With Bitcoin (CRYPTO:BTC) and the cryptocurrency market as a whole experiencing some severe volatility in January, it's a good time to look for some opportunities, some of which are trading at a substantial discount to where they were just a few weeks ago, even as the networks themselves continue to make progress. Here are my top 3 cryptocurrencies to buy in February.
Fantom (FTM 0.05%) is down 13% since the start of 2022, even though the network enjoyed 3,000% growth in unique users and 18,000% transaction growth in 2021. Developers are flocking to Fantom to build apps like decentralized finance platform Beethoven X, decentralized exchange SpookySwap, and stablecoin platform Tomb Finance. Beefy Finance is an automated multi-chain yield optimizer that helps users earn interest on their crypto holdings. Beefy's founders have spoken favorably about the ease of building on the Fantom platform, its speed, and its low fees.
As an added bonus, Fantom looks like one of the most undervalued cryptocurrencies out there. Comparing its market cap to the total value locked (TVL) in the platform, Fantom seems undervalued. With a market cap of just over $5.7 billion and almost $9 billion in value locked in the platform, Fantom has a market cap to total value locked of just 0.65, compared to a ratio of 3.1 for Ethereum or over 4.2 for Solana (SOL -1.11%). I still think Ethereum and Solana are good investments, but this just illustrates how undervalued Fantom looks.
While not as cheap as Fantom, Avalanche's (AVAX -1.84%) market capitalization to TVL of 2.0 looks attractive as well. Avalanche took the cryptocurrency world by storm in 2021 but is currently down 20% since Jan. 1 as it cooled down with the broader crypto market drawdown. That decline offers a new buying opportunity for investors who thought they missed out on Avalanche during its run to $144 in November.
While the price is down, activity in the Avalanche ecosystem is surging. For example, since December, Terra's UST stablecoin and the USDC stablecoin launched on the Avalanche network. Another promising example is Pangolin, a decentralized exchange built on Avalanche that allows users to generate interest across Ethereum and Avalanche blockchains.
Trader Joe is a decentralized trading platform on the Avalanche network that is quickly growing in popularity. It rewards users with a share of exchange revenue utilizing the $JOE token.
Avalanche was recently tapped by consulting firm Deloitte to run a project helping local governments receive disaster relief funds from FEMA, and non-fungible tokens (NFTs) are beginning to take hold on the Avalanche blockchain.
Solana was one of the stars of the crypto world in 2021, establishing itself as one of the major blockchains. It has had a difficult 2022 so far, with a 35% decline year to date, but this presents a buying opportunity for investors. The Solana network boasts lightning speed, processing over 50,000 transactions per second. For comparison, Ethereum processes 30 transactions per second, and Cardano can process 250. Furthermore, Solana does this for a minimal transaction fee of $0.00001 to $0.00025, an attractive feature when many crypto users are concerned about Ethereum's high transaction fees, which can range from $4 to $20. A Bank of America research note recently lauded Solana as potentially becoming the "Visa of the crypto world."
Furthermore, while not as established as Ethereum's thriving NFT ecosystem, Solana is building a flourishing NFT scene of its own. Projects like Degenerate Ape Academy have had pieces sell for over $1 million. There is a bevy of interesting collections sprouting up on Magic Eden, one of the key marketplaces for Solana NFTs.