Here are 5 altcoins to study as crypto prices plunge near a yearly low

“Pain trading” has been an unwelcome sight in the cryptocurrency market since early 2022, and over the past 24 days, Bitcoin (BTC) and altcoin prices have fluctuated, leading some analysts to believe a bear market is imminent.

Despite traders’ concerns that another extended crypto winter could begin, At times like these, investors can take advantage of great opportunities to buy fundamentally sound cryptocurrencies at a discount.

Crypto Fear and Greed Index. Source: Alternate

With that in mind, here’s a closer look at several projects with strong fundamentals and a proven use case that could be good candidates to stockpile during the current market correction.

Polygon (MATIC)

Here are 5 altcoins to study as crypto prices plunge near a yearly low
Here are 5 altcoins to study as crypto prices plunge near a yearly low

Ethereum (ETH) layer-2 scaling solution Polygon (MATIC) is currently down 50.76% from its all-time high of $2.92 set on Dec 27, 2021.

MATIC/USDT 1-day chart. Source: TradingView

Polygon has seen strong growth and adoption throughout 2021 as its Ethereum compatibility and low transaction costs have made it a destination for users and protocols looking for a way to stay on the Ethereum network and enjoy the highs avoid transaction costs.

Total MATIC wallets over time. Source: Dune Analytics

The network is capable of hosting all sorts of decentralized applications, including lending protocols like AAVE, decentralized exchanges like Uniswap, or games and non-fungible token projects like Aavegotchi.

With the features and final launch date of Eth2 still unknown, it is likely that Layer 2 solutions like Polygon will continue to see increasing adoption as users seek lower transaction fees.

Phantom (FTM)

Fantom (FTM) is a Layer 1 blockchain protocol that also gained traction in 2021 as its low-fee environment and Ethereum Virtual Machine (EVM) support helped attract new users and protocols to the network.

FTM/USDT 1-day chart. Source: TradingView

Data from Cointelegraph Markets Pro and TradingView shows that FTM’s price is currently down 36.3% from its December highs, trading at $2.15 at the time of writing.

The bull case for FTM is being helped by the continued rise in Total Value Locked (TVL) on the Fantom network despite the market-wide pullback, with data from Defi Llama showing that Fantom TVL is currently at an all-time high of $12.07 billion.

Total locked in Fantom. Source: Defi Llama

Compared to competing networks like Solana (SOL), which has a TVL value of $7.62 billion, Fantom has more value and hasn’t experienced major network outages like Solana, but trades at a significant discount to the sun’s price .

Since SOL is currently priced around $90, FTM would need to be priced at $18.10 to have an equivalent market cap, suggesting that Fantom is undervalued compared to its Tier 1 peers and has the potential to close this gap over the course of 2022.

Polkadot (DOT)

Another token that could potentially be in a good accumulation zone is Polkadot (DOT), a fragmented multi-chain protocol that aims to facilitate the cross-chain transfer of any type of data or asset across multiple blockchain networks.

Data from Cointelegraph Markets Pro and TradingView shows that DOT’s price has been declining since early November 2021 as the token outpaced its cohort of Layer One projects, possibly due to the lack of a bridge that works with Ethereum.

DOT/USDT 1-day chart. Source: TradingView

That all changed on January 11th when Polkadot’s Parachain Moonbeam (GLMR) officially launched, establishing the first cross-chain bridge for the Polkadot network. As of January 24, Moonbeam has processed more than 1,329,000 transactions and supports more than 700 ERC-20 tokens.

As other parachains are officially launched on Polkadot in the coming months, DOT has the potential to see increasing demand and price for the token as users seek to participate in the Polkadot network.

Polkadot ecosystem. Source: Polka Project

Curve (CRV)

When it comes to the growing importance of stablecoins in the cryptocurrency market, the Curve DAO token has become one of the most coveted tokens by investors and protocols vying for governance control of the crypto market platform.

CRV/USDT 1-day chart. Source: TradingView

After hitting an all-time high of $6.80 on Jan. 4, CRV price is down 60% and is now trading at $2.76 according to TradingView data.

Despite the drop in CRV price, the ongoing “Curve Wars” suggest that demand for the token is likely to increase once the market’s current weakness abates as decentralized finance projects seek governance powers over the Curve ecosystem .

At the time of writing, a total of 49% of the circulating CRV supply is locked in veCRV, the voting token for the Curve protocol.

Percentage of CRV tokens locked on Curve. Source: Dune Analytics

FraxShare (FXS)

Another protocol that appears to be playing a bigger role in the stablecoin space is Frax Share (FXS), the first fractional algorithmic stablecoin system in the cryptocurrency space, which gained traction in late 2021.

FXS/USDT 4 hour chart. Source: TradingView

The protocol’s stablecoin FRAX has become a favorite of DeFi fans, largely thanks to its decentralized nature in a space dominated by centralized projects like Tether (USDT) and USD Coin (USDC).

As a result of its launch, FRAX’s total transaction volume has increased over the past six months and is currently at an all-time high of $6.3 billion.

Monthly FRAX volume. Source: Dune Analytics

FXS bullish momentum is supported by a steadily rising Total Value Locked, up 30.53% over the past week and 86.9% over the past month, hitting a record $2.28 billion on Dec. 24 reached. as the prices of almost every other asset in the crypto market fell.

Total value locked in Frax Share. Source: Defi Llama

With FRAX now being adopted in DeFi by users looking for more decentralized stablecoin options, FXS could also see an increase in demand and price for the token as the importance of trusted stablecoin protocols increases.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should do your own research when making a decision.

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