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Why did some blockchains fare better than others? An overview of this cycle’s best and worst cryptocurrencies

11/30/2022 | 10:54am EST

The bear market has been a test of strength for all blockchains, and it is clear that some have fared better than others. Now that we may be nearing a bottom, it is a good time to look closely at some of the biggest blockchains’ native currencies and see the results their respective strategies have yielded.

Using Bitcoin (-70% YOY) as a yardstick for blockchains aiming at providing a better money, and Ethereum (-72% YOY) – for those created as smart contract platforms, we can see how divergent the wider crypto landscape is.

This is an overview of this crypto cycle’s worst and best performers (for the coins with over $1 billion market cap), together with a short assessment of the underlying reasons.

The worst-performing blockchains

There’s nothing better than a recession to test the foundations of a blockchain, both tech- and market-wise.

Terra’s inherent architecture flaws have led to its spectacular crash and secured it the first place on the losers’ list.

Solana ($SOL -94% YOY), a PoS blockchain that saw a meteoric rise in the last three years, may very well take the second. Positioned as “Ethereum-killer”, it offered higher scalability and cheaper transactions (although with occasional network halts), all while deploying significant efforts to attract developers and nurture all kinds of crypto projects.

There’s no doubt Solana was doing great marketing, but this may be exactly what scares the market now, raising a legitimate question: “Is there a real need for Solana or has its development been artificially pumped?” The FTX demise has only increased the doubts: the defunct exchange and SBF personally were highly involved in Solana’s development, which now causes it a great deal of reputational damage.

As to The Internet Computer ($ICP -90% YOY), Avalanche ($AVAX -89% YOY) and Algorand ($ALGO -86%), these blockchains were hoping to establish themselves as better smart contract platforms, but weren’t able to produce any significant argument (yet?).

The best-performing blockchains

Among blockchains serving primarily as money, the best yearly performance award goes to the The Open Network ($TON -41% YOY). Launched by the founders of Telegram (which have since distanced from the project), TON is one of the youngest cryptocurrencies and is tightly linked to Telegram. The wallet bot released this spring allowed Telegram users to buy, sell and transfer $TON within the app, and this week’s update has added a fully functioning crypto wallet to it. $TON is also very active in several African countries, where the need for a mobile-based money is the biggest.

Monero ($XMR -41% YOY), a legacy privacy blockchain, did well too. This is mostly due to its under-performance during last year’s rally, but it also shows a stable demand for anonymous crypto transactions.

Another good performer in this category is Dogecoin ($DOGE -52% YOY), which also did not rally last year as much as the rest of the market. What’s more, it strongly reacted to Elon Musk buying Twitter: the “Dogefather” has on numerous occasions supported the memecoin, and the possibility of $DOGE playing some role in the future of the social network has injected hope into the community.

Among smart contract platforms, quite surprisingly it is Tron ($TRX -44% YOY) that has lost the smallest percentage of its price since last year. Widely considered as an underdog (not least due to its controversial founder Justin Sun), Tron raced less than other blockchains last year, all while steadily developing its specialization in web3 media. Justin Sun’s previous acquisitions of Bittorrent, a distributed data storage service, and Steem, a web3 social media platform, also played a role in market confidence.

The success of BNB Coin ($BNB -51% YOY), on the other hand, was largely expected. Powering the BNB Chain launched by Binance, $BNB price reflects the expectations of the immense network effect and synergy with the exchange giant and its numerous ventures.

Polygon ($MATIC -56%), a layer-2 solution on Ethereum, which is slowly morphing into being a blockchain of its own, has performed well too. Acting as a “cheaper Ethereum”, it has attracted many DApp projects targeting general public and signed a number of high-profile partnerships (Starbucks, Reddit and Disney among others).

Finally, it seems like Ripple ($XRP -59%) is expected to soon break through on the web3 market. A conservative blockchain, primarily aiming at facilitating inter-bank transactions, has started showing signs of change, announcing this summer The Open Metaverse project. It is also expected to come out victorious of its long-going court case vs the SEC.

Written by D.Center


© MarketScreener.com 2022
Stocks mentioned in the article
ChangeLast1st jan.
ALGORAND (ALGO/USD) -3.63% 0.2574 End-of-day quote.45.18%
AVAX S.A. 1.08% 0.94 Delayed Quote.23.68%
BITCOIN (BTC/EUR) -1.53% 21270.3 End-of-day quote.37.24%
BITCOIN (BTC/USD) -1.68% 22940.8 End-of-day quote.38.08%
DOGECOIN (DOGE/USD) -3.74% 0.0921 End-of-day quote.31.20%
ETHEREUM (ETH/BTC) -0.56% 0.07104 End-of-day quote.-1.66%
ETHEREUM (ETH/EUR) -2.08% 1511.04 End-of-day quote.34.96%
ETHEREUM (ETH/USD) -2.23% 1629.8 End-of-day quote.35.81%
MONERO (XMR/BTC) -1.49% 0.007273 End-of-day quote.-18.59%
MONERO (XMR/USD) -3.23% 166.38 End-of-day quote.12.39%
SOLANA (SOL/BTC) -1.92% 0.001023 End-of-day quote.70.30%
SOLANA (SOL/EUR) -3.42% 21.77 End-of-day quote.133.68%
SOLANA (SOL/USD) -3.57% 23.49 End-of-day quote.135.14%
STARBUCKS CORPORATION -4.44% 104.3 Delayed Quote.5.14%
TESLA, INC. 0.91% 189.98 Delayed Quote.54.23%
WALT DISNEY COMPANY (THE) -2.21% 110.71 Delayed Quote.27.43%
XRP (XRP/BTC) -1.36% 1.737E-5 End-of-day quote.-14.81%
XRP (XRP/EUR) -2.87% 0.3684 End-of-day quote.16.55%
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