Sam Rexford is a crypto and NFT enthusiast who writes about crypto trading, altcoins, NFTs, and blockchain technology at chillreptile
A lot has changed in the crypto markets over the last year, with exponential growth seen across the cryptocurrency and NFT spaces.
Since the last post on the subject in 2021, the crypto market has experienced major developments – including a bear market – which is still affecting the industry, mostly in a bad way.
In this article, we will cover how the number of cryptocurrencies and NFT collections evolved in 2022.
How has the cryptocurrency market grown since 2021?
With cryptocurrency investing becoming more and more popular, and the number of options growing exponentially, it’s becoming harder and harder for savvy investors to sort through all the projects and find viable assets to invest in.
And it’s only expected to keep growing.
According to CoinMarketCap, the number of cryptocurrencies has seen a huge surge from 6241 to a whopping 20949 over the past year.
On the other hand, data from AugustaFreePress.com suggests that there are only 10,000 cryptocurrencies.
According to the new study, the number of cryptocurrencies kept rising from 6,000 in July 2021 to nearly 10,400 crypto assets in February 2022, averaging almost a thousand more cryptocurrencies entering the market each month.
However, in August of 2022, the number of cryptocurrencies decreased to around 10,000, which is the first time the number decreased in years.
The number of crypto assets decreased mainly due to the bear market conditions.
In fact, during these crises investors become warier of scams, causing investment funds to dry up, which has led to new projects going bankrupt before launching and making scammers less eager to launch new crypto scam tokens.
At the time of writing this article, the crypto market cap is a bit less than 1 trillion USD.
After reaching its peak of around $2.9 T, the crypto market cap has been decreasing in value since mid-November 2021 and is currently fluctuating at the levels of early January 2021.
Are cryptocurrencies here to stay?
According to the Crypto Market Sizing report, the number of crypto owners worldwide made a 178% increase in 2021 rising from 106 million in January to 285 in December.
Even though the numbers of crypto owners are rising at a significant rate, the global crypto population has the potential to grow even bigger. However, there are several obstacles that are preventing cryptocurrency from going more mainstream:
The lack of regulations:
While several countries are regulating cryptocurrency investing, most of them don’t have clear rules and guidelines. For instance, Turkey, Russia, Brazil, and India, among numerous other countries, haven’t done any progress in regard to cryptocurrency regulations.
The lack of regulations makes people wary of crypto trading and prevents mass adoption across various states.
Despite crypto enthusiasts’ promotion of Bitcoin as a store of value, the recent market trends are showing that bitcoin lost more than 70% of its value at its peak, making it an unreliable store of value.
The high volatility of crypto assets makes the general population view them as risky investments compared to gold, for example.
A look at the positive side of things:
On the positive side of things, crypto is slowly being adopted and used by companies and financial institutions, and for the first time, entire countries. In fact, El Salvador was the first nation to adopt Bitcoin as a legal tender.
Add to that, banks are integrating crypto assets into their services. For example, Goldman Sachs started offering bitcoin-backed loans by the end of April 2022, in a step toward more crypto adoption.
Different categories of cryptocurrencies:
There are a ton of types of digital assets, making it hard to keep track and count them all.
After Bitcoin’s creation, other blockchains were released, which are called altcoins. The top altcoins ranked by market capitalization by market capitalization are Ethereum, BNB, and XRP.
Add to that, there are tokens, which are built on top of blockchains. The biggest tokens by market cap are mostly stablecoins, with Tether (USDT) and USDC being the third and fourth largest cryptocurrencies by market cap respectively.
How many cryptocurrencies are there “really”?
Many websites and YouTube channels are creating comprehensive guides for blockchain development daily.
This trend made creating new tokens so easy and accessible that anyone with the least programming skills can copy an existing token’s code, change some variables, and deploy it on a blockchain like BSC (Binance Smart Chain).
This makes it extremely hard to find the actual number of cryptocurrencies.
Not only that but due to a large number of scams and rug pulls in the crypto space, many cryptocurrencies end up being abandoned by their developers. Despite being abandoned, these digital assets continue to be listed on CoinMarketCap, even with little to no trading activity.
How to spot a viable crypto project?
Spotting viable crypto projects takes a lot of time and dedication. It is recommended that investors take their time to learn about the existing projects and trends within the industry before buying their first cryptocurrency.
Investors should read a project’s whitepaper, check out the team behind the cryptocurrency, and the project’s tokenomics. Add to that, they need to make sure that the project has enough funding through VCs (Venture Capitals) or other sources, especially considering that we are in a bear market.
How many NFT collections are there in 2022?
The number of NFT collections has seen a huge surge in the first four months of 2022. According to the crypto analytics platform Into The Block, the number of NFT collections on the Ethereum blockchain rose by %104.5 in 2022 alone.
On opensea.io alone, there are 1000s of NFT collections, and that’s just one NFT marketplace.
As for NFT trading volume, data analytics from Into The Block shows that while the volume of traded NFTs has been declining from its peak in February 2020, the aggregate value of traded NFTs increased to nearly $55B in July 2022.
Let’s take a look at one of the most popular collections.
BAYC: short for “Bored Ape Yacht Club”, this collection consists of 10000 Bored Ape PFPs (Profile Picture NFTs). Minted on the Ethereum blockchain, these NFTs grant their owners unique membership perks, such as accessing a collaborative graffiti board called “The Bathroom”.
The collection’s market cap currently sits at $1.28B. According to data from Into the Block, the average price for a BAYC NFT is 94.66 ETH, up 5.23% from last month, and the trading volume is 14.99K ETH, up 30.48% within the last month.
The bear market that started in 2021 has had a huge impact on the growth of crypto projects, NFT collections, and the industry in general.
Even though most projects are down 80%-90% from their ATHs (All Time Highs), the bear market can help filter the noise by eliminating scams and projects with no foundations in general.
It is a great opportunity for investors to make life-changing gains if they can spot solid projects and NFT collections.