The 24-year-old founder of a crypto research firm shares 3 altcoin tokens that could lead to the biggest market event in 2022. Jack Niewold is the founder of altcoin research firm Crypto Pragmatist. Niewold says his strategy is to identify cash-flowing altcoins that can skyrocket. It shares 3 tokens that will most likely shape and make a name for crypto in 2022.
Shared 3 altcoin projects
As Bitcoin hit a new record hashrate on Jan. 3, investor sentiment around the biggest cryptocurrency turned bearish. But not all crypto assets started the new year on a negative note. According to data from CoinMarketCap on Tuesday, coins among the top 100 cryptocurrencies by market cap rose more than a third over the past week, while Bitcoin fell over 4% in the same period. Some crypto investors have argued that altcoins‘ superior performance against Bitcoin is a sign that the tokens, backed by different technologies and strong fundamental values, are diverging from the original cryptocurrency.
“I think this is a really exciting time to be a crypto investor,” said Jack Niewold, founder of Crypto Pragmatist, which aims to provide institutional-grade altcoin research for individual investors. The 24-year-old executive first entered Bitcoin and Ethereum in 2017, but analysis of altcoin indices has helped him realize the potential for greater returns in smaller cryptocurrencies. While Bitcoin’s 60% return last year outstripped those of major traditional assets, it pales in comparison to SOL, AVAX and LUNA, which rose 7,874%, 3,020% and 13,075% last year.
How to identify cash-flowing altcoins?
Niewold is looking for information on projects that are gaining momentum on social media platform like Twitter. It also tracks cryptocurrencies that are rising in market cap or moving against the market. Once a set of potential hidden “gems” has been identified, it applies a combination of crypto-native metrics such as locked aggregate value and traditional financial metrics, including price-to-earnings, to analyze them. If, after the early review process, he cannot conclude from data-centric analysis that a token is undervalued, he will read the project’s whitepaper, check the dispute channels and ask questions. Niewold focused mainly on cash-flowing altcoins, which are tokens of businesses run on the blockchain. He explains that these projects can distribute cash flows to token holders through buybacks. There are also protocols that pay cash flows in the form of other cryptocurrencies.
3 altcoins on your radar
In Niewold’s view, the crypto market is split into bearish and bullish outlooks in 2022. He feels that in such an uncertain market backdrop, following narratives in crypto is more beneficial than following specific tickers. One of the narratives that could shape crypto this year is increased liquidity as DeFi protocols follow or fight for liquidity. This is already playing out in what has recently been called “Curve Wars.” Curve Finance offers the CRV token as a governance token; This means that the token grants voting rights. As DeFi protocols race to accumulate CRV tokens to tip the vote in their favour, this has put buying pressure on the CRV token, which has risen 68% last month, according to data from CoinGecko.
Other tokens associated with this narrative include Redacted Cartel (BTRFLY) and Convex Finance (CVX). According to Delphi Digital, Convex Finance has the most impact on Curve’s liquidity incentives, with 85% of Curve’s total value driven and staked on Convex. Another narrative that has shaped the market this year is the potential boom in Ethereum’s second-layer networks. Layer one protocols refer to the underlying blockchain such as Bitcoin, Ethereum, and Solana, while layer two networks are third-party integrations that can often be combined with layer one blockchains to increase their scalability and efficiency. Niewold said, “2021 was the year of the layers that we saw Solana, AVAX and Terra lift off. “I think 2022 could be the year Ethereum resists,” he says.
In fact, many Ethereum enthusiasts have started using the “L222” hashtag on crypto Twitter to maintain momentum around second-layer networks, but the largest second-layer networks like Arbitrum, Optimism, and Zksync do not yet have native tokens. Traders anticipate that these networks will at some point airdrop the tokens to early users’ wallets as a reward, but this is not guaranteed.