The 2021 cryptocurrency market was a great year. Most investors were thrilled to see Bitcoin (BTC), which reached a record $68,789. ETH (ETH) also experienced a parabolic rally, with its price climbing 565% since Jan. 1, to reach a record high of $4,859 on November 10.
It was a great year for large-cap cryptocurrencies. However, the most significant gains and most important developments were made in the altcoin markets where decentralized finance and nonfungible tokens (NFTs), rallied by thousands and helped to bring about a new level awareness and adoption of blockchain technology and cryptocurrency.
Let’s take a look at five altcoin companies that have made significant contributions to the cryptocurrency ecosystem by 2021.
Since its launch in summer 2020, the decentralized exchange Uniswap has had the most impact on crypto ecosystem. The DEX saw significant growth through 2021. It helped to facilitate thousands of new crypto projects due to the removal of barriers that were present on centralized exchanges.
Dune Analytics data shows that Uniswap was the dominant DEX for the year, and has seen consistent trading volume greater than all other DEXs.
Monthly DEX volume per project. Source: Dune Analytics
The chart shows that the volume of decentralized exchanges traded grew in the second half 2021, largely due to activity on Uniswap.
Uniswap was a leader in the field of development throughout 2021. The protocol developers announced the release in March of Uniswap v3 The v3 upgrade was a combination of multiple protocol upgrades. It also provided the foundation for layer-two scaling solutions such as Optimism or Arbitrum to be integrated with Uniswap to reduce transaction costs and processing time.
Aave (AAVE), a DeFi lending protocol, allows users to deposit tokens and lend them out to earn a yield.
AAVE was a popular community choice as the DeFi sector began to gain momentum in early 2021. This is due to the large number of crypto assets supported and the support from well-funded players.
AAVE v2 was released in December, which included support for Polygon, a layer two scaling solution, as well as Avalanche which is a cross-chain blockchain network.
Total liquidity under the AAVE protocol. Source: Aave
These added capabilities have made AAVE the most valuable DeFi protocol in terms of total value locked (TVL) and has made it the largest available liquidity protocol.
Curve Finance, a protocol that focuses on stablecoins, uses an automated market maker to manage liquidity across the DeFi ecosystem and on the platform.
Because they provide liquidity to the market and offer protection for traders who need shelter from volatility, stablecoins are a key piece of the cryptocurrency community in 2021.
Curve protocol and its native Curve CRV have been benefited by stablecoins’ increasing importance. Curve protocol has accelerated its integration of stablecoins in many top DeFi protocols including Convex Finance and Yearn.Finance.
Despite the fact that stablecoins make up a large portion of assets on Curve protocol, Curve is still the most popular protocol in terms TVL, behind AAVE. Data from Defi Llama shows that Curve vaults hold $21.77 billion.
Curve has a total value. Source: Defi Llama
Curve also integrates with many of most active blockchain networks including Ethereum, Avalanche and Harmony. This is further proof of Curve’s desire to be the stablecoin liquidity provider in the crypto market.
Related: The US Financial Stability Oversight Council has identified cryptos and stablecoins as threats to the financial system
Axie Infinity, a play to earn (p2e), trading and battling game, allows players to breed, raise, fight, and trade NFT-based Axies.
The p2e model became a popular choice in 2021 due to its ability to provide users with a daily income along with their gameplay. This model offers some unique advantages over traditional pay-to play.
Axie Infinity’s popularity grew, and so did the native AXS token. This was an all-time record. The platform’s peak on August 6 saw a $17.55 million daily revenue.
Axie Infinity Price vs. Total Revenue Source: Token Terminal
Axie Infinity was also among the first projects to start the trend of people leaving the Ethereum network due to high fees and slow transactions. The project moved to the Ronin sidechain earlier in the year and launched Katana, its own DEX in November.
Dogecoin, an open-source proof-of-work cryptocurrency that is proof of its work, has been a major player in the field of “meme coins” that have made headlines throughout 2021.
Although the project is not able to make any significant contributions in the area of technology or development, frequent shilling by the likes Elon Musk, Shark Tank star Mark Cuban and Tesla CEO Elon Tesla helped Doge to a 23,746% rally which saw the price go up from $0.0031 on January 1 to an all time high of $0.74 on June 8.
DOGE/USDT 1-day chart. Source: TradingView
In addition to the DOGE price gains, the token attracted more attention after it was announced it would be used for funding the launch of a Lunar satellite by SpaceX. The Dogecoin movement also launched a meme-coin rally that spawned a slew of copy-dog projects like Dogelon Mars and Shiba Inu (SHIB).
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Eileen Wilson –Technology and Energy
My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.