Five (5) important things to consider, when choosing a cryptocurrncy for investment.
Here are tips that will save you money and time.
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There are many factors to consider when choosing a cryptocurrency investment, but for many investors, things like price, and accessibility to the coin are most impornat.
Exactly in that order first question is usually :-
•Whats the price of the coin?
•How can I get the coin?
Though they are valid questions but they exclude some other important considerations.
These considerations could save you time and money right off the bat.
1/ Market capitalisation
Ranking cryptocurrencies based on market capitalisation is one way of selecting them for investment.
What is market capitalisation (market cap) and why does it matter?
•Market cap is used as an indicator that measures and keeps track of the market value of a cryptocurrency.
You can keep track with information about crypto, on coinmarketcap. Com
2/ Total coins to be mined and current supply.
Look at whether there is going to be a limited supply of a particular cryptocurrency.
You should also consider the number of coins that are already in circulation.
For example, Bitcoin’s overall supply is limited to mining 21 million coins only.
As of September 2022, is 19,161,00 million coins are available, with a limited number of coins to be mined.
The demand for Bitcoin is increasing with every passing day as more and more people are investing in it. But supply is limited.
The increase in demand and limited supply leads to an increase in the price of any digital asset, and the same applies to Bitcoin also.
In deciding which crypto to buy for investment, you should check what will be the overall supply and how much of it is already in circulation.
3/ Utility
One of the important things mentioned in the white paper is the coin's use cases.
It is one of the main factors that will drive acceptance among its users/investors.
Over time, new use cases may get developed.
The more the number of use cases, the wider the coin's acceptance will be, and the more the increase in its value.
Let’s consider an example. Technology-wise, Ethereum currently has one of the best use cases.
Ethereum has the second biggest market capitalisation after Bitcoin, because of the number of projects built on it.
It's provides utility to many aspects and other projects in the crypto space.
It might be one of the best cryptos to buy now.
If the coin’s use cases go down, the probability of the coin’s value going down and the coin not surviving will be higher.
You may may want to consider the coin’s use cases as a key factor while deciding on the best cryptocurrency to buy.
4/ The Community.
A big part of a cryptocurrency’s success is it’s following – so look out for cryptocurrencies with strong communities and loyal followers.
Having a strong community shows people have a genuine interest and belief in the crypto
currency.
Crypto is twitter.
This is because the Keeping up with cryptotwitter can help you stay informed of the latest news, conversations and controversies that matter in the world of cryptocurrency.
The crypto community on Twitter is a constantly evolving repository of questions, answers, explanations and speculations from every corner of the crypto community.
Twitter is one of the key platforms where ideas get exchanged: people and projects announce milestones in their progress, issue reassurances when things go wrong and share their personal thoughts.
5/ The Team.
One of the top things you can research is the cryptocurrency’s team.
In fact, researching and vetting the team behind a cryptocurrency is one of the most important factors you can look into.
Here’s a few things to analyse:
• Who is behind the cryptocurrency?
• Do you trust in their expertise?
• Are they ambitious?
• Do they have a proven track record of success?
These are all important questions when you’re deciding which cryptocurrency to invest in.
The team steers the project to it's success or failure.
These are five (considerations) that will save you money and time.
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@2xnmore
Demystifying DeFi & Web3—insights, analysis, and strategies for the future of crypto.