Bitcoin and Ethereum are the two popular cryptocurrency options for the majority of investors. Therefore both have a long track record, are most valuable, and show future potential. There are hundreds of cryptocurrency options in the market, but the less popular the higher the risk to expect from your investment. There is the price and some key metrics to consider while making smart investment decisions.
Consider quantitative factors like market cap, price, and trading volume along with qualitative aspects like use cases, digital coin creators, what’s in the white paper, and more. Just buying a crypto coin because you heard it is good with the hope it will bring in a huge amount soon is not the right way to invest.
When you invest in cryptocurrency, gain proper knowledge because you are taking a massive risk. Gain education on ZenGo X and even learn how the Dogecoin wallet works.
Pointers in how to identify the correct crypto-investment
The community
Choose cryptocurrencies with loyal followers and strong community supporters. It reveals that people have real interest and faith in cryptocurrency. Popular cryptocurrencies have large groups but even small communities are active and helpful.
Fundamental analysis
Under fundamental analysis consider their team, strengths, ambitions, and more. Many investors are new and chase low-quality crypto coins. Learning how to perform fundamental analysis help them to separate the good from the low-quality ones.
- The team – Research the cryptocurrency team and vet them. Look for answers to questions like do you believe in the team behind the cryptocurrency, are they ambitious and does the team have a successful track record?
- The technology – Understand how the potential cryptocurrency performs against other cryptos. How beneficial is the technology? For example, Ethereum has proven to have the best technology including Smart Contracts and Ethereum Virtual Machine.
- The white paper – When a new cryptocurrency gets released, it introduces a white paper. The white paper defines the coin’s purpose, technology, mechanism, and overall vision. It is the best feature to evaluate the coin’s fundamentals. Therefore read the white paper before investing.
- Their vision – Cryptocurrency needs to have a vision. It ensures whether the coin will stay around for a decade or less. If you are choosing a short-term approach then you need to be concerned. Without a clear mission and vision, the coin struggles to become the industry’s disruptor and competitor. Invest in cryptocurrency with a solid vision. It goes a long way to pay off over time.
- Their leadership – Leadership is crucial for crypto coin’s success. Leaders make huge decisions, so check what they have attained until now. If they are champions with a vision then the coin will attain success.
- Pricing history – Price fluctuations reveal the coin’s strong history to detect if the investment is solid for the future or not. Ask questions like is it volatile, is the coin resilient to frequent big dips, are they valued at an all-time high, and more. Forecasting price movement is hard, so without any fear predict the future. Just stick to fundamentals.
- Reputation – Never invest money in cryptocurrency with a bad reputation. Therefore perform some online research, check crypto communities’ discussions, and more. Invest in crypto that makes you feel positive.
Unlike USDT, the price of Ethereum and Bitcoin are expected to fluctuate every day. Stable coins allow stability instead of price gains.