Top Crypto Investment Narratives For 2022

According to reliable market trackers, the crypto market is currently valued above $2 trillion. The number of tokens has grown to over 16,900, and that figure is still going up. This growth has been inspired by continued innovation within the space, and the growing acceptance that digital assets are the future of the financial industry. Individuals who got involved with promising projects early have been lucky to see their fortunes change tremendously thanks to the incredible ROI realized. Every investor's goal is to make the most of the opportunity presented by digital assets.

However, picking the winners from the losers is not an easy task. The sad truth is only a tiny fraction of projects succeed, and most disappear to oblivion, leaving investors to curse their luck.

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Top Crypto Investment Narratives For 2022

The rule of thumb when it comes to picking worthy digital assets to invest in is to check what kind of utility the project offers. Also, assessing the team, tokenomics, and listening to what experts have to say about the project can help.

Another way to identify projects with potential is to understand the investment narratives of the time: what the crypto investor community is excited about, or what potential gems lie within the sector. This piece will explore what narratives are likely to influence investor decisions in 2022.

NFTs

There is a lot of buzz surrounding the market, given the possibilities of NFTs fueling the metaverse economy. NFTs were the standout investment options for last year and should continue to be even in 2022. NFTs are different from coins/tokens due to their customizability and tendency to form closed and anonymous communities.

Over a short period of time, NFTs have successfully evolved to represent a different new sector of the crypto economy. Today there are all types of NFTs, such as CryptoPunks and Bored Ape Yacht Club, that cater to people's desire to be recognized and feel important.

An analysis done last November by JPMorgan values this market at about $7 billion, even though some experts believe it's around $22 – 44 billion. It is clear that targeting projects within this sector should put you in a good position, while holding tokens that belong to protocols that are enabling the launch of NFTs should also serve you well.

Ethereum Scaling Solutions & Alternatives

Several projects are trying to scale Ethereum and blockchains in general, such as Polygon, Terra, Solana and Avalanche. These projects represent the biggest winners in providing scalability/bridges for layer 1 protocols such as Ethereum. As the crypto market grows in terms of use cases and individuals, there is a need for faster transaction processing at cheaper fees. Also, the ability to spend different assets on any chain is growing. Therefore, the need to scale and bridge various protocols is apparent, and protocols offering these solutions should continue to grow this year.

Crypto Gaming and Metaverse Environments

So far, the crypto economy has focused most of its attention on developing decentralized networks. However, as more successful implementations of these networks are realized, you should see an increasing demand for users looking to do something with these networks. This is tied to the growth of the NFT sector.

Some experts are pretty bullish on Play-to-earn (P2E) crypto gaming and metaverse environments. Over the past year, Axie Infinity has exploded thanks to its P2E games. Also, with the market focusing on the development of the metaverse sector, the likes of Decentraland and Sandbox have also experienced tremendous growth.

Crypto gaming is one area you need to pay close attention to this year, since hundreds of gaming studios are working on developing crypto native games. However, it is important to note that this growth will expand beyond the traditional idea of gaming.

A few decentralized metaverse environments already exist, and more are coming up. These "games" allow participants to buy and develop virtual land from which they can earn. For example, functional metaverse environments such as Decentraland and Sandbox mirror the gameplay of GTA 5 or Minecraft. However, what makes them unique is the incorporation of tokens, NFTs and decentralized networks.

Even Bill Gates believes that "the metaverse will host most of your office meetings within 3 to 5 years." This can only be the result of the "virtualization" of our society. As the world becomes increasingly virtualized, people will spend most of their time in the best environments. The metaverse will be fully immersive, bringing the physical and digital world together. Of course, a lot of work needs to be done to achieve this reality, and crypto assets are playing a vital role in shaping this future.