Last year was a good time to be a crypto investor, as the alternative asset class received renewed optimism.
The largest cryptocurrency by market capitalisation, Bitcoin (CRYPTO: BTC), posted a 57% gain during the year. However, this pales in comparison to the outlandish performance of other cryptos and tokens in 2021.
When discussing investment returns we would usually be talking in the realm of tens or hundreds of percent. But today we'll be referencing returns in excess of 15,000% in a single year.
For this collection of best performing cryptocurrencies in 2021, we have filtered down to the top 100 by market cap, according to CoinMarketCap. This removes the lesser-known and more volatile cryptos from our view.
Without further ado, here are the five best cryptocurrencies/tokens of the year gone by.
Governance and metaverse tokens make top 5
Kicking off our list of the best performing crypto assets in 2021 is Terra (CRYPTO: LUNA). This blockchain-based protocol supports stable programmable payments using algorithmic means.
In other words, Terra, and its LUNA token, provide stability to cryptocurrencies. Simultaneously, the LUNA token acts as a governance token, which allows holders to vote on decisions for the underlying protocol.
An influx of decentralised applications being built on the Terra blockchain has helped this token achieve mind-blowing returns by the end of 2021. To be specific, the LUNA token was propelled 15,970% higher last year.
Beating out Terra in 2021 was a token that is well known in the metaverse community. The Sandbox (CRYPTO: SAND) token rapidly appreciated in value after Facebook announced its rebrand to Meta Platforms Inc (NASDAQ: FB) amid its push to be a big player in the digital world.
Being one of the most prominent names in blockchain-based digital worlds, The Sandbox and its native token enjoyed a substantial boost after Facebook acknowledged the metaverse in a big way. In turn, the increased attention pushed returns for The Sandbox token to 17,387% in 2021.
Great year for game-based cryptos amid NFT craze
Axie Infinity is a blockchain-based game that tapped the non-fungible token (NFT) explosion last year. The game's characters, known as Axies, are represented as NFTs — giving players ownership of their playable creatures.
Additionally, the game operates on a pay-to-earn model, allowing players to win crypto. Players can also exchange their Axie NFTs as another way to potentially profit from the game.
It appears the game has been a success, with daily active users surpassing 2 million. Similarly, the game's token Axie Infinity (CRYPTO: AXS) has erupted, gaining 20,043% in the span of 12 months.
This return might seem extremely impressive, yet the next best crypto on our list trumped those returns. The Gala (CRYPTO: GALA) token showered investors with profits in 2021, netting a staggering 49,368% gain at the end of the year.
Although Gala is also in the gaming realm, it's a little different from Axie Infinity. Setting it apart, Gala Games seeks to provide people with control over their games and in-game assets. In addition, the platform offers token holders the ability to vote on what games get funding and are developed.
From 'underdoge' to king of crypto returns
It wouldn't be the top five cryptos without the token that took the world by storm last year. Shiba Inu (CRYPTO: SHIB) is a decentralised cryptocurrency aspiring to be an Ethereum-based alternative to Dogecoin (CRYPTO: DOGE).
Many would know that these tokens are inspired by memes. However, some may not know that Shiba Inu is more than a meme. The Dogecoin alternative has created an entire decentralised finance platform, allowing users to exchange between different tokens and earn rewards from staking.
If you were an investor of Shiba Inu at the start of 2021 and held throughout the year, there's a good chance it's made you a millionaire. The crypto recorded a head-spinning 24,330,175% return last year.
