Shiba Inu soared a mind-boggling 45,000,000% last year. It's unlikely many cryptocurrency players will climb that much in a 12-month period. But, this year, Shiba Inu may not be such a winner. There are plenty of other cryptocurrencies that could earn you more.
Let's look at two up-and-coming players that might beat Shiba Inu's performance this year. That's because they top Shiba Inu in one important area: real-world use. They both are blockchains with their own native tokens. Both have structures that favor efficiency -- that means speedy transactions. Speed is important because it results in lower costs and less congestion on the network. Of course, users prefer quick transactions. Let's find out more about these players that could beat Shiba Inu this year.
Algorand (ALGO -1.99%) is known for its transaction speed. Right now, the blockchain can process more than 1,200 transactions per second. The next goal is to reach 3,000. It's working on a feature that eventually will allow the processing of more than 45,000 transactions per second.
How does Algorand do it? The protocol structure is key. The blockchain includes two layers. The base layer is the place for smart contracts, the creation of assets, and certain basic transactions. The second layer is home to decentralized applications (dApps) and complex smart contracts. This structure prevents congestion that otherwise might happen if all operations took place on one layer.
Algorand also may win when it comes to non-fungible tokens (NFTs). This is because Algorand is forkless -- it won't split off into a new blockchain. In a blockchain that forks, NFTs could duplicate or become worthless. With Algorand, creators and buyers of NFTs avoid those risks.
Algorand has dropped 53% this year and is trading for less than $1. A few pieces of good news could quickly turn this player into a multibagger for investors.
Avalanche (AVAX 2.20%) emphasizes its time to finality, which is the time it takes to complete a transaction. That's less than two seconds, compared to about six minutes for bigger rival Ethereum. Speaking of Ethereum, another advantage of Avalanche is compatibility with that larger player. Developers can build dApps in the language of Ethereum and launch them on Avalanche. They can use a specially designed bridge to transfer assets between the two networks.
Avalanche also is making progress on overall efficiency. It's doing this through subnets. It recently launched an incentive program to boost the use of its subnet feature. Anyone can build their own networks with custom elements, and these networks are still part of the Avalanche system.
This crypto player is already showing its real-world use. Right now, more than 180 projects exist on Avalanche. They are in several areas, including decentralized finance, culture, and wealth management.
Avalanche has slipped 25% since the beginning of the year. But the above elements could help this crypto player rebound this year and extend gains into the long term.