What happened
Today’s price action among various altcoins that have outpaced the broader market by a wide margin are grabbing attention. As of noon ET, Polkadot (DOT 5.87%), Solana (SOL 4.52%), and Cardano (ADA 0.76%) are tokens that are gaining steam, surging 7.2%, 5.1%, and 2.7%, respectively, over the past 24 hours.
Amid a range of bullish catalysts that have taken the cryptocurrency sector higher, many investors remain focused on Ethereum‘s upcoming Merge. With this update set to revolutionize the world’s largest decentralized finance (DeFi) ecosystem via a move to proof-of-stake consensus validation, other proof-of-stake altcoins are starting to pick up steam as Ethereum alternatives.
Polkadot’s surge appears to be tied to recent reports that the Web3 Foundation exceeded 400 project grants on Polkadot. This suggests that Polkadot’s ecosystem growth rate could be better than many investors expect.
Solana has moved higher, brushing off concerns around a controversial report released this past weekend that indicated much of the DeFi growth the Solana ecosystem may have seen over the past year was fraudulent. Investors are instead seemingly choosing to focus on the positives with Solana today, including bullish commentary from a Solana Labs co-founder around the future of the non-fungible token sector, and where Solana fits into this future.
Finally, Cardano has continued to battle headwinds of its own, tied to delays with the network’s Vasil hard fork. However, data showing a surge in Cardano wallets (to more than 3.5 million), and developer interest in the Cardano blockchain (which makes this among the most developed blockchains in the world), is prompting buying interest from investors today.
So what
Polkadot, Solana, and Cardano are three projects that have been called “Ethereum killer” projects in the past, due to the ecosystem growth they have seen over time. Despite broad-based token price declines in the crypto sector, activity on these blockchains has certainly enticed investors to stay invested during this period of volatility. If activity is any gauge, these altcoins could be poised for outsize strength during the next crypto rebound, which may or may not be underway right now.
That said, concerns around the quality of the data currently being published on the crypto sector does provide investors with some pause. Reports that Solana developers may have been able to fake total value locked metrics makes differentiating crypto projects with “real” growth versus those with exaggerated growth more of a task.
Now what
This risk-on rally we’ve seen play out in recent weeks has led to impressive rallies across a number of select cryptocurrencies. The extent to which this crypto rally, which has more than kept pace with the rise in stocks of late, can continue remains to be seen.
That said, these three projects are ones worth keeping on the radar. For long-term investors looking for growth, these cryptos are ones with growth data that appears to support a growing valuation over time.
Chris MacDonald has positions in Ethereum and Solana. The Motley Fool has positions in and recommends Ethereum and Solana. The Motley Fool has a disclosure policy.
