets for the year ahead, and a brief explanation of why each could launch in 2023.
The top altcoin Solana (SOL)
Solana (SOL), which dropped almost 95% in 2022, was one of the worst performing cryptocurrencies. The year started badly for Blockchain with a series of network outages and got worse and worse. First, there was a crash in the Non Fungible Token (NFT) market, with Solana making steady progress as a potential Ethereum competitor. Second, in November, the extraordinary collapse of crypto exchange FTX took place, when investors panicked after realizing how important the role that former FTX Chief Executive Sam Bankman-Fried played in funding and promoting Solana.
In proof of how panicked investors were in 2022, Solana has already grown by a staggering 130% in 2023. Considering it was trading around $34 before all the FTX drama started, I’m setting a base price of $34 for Solana at the end of 2023. This still represents a roughly 50% increase from today’s price of $22. The price has the potential to be much higher when you add in all the initiatives Solana has planned for this year. These are the launch of a crypto phone and a comprehensive Solana Mobile strategy for Web3.
Another Ethereum competitor, Avalanche (AVAX), is also on the list.
Avalanche was another cryptocurrency, down nearly 91% in 2022. In part, this had to do with underlying issues such as blockchain outside decentralized finance (DeFi) and its failure to gain traction in any niche of the crypto world. And in part, it had to do with investors giving up Avalanche as a potential Ethereum competitor.
In 2021, Avalanche was a potential ‘Ethereum killer’. But that was back when Ethereum was still a cumbersome, slow and inefficient proof-of-work blockchain. cryptocoin.comAs you follow, Ethereum is now a faster, energy efficient and more scalable PoS Blockchain. That’s why Avalanche suddenly doesn’t look all that great in comparison.
Or is it? In January, Avalanche became the first Blockchain to partner with Amazon Web Services (AWS), the Amazon cloud computing unit. Long story short, Amazon chose Avalanche over Ethereum. This could be huge news for Avalanche in terms of its future growth. As part of the partnership arrangement, Avalanche will become the Blockchain of choice for any organization or government client of Amazon Web Services. As one of Avalanche’s co-founders put it on social media: “This is very important. This is not your grandfather’s AWS partnership announcement.”
Last-ranked Ethereum rival altcoin Cardano (ADA)
Finally, there is Cardano (ADA), which is down more than 80% in 2022. Investors were annoyed by Cardano as no development seems to be happening on Cardano Blockchain. There is an upgrade after an upgrade, an announcement after an announcement. However, key metrics like locked aggregate value (TVL), which is still a popular indicator of total Blockchain activity, never seem to move.
However, this may change in 2023. Cardano is making an aggressive entry into DeFi this year, thanks to a number of upgrades that enable smart contracts on the blockchain, and other DeFi-related innovations such as decentralized exchanges (DEX). Meanwhile, there are plans to launch two Cardano stablecoins as well. These initiatives will increase TVL. So this may eventually convince investors that something is really going on with Cardano.
year of dissent
All three (Solana, Avalanche, and Cardano) are still among the top 20 cryptocurrencies in the world when measured by market cap. At times, they have all been cited as shining examples of where cryptocurrency is going. That’s why it’s hard to believe that they’re all suddenly 80% to 90% less valuable than they were 12 months ago.
Unfortunately, all three faced a perfect storm in 2022. So many crypto projects were exploding, exploding, melting and crashing that investors panicked. This has reduced the value of many cryptocurrencies below fair value. With that in mind, I give these outliers a full seal of approval. There are many core values for each and each has a strong growth catalyst for 2023.
The opinions in the article belong to the experts and are definitely not investment advice. We recommend that you do your own research before investing or trading.
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