We will start this report by examining the assets and finish with price predictions. Let’s dive in!

Note:

Things you need to know while reading:

Appchain: a blockchain that is exclusively designed to operate one specific application instead of multiple apps as a public blockchain is designed to do.

Appchains operate on top of existing blockchains in order to take advantage of their security and gas fees. Blockchains that use appchains: Polkadot Parachains, Cosmos Zones and Avalanche Subnets.

Long-term: We have a minimum 2-year time frame and a maximum 4-year time frame for our goals. Price targets are determined by yearly changes in new supply, market capitalization (MCap), positive development outcomes, and favorable macroeconomic conditions – peak bull run.

Perspective of Selection

These L1s are our top picks because:

  1. Layer 1s have been battle-tested and have established themselves as essential to DeFi.
  2. Layer 1s who could be competitive in this sector. We anticipate strong performance from them in the upcoming bull run.

Since this is our first research report about Near Protocol, Osmosis, and Cronos, we have covered them more extensively than the others.

Ethereum (ETH)

On September 15th, The Merge, Ethereum’s most anticipated upgrade, will launch, radically altering its consensus mechanism (security) and tokenomics (token model). Our long-term target for ETH is $10,000 due to the Merge catalyst and Danksharding (improving Ethereum’s scalability upgrade) in 2023.

Target MCap at least $1 trillion.

Solana (SOL)

Ethereum is the king of DeFi, but Solana has proven to be the king of blue-chip NFTs. Solana started the year with congestion issues which slowed down the network. However, Solana has accomplished more than most L1s in just over a year. The upcoming fee market is implemented similarly to Ethereum, with users paying a premium to have their transactions (TXs) processed more quickly. Because of this, SOL will accrue more value and generate more revenue.

Additionally, Jump Crypto (a prominent Web3 infrastructure developer) and Solana are working together to create a separate second validator client in the C++ programming language. This action is crucial to enhancing the network’s decentralization and performance.

Our long-term target for SOL is $400

Target MCap: $200 billion, assuming all total supply is in circulation (508,180,963).

BNB Chain (BNB)

The fact that Binance, the largest cryptocurrency exchange in the world, is backing BNB Chain justifies its inclusion on this list even though it is not the strongest L1 available. Following Ethereum, BNB Chain generates the most revenue and DeFi liquidity. BNB has been one of the top 5 cryptocurrencies by market cap for at least a year.

Our long-term price target for BNB is $1000.

Target MCap: $250 billion. Only 2% inflation left. FDV will soon = current MCap.

Cosmos Hub (ATOM)

Cosmos (Layer 0) is an ecosystem of interconnected L1 blockchains. These L1s built on top of it connect using IBC, the Inter-Blockchain Communication protocol and share messages. The Cosmos Hub (Layer 1) is the first of thousands of interconnected blockchains that comprise the Cosmos Network. The primary token of the Cosmos Hub is ATOM.

The ATOM token does not accrue great value because its primarily used for governance. ATOM is not used to pay for TXs. The Cosmos Hub has proved vital in the IBC ecosystem and will always have hype regardless of its poor tokenomics.

Our long-term price target for ATOM is $55.

Target MCap: $25 billion.

Near Protocol (NEAR)

In October 2021, Near Protocol unveiled an $800 million ecosystem fund, and ever since, Near has experienced significant growth. Near Protocol claims to be scalable through the use of Nightshade, a sharding technology.

Near achieves EVM-compatibility with Ethereum in a unique way via Aurora, Near’s scaling solution. Ethereum developers can easily write solidity smart contracts and deploy existing dApps to Near through Aurora.

A smart contract’s creator receives 30% of the TX fees on Near. This mechanism encourages developers to build on the network because they can develop a dApp that will generate income for them in the future.

On Near, developers can choose to write smart contracts using JavaScript or Rust, making it easier for Web2 developers to create dApps rather than learning a specific language like Solidity.

The Octopus Network (OCT) is a multichain, interoperable network for launching application-specific blockchains, aka appchains on Near.

Octopus appchains are fully interoperable with Near. OCT tokens can be used as collateral for cross-chain assets between appchains and Near.

Our long-term price target for NEAR is $40.

Target MCap: $40 billion. The entire supply will be fully unlocked in October.

Mina Protocol

Mina Protocol is a 22-kb blockchain that enables anyone to participate in network security through a smartphone. Mina Protocol leverages ZK-SNARKs tech to allow use cases between the real world and Web3.

Off-chain verification and private scalable dApps are features that will enable Mina to assist the crypto industry. Mina is still under development, which accounts for its lack of traction.

The most anticipated event on Mina’s roadmap is zkApps, zero knowledge apps. ZkApps should go live in Q3-Q4.

Our long-term price target for Mina is $100.

Polkadot Ecosystem

Acala (ACA)

Acala is a Polkadot-based DeFi network that supports the Acala Dollar (aUSD) ecosystem and is EVM-compatible. Acala makes use of the Homa protocol to support liquid staking. Users stake their tokens, and in exchange, they are given L-Tokens (such as LDOT), which represent the principal asset and the continuously accruing staking yield.

Liquidity from various chains and token standards can be used for a range of DeFi activities on Acala.

Acala Dollar got exploited in August, and the chain is in maintenance mode until further notice. More on this incident can be found here.

Our long-term price target for ACA is $6.5.

Target MCap: $2 billion.

Astar (ASTR)

Astar Network either using WASM/rust or EVM/solidity offers developers various ways to write smart contracts. ZK scaling solutions have been created by Astar to increase the scalability of the network.

Based on a dynamic rewards model, Astar allocates staking rewards to application developers. Developers will eventually receive 50% of Astar’s staking rewards.

Acala and Astar will work together to develop several new cross-chain use cases and aUSD liquidity pools in the Astar ecosystem. Our long-term price target for ASTR is $6.3.

Moonbeam (GLMR)

Moonbeam is a cross-chain smart contract platform that is EVM-compatible. The XC-20 token class, which Moonbeam introduced, is a new token class that offers the native interoperability of Substrate-based assets while letting users and developers communicate using the well-known ERC-20 tokens.

LayerZero and Moonbeam recently integrated. Without being limited by solo chain development, Moonbeam developers can create the next generation of applications using LayerZero’s messaging standard.

Astar and Moonbeam recently integrated, enabling Astar’s ASTR token throughout the Moonbeam DApp ecosystem as xcASTR deposited on Moonbeam.

Our long-term price target for GLMR is $230.

Parallel Finance (PARA)

The DeFi platform Parallel Finance has a lot of features. Numerous financial services are available, including a DEX, lending and borrowing, an NFT marketplace, a DAO, liquid staking, and cross-chain bridging. Parallel integrates leverage staking, which allows users to lend and stake simultaneously, thus earning double yield.

These use cases can all expand the multi-chain universe and drive liquidity in the ecosystem. Our long-term price target for PARA is $0.7.

Cosmos Ecosystem

Osmosis (OSMO)

Osmosis is a decentralized exchange (DEX) supported Inter-Blockchain Communication (IBC) protocol in the Cosmos ecosystem. Users can start liquidity pools with features like multi-weighted asset pools and bonding curves. In the Cosmos ecosystem, Osmosis has the most IBC transfers.

The Osmosis automated market maker (AMM) affords users the ability to create new and unique liquidity pools that are controlled and voted on by governance participants.

Users can send ERC-20 tokens from Ethereum to Osmosis via the Althea gravity bridge – a trustless bridge. Because Osmosis is built on the Cosmos ecosystem, users are able to natively trade assets from more than 47 different chains within Cosmos.

Osmosis introduces superfluid staking. OSMO can be used simultaneously to stake and provide liquidity – a feature that makes OSMO unique.

Similar to Bitcoin’s halving, which reduces token issuance by half every four years, Osmosis will reduce token issuance by one-third annually. The initial distribution of OSMO provides users with a strong incentive through:

  • 25% staking rewards.
  • 45% Liquidity Mining program. LPs can bond their LP tokens to receive liquidity mining rewards.

Our long-term price target for OSMO is $15.

Target MCap: $12 billion.

Cronos (CRO)

Cronos is an EVM-compatible blockchain that supports the Ethereum and Cosmos ecosystems. Crypto.com, one of the largest exchanges in the world, supports Cronos. Ethermint, the technology that powers Cronos, enables quick dApp and smart contract porting from Ethereum chains. Cronos is connected to the IBC.

The mainnet for Cronos Chain launched in November 2021. TVL growth has exploded despite the recent launch. The Cosmos ecosystem’s highest TVL belongs to Cronos. The $100 million CRO EVM fund, which provides incentives for developers to build on Cronos, may be partially responsible for this.

There are at least 120 dApps built on Cronos and at least 3,500 different CRC-20 tokens minted.

The Cronos gravity bridge is anticipated to connect Ethereum and Cosmos soon.

Cronos has its own NFT marketplace where users use CRO to make NFT purchases. The NFT marketplace created billions worth of demand for CRO in recent months.

Increasing cashback, growing interest in staking on Crypto Earn, and purchase rebates on Expedia, Airbnb, Spotify, Netflix, and Amazon Prime are additional incentives to stake and hold the CRO token.

Staking CRO can also result in lower trading fees. The discount rate increment rises as the stake increases, but they are not always linear.

Our long-term price target for CRO is $1.

Target MCap: $30 billion.

Final Words

Inevitably, crypto will soon reach a multi-trillion valuation. These L1s should occupy a sizable portion of the market. These Layer 1s should be the base infrastructure for Web3 to allow decentralized apps to thrive.

We will start this report by examining the assets and finish with price predictions. Let’s dive in!

Note:

Things you need to know while reading:

Appchain: a blockchain that is exclusively designed to operate one specific application instead of multiple apps as a public blockchain is designed to do.

Appchains operate on top of existing blockchains in order to take advantage of their security and gas fees. Blockchains that use appchains: Polkadot Parachains, Cosmos Zones and Avalanche Subnets.

Long-term: We have a minimum 2-year time frame and a maximum 4-year time frame for our goals. Price targets are determined by yearly changes in new supply, market capitalization (MCap), positive development outcomes, and favorable macroeconomic conditions – peak bull run.

Perspective of Selection

These L1s are our top picks because:

  1. Layer 1s have been battle-tested and have established themselves as essential to DeFi.
  2. Layer 1s who could be competitive in this sector. We anticipate strong performance from them in the upcoming bull run.

Since this is our first research report about Near Protocol, Osmosis, and Cronos, we have covered them more extensively than the others.

Ethereum (ETH)

On September 15th, The Merge, Ethereum’s most anticipated upgrade, will launch, radically altering its consensus mechanism (security) and tokenomics (token model). Our long-term target for ETH is $10,000 due to the Merge catalyst and Danksharding (improving Ethereum’s scalability upgrade) in 2023.

Target MCap at least $1 trillion.

Solana (SOL)

Ethereum is the king of DeFi, but Solana has proven to be the king of blue-chip NFTs. Solana started the year with congestion issues which slowed down the network. However, Solana has accomplished more than most L1s in just over a year. The upcoming fee market is implemented similarly to Ethereum, with users paying a premium to have their transactions (TXs) processed more quickly. Because of this, SOL will accrue more value and generate more revenue.

Additionally, Jump Crypto (a prominent Web3 infrastructure developer) and Solana are working together to create a separate second validator client in the C++ programming language. This action is crucial to enhancing the network’s decentralization and performance.

Our long-term target for SOL is $400

Target MCap: $200 billion, assuming all total supply is in circulation (508,180,963).

BNB Chain (BNB)

The fact that Binance, the largest cryptocurrency exchange in the world, is backing BNB Chain justifies its inclusion on this list even though it is not the strongest L1 available. Following Ethereum, BNB Chain generates the most revenue and DeFi liquidity. BNB has been one of the top 5 cryptocurrencies by market cap for at least a year.

Our long-term price target for BNB is $1000.

Target MCap: $250 billion. Only 2% inflation left. FDV will soon = current MCap.

Cosmos Hub (ATOM)

Cosmos (Layer 0) is an ecosystem of interconnected L1 blockchains. These L1s built on top of it connect using IBC, the Inter-Blockchain Communication protocol and share messages. The Cosmos Hub (Layer 1) is the first of thousands of interconnected blockchains that comprise the Cosmos Network. The primary token of the Cosmos Hub is ATOM.

The ATOM token does not accrue great value because its primarily used for governance. ATOM is not used to pay for TXs. The Cosmos Hub has proved vital in the IBC ecosystem and will always have hype regardless of its poor tokenomics.

Our long-term price target for ATOM is $55.

Target MCap: $25 billion.

Near Protocol (NEAR)

In October 2021, Near Protocol unveiled an $800 million ecosystem fund, and ever since, Near has experienced significant growth. Near Protocol claims to be scalable through the use of Nightshade, a sharding technology.

Near achieves EVM-compatibility with Ethereum in a unique way via Aurora, Near’s scaling solution. Ethereum developers can easily write solidity smart contracts and deploy existing dApps to Near through Aurora.

A smart contract’s creator receives 30% of the TX fees on Near. This mechanism encourages developers to build on the network because they can develop a dApp that will generate income for them in the future.

On Near, developers can choose to write smart contracts using JavaScript or Rust, making it easier for Web2 developers to create dApps rather than learning a specific language like Solidity.

The Octopus Network (OCT) is a multichain, interoperable network for launching application-specific blockchains, aka appchains on Near.

Octopus appchains are fully interoperable with Near. OCT tokens can be used as collateral for cross-chain assets between appchains and Near.

Our long-term price target for NEAR is $40.

Target MCap: $40 billion. The entire supply will be fully unlocked in October.

Mina Protocol

Mina Protocol is a 22-kb blockchain that enables anyone to participate in network security through a smartphone. Mina Protocol leverages ZK-SNARKs tech to allow use cases between the real world and Web3.

Off-chain verification and private scalable dApps are features that will enable Mina to assist the crypto industry. Mina is still under development, which accounts for its lack of traction.

The most anticipated event on Mina’s roadmap is zkApps, zero knowledge apps. ZkApps should go live in Q3-Q4. Mina Protocol is covered fully here.

Our long-term price target for Mina is $100.

Polkadot Ecosystem

Acala (ACA)

Acala is a Polkadot-based DeFi network that supports the Acala Dollar (aUSD) ecosystem and is EVM-compatible. Acala makes use of the Homa protocol to support liquid staking. Users stake their tokens, and in exchange, they are given L-Tokens (such as LDOT), which represent the principal asset and the continuously accruing staking yield.

Liquidity from various chains and token standards can be used for a range of DeFi activities on Acala. Acala is fully covered here.

Acala Dollar got exploited in August, and the chain is in maintenance mode until further notice. More on this incident can be found here.

Our long-term price target for ACA is $6.5.

Target MCap: $2 billion.

Astar (ASTR)

Astar Network either using WASM/rust or EVM/solidity offers developers various ways to write smart contracts. ZK scaling solutions have been created by Astar to increase the scalability of the network.

Based on a dynamic rewards model, Astar allocates staking rewards to application developers. Developers will eventually receive 50% of Astar’s staking rewards.

Acala and Astar will work together to develop several new cross-chain use cases and aUSD liquidity pools in the Astar ecosystem. Astar is covered fully here. Our long-term price target for ASTR is $6.3.

Moonbeam (GLMR)

Moonbeam is a cross-chain smart contract platform that is EVM-compatible. The XC-20 token class, which Moonbeam introduced, is a new token class that offers the native interoperability of Substrate-based assets while letting users and developers communicate using the well-known ERC-20 tokens.

LayerZero and Moonbeam recently integrated. Without being limited by solo chain development, Moonbeam developers can create the next generation of applications using LayerZero’s messaging standard.

Astar and Moonbeam recently integrated, enabling Astar’s ASTR token throughout the Moonbeam DApp ecosystem as xcASTR deposited on Moonbeam.

Moonbeam is covered fully here.

Our long-term price target for GLMR is $230.

Parallel Finance (PARA)

The DeFi platform Parallel Finance has a lot of features. Numerous financial services are available, including a DEX, lending and borrowing, an NFT marketplace, a DAO, liquid staking, and cross-chain bridging. Parallel integrates leverage staking, which allows users to lend and stake simultaneously, thus earning double yield.

These use cases can all expand the multi-chain universe and drive liquidity in the ecosystem. More on Parallel Finance here. Our long-term price target for PARA is $0.7.

Cosmos Ecosystem

Osmosis (OSMO)

Osmosis is a decentralized exchange (DEX) supported Inter-Blockchain Communication (IBC) protocol in the Cosmos ecosystem. Users can start liquidity pools with features like multi-weighted asset pools and bonding curves. In the Cosmos ecosystem, Osmosis has the most IBC transfers.

The Osmosis automated market maker (AMM) affords users the ability to create new and unique liquidity pools that are controlled and voted on by governance participants.

Users can send ERC-20 tokens from Ethereum to Osmosis via the Althea gravity bridge – a trustless bridge. Because Osmosis is built on the Cosmos ecosystem, users are able to natively trade assets from more than 47 different chains within Cosmos.

Osmosis introduces superfluid staking. OSMO can be used simultaneously to stake and provide liquidity – a feature that makes OSMO unique.

Similar to Bitcoin’s halving, which reduces token issuance by half every four years, Osmosis will reduce token issuance by one-third annually. The initial distribution of OSMO provides users with a strong incentive through:

  • 25% staking rewards.
  • 45% Liquidity Mining program. LPs can bond their LP tokens to receive liquidity mining rewards.

Our long-term price target for OSMO is $15.

Target MCap: $12 billion.

Cronos (CRO)

Cronos is an EVM-compatible blockchain that supports the Ethereum and Cosmos ecosystems. Crypto.com, one of the largest exchanges in the world, supports Cronos. Ethermint, the technology that powers Cronos, enables quick dApp and smart contract porting from Ethereum chains. Cronos is connected to the IBC.

The mainnet for Cronos Chain launched in November 2021. TVL growth has exploded despite the recent launch. The Cosmos ecosystem’s highest TVL belongs to Cronos. The $100 million CRO EVM fund, which provides incentives for developers to build on Cronos, may be partially responsible for this.

There are at least 120 dApps built on Cronos and at least 3,500 different CRC-20 tokens minted.

The Cronos gravity bridge is anticipated to connect Ethereum and Cosmos soon.

Cronos has its own NFT marketplace where users use CRO to make NFT purchases. The NFT marketplace created billions worth of demand for CRO in recent months.

Increasing cashback, growing interest in staking on Crypto Earn, and purchase rebates on Expedia, Airbnb, Spotify, Netflix, and Amazon Prime are additional incentives to stake and hold the CRO token.

Staking CRO can also result in lower trading fees. The discount rate increment rises as the stake increases, but they are not always linear.

Our long-term price target for CRO is $1.

Target MCap: $30 billion.

Final Words

Inevitably, crypto will soon reach a multi-trillion valuation. These L1s should occupy a sizable portion of the market. These Layer 1s should be the base infrastructure for Web3 to allow decentralized apps to thrive.