These are super important steps even for someone who has a loads of experiences . I have tried a lot of methods to find good coins (obviously my intention was to get monetary benefits ) , literally i did. After loosing 50% of my portfolio i realised i was doing something wrong and i had to correct my wrongdoings .
Talking with lot of new crypto guys , i realised there is a pattern of mistakes among all newbie (doesnt matter how smart you are ). Crypto is a completely new idea and your experience in all other areas dont fit in here(irony).
So here is my 5 steps approach to find a good coin:
- Team: This is super point . Meaning if you find a weak team developing a crypto project dont even look at it . We are at very early stages of blockchain era and nobody knows how the world would be 5 years down . Great minds , great people will evolve and adapt the best . Check the background , experiences , collaborations of the team and most likely you will be able to find a notion .(On the side note , please avoid chasing the whitepaper which in most cases are not even explanatory and usually written by experts )
2.Governance: Specially newbie miss this point as they are so much focused to make 10x their money . In my experience i have seen many blockchain projects which has a centralised control point . Centralised governance comes with extreme risks of manipulation while it speeds the development in some cases . I cant call it a good or bad idea since in some cases partial centralised approach has been proven more effective . But definitely look for a governance model attached to the project. I guess the projects that tells upfront the truth and explain their stands are the ones who will use a good governance system .
3.Usability: Ask the question : Is the coin solving a real world problem ?Most coins will try to cover the weaknesses of bitcoins, ethereum and try to sale you on this. This wont last . Eventually ETH and BTC will have their weaknesses sorted out themselves . Solving a BTC or ETH problem is not a use case in the long run . I usually look for innovation beyond that and solution to real world problems(Like cutting of the middleman from real estate , identity verification etc).
4.Liquidity : Before you look into the price of a coin , look into its trade volume and listings on exchange. Usually a good coin would have at least 10 exchnages listing and good daily trade volume (Use coinmarketcap.com to get the daily data). Avoid the coins which have trading volume concentrated in one exchanger.
5.Communication/PR : This is tricky part and most newbie pick the wrong side due to marketing communication and PR. Some coins create a lot of hype while they have no fundamental value . Others tend to focus development more than spend time on social media hype. You need to carefully dissect the information on social media . Usually the big things happen before the social media gets aware of it.
Follow experienced people in all steps and only put the money you can afford to loose.
Good luck .
as always extraordinary ... thumbs up 👍 to your effort for teaching us..
Thanks bro
thanks for your information
Great informations for the newbies.
Excellent procedure to find out good coins. Thanks for sharing your valuable idea which help me as a new. We always love your very honest review of your crypto journey.
Thnx for helpfull info.
Helpful for me.Thanks for this valuable post.
Its really usefull for not all crypto people. Thanks
Thanks for your nice article.
Write more articles for us, defiantly is helpful for all not only for newbies. I will be happy if you will write something on money management for trading (Bear & Bull) . I am waiting for the next article
thank you for your information
Very precise and effective writing. It would be better if you prolonged it in some extend for newbies. Coinmarketcap.com is a blessing for crypto investors, so please write on various aspects of Coinmarketcap.com if possible. TIA.
nice information