Hi Cryptorians
We met again, and I really appreciated the time that you were willing to spend reading through the article that I wrote. In this article, I would like to show you how you can analyse new altcoins on the market.
First, what are altcoins? Altcoins are an alternative coin to Bitcoin (BTC); all other 22,000 coins available on the market today are altcoins. Then, why do we need to analyse altcoins? Since BTC had been on mass market adoptions as well as already experiencing exponential growth, we couldn’t expect more godly growth from BTC. Even the growth of BTC nowadays is still considered better than most financial instruments, but taking into account 10x, 50x, 100x, or even 1000x coins, we need to consider other coins.
Here are the ten (10) steps to be analysed:
1. The coin has a solid use case. Any coins that we want to invest in for the long term must have a solid use case; never ever invest in any sh*t coins that are highly likely to get you into a rugpull.
2. Check the official website. This is among the first things to see. Check the website; if the website has childish makeup, many typos, and is a copycat of another reputable project, please run away.
3. Check on the founder and partner. They are the drivers of the company; they will need to steer it in the right direction. Conduct checks on them and ensure they are a reputable team that always strives for excellence in their projects.
4. Read on whitepaper. The whitepaper is the baseline of the company’s what, when, who, why, and how (5W 1H) and looks at details of the direction the company is going, whether it is in the blue ocean or red ocean market. Any hiccup on whitepaper can be easily traced by nonsense writing and a lack of a clear pathway.
5. Check on the founder and partner. They are the drivers of the company; they will need to steer it in the right direction. Conduct checks on them and ensure they are a reputable team that always strives for excellence in their projects.
6. Check with any funder or venture capitalist involved in the project. Of course, use other people’s expertise as well, especially big VCs like Blockchain Capital, Panthera Digital, and Binance Labs; they already do the screening for us, and if any project is listed among their projects, it is highly likely the project will be successful.
7. The project is listed on many exchanges, or at least one reputable one. To be listed on exchanges, any project needs to pass strict criteria, especially for big exchanges like Binance and Coinbase; thus, being listed shows they have already passed some level of auditing.
8. Check social media, especially Twitter. In the active social media of the project, please raise a big red flag. The minimum number I would suggest for any altcoin project is at least 50,000 followers on Twitter; if lower than that, it is very risky.
9. More than USD 1 million in trading volume. The trading volume represents the project being transacted in either buying or selling mode; a high trading volume means the project is easily liquidated (can be sold).
10. More than USD 10 million in market capital. Cryptocurrencies are ranked in Coinmarketcap and Coingecko generally based on market capitalization. Higher market capital will make the project less volatile, and many people are on board. Lower market capital means we are able to see more growth in the project. As the current market capital of Ethereum (ETH) is USD 230 billion, could you imagine how big a project with USD 10 million could be if it had the same market capital as ETH in the future? It would be a godly increase of 23,000%.
Alright, that’s all for today. Please be careful when selecting any project and use Coinmarketcap and Coingecko wisely. One extra way, I would say the project would lie between 100 and 500 ranks in the Coinmarketcap or Coingecko. Not below and, of course, not above it.
