Staying Vigilant: Identifying the Cryptos With the Least Worthiness

(Image from Pexels) 
The crypto market continues to attract both seasoned investors and ordinary people. As of September 2023, about 23,000 cryptocurrencies are in circulation. This is quite different from the situation ten years back when just less than ten coins existed. Bitcoin became the pioneer digital currency and it still holds the largest share of the crypto market.

But, is every cryptocurrency worth an investment? Both seasoned and upcoming investors need to ask this question before investing in any digital coin. Crypto market analysts and financial experts know that many of the existing cryptocurrencies don’t have a promising future. Consequently, crypto investors and enthusiasts should know which coins are worth their time and money. 

The crypto space's rapid growth is undoubtedly a positive development, but investors must exercise vigilance. That is why this post will identify some of the most important things to look for in a crypto coin before investing. 

How to Evaluate a Cryptocurrency’s Worthiness

Cryptocurrency investing can be profitable, even much better than the traditional stock markets. But one needs to know the game first. Besides knowing the basics of investing, investors should know a few things about different cryptocurrencies. Here are the things crypto investors should know before investing in any cryptocurrency:

Purpose of the Cryptocurrency

Many cryptocurrencies out there have no clear purpose. What are the core features of a crypto project that separate it from other coins on the market? Investors should acquaint themselves with their preferred coins by identifying their actual use case.

To illustrate, when Bitcoin was first formed, other creators also came up with clones, which were just copycats. Those projects no longer exist today but their creators made money anyway. Those who invested in such projects never gained anything. Generic use cases are less likely to succeed. Investors should stay clear of such projects. 

The use case must be logical. Investors can get clear information from the project’s whitepaper. If it’s just another ‘decentralized’ project, it’s a red flag.

The Crypto Coin Must Have Competent, Reputable, and Transparent Development

The first thing to check when looking for a cryptocurrency to invest in is its website. On the website, one should look at the developer or team page. For transparency, the developers and team members should have their real names displayed, their images, pictures, and credentials. Where these are missing, it’s a red flag that investors should avoid by all means.

Clarity of sites is important, even in leisure play. When you're using cryptocurrency to fund your gambling account to play casino games, always ensure the online casino accepts crypto. Many online casinos accept this currency, but if you want to play Reactoonz, you’ll have to save your crypto for a different purchase. Regardless, using reputable currencies ensures a smooth and safe transaction with online gambling or any purchase with crypto.

Genuine crypto projects have no problem putting their real names and images on the whitepaper or company website. Investors can also reverse search the images on Google to see if they are real. If they’re found to be fake, the project is a red flag. Project developers and team members should also have their information on social media platforms such as LinkedIn. 

How Detailed is the White Paper?

A crypto white paper is a critical tool for gauging the value of any existing or upcoming crypto project. It’s the foundation of the project’s proposal, which the developers and team members use to communicate their intentions. The powerful document outlines the goals and strategies for the cryptocurrency’s usage. 

Besides, a white paper gives a clear road map for the upcoming cryptocurrency or token. Most investors will read the whitepaper first before they invest in the project. This implies that crypto projects with unclear road maps have no value. A good whitepaper should have no spelling or grammatical errors. It must also include the tokenomics of the coin. 

Is Cryptocurrency Accepted at Online Casinos?

Many online casinos today accept cryptocurrencies for payments and withdrawals. This has made it easier for players to explore more ways to venture into online gaming. To gauge whether a cryptocurrency holds some worthiness, investors can also check whether it’s accepted on any reliable casino platform, such as Betsafe. 

Crypto coins that aren’t accepted on any reliable gaming platform are a red flag. They could be just another crypto scam on the internet.  Alternatively, investors should do a random search on social media for any mentions and discussions around their preferred cryptocurrencies. If the coin enjoys positive discussions and comments from many people, it could be a worthy investment.

Market Metrics of the Cryptocurrency

Investors can find a cryptocurrency’s market metrics on reliable aggregation websites. Examples include CoinMarketCap, CoinGecko, CryptoCompare, CoinDesk, and others. Here are the main things to check out:

1. Market capitalization

A cryptocurrency’s market cap refers to the overall market share of the coin. It’s the product of the price of a cryptocurrency multiplied by the number of tokens or coins in circulation. Investors are advised to go for cryptos with higher market caps—say, more than one billion dollars. All the same, investors still need to exercise caution because some cryptocurrencies have higher market caps, but they’re still high-risk investments. 

Some newer projects have good potential for growth and better partnerships. They may just need more time and exposure to catch up. Overall, cryptocurrencies in the top 100 are considered safer for investments than their peers on the lower side.

1. Trading Volume

Trading volume is a critical indicator of a coin’s worthiness. It refers to the amount of a cryptocurrency that has been traded within a given period, usually 24 hours. Cryptocurrencies with high trading volumes show that investors are attracted to them, which facilitates regular buying and selling. 

Eventually, it leads to more liquidity and price stability. A low trading volume, on the other hand, shows low investor interest. This can lead to serious price drops and poor liquidity. 

1. Supply Metrics

Max supply refers to the maximum number of coins that will ever exist for a given crypto. Most cryptocurrencies have this metric. Some have an unlimited supply. For example, consider Ethereum. Others have coin limits, even if they're in hundreds of billions. The circulating supply is a reflection of the number of coins currently being traded or held in crypto wallets. 

Investors can use this metric to determine the potential scarcity of a cryptocurrency. This can affect the coin’s price in both directions. Knowing how all three metrics work can help investors make informed financial decisions.

Does the Coin Have Utility?

Some cryptocurrencies may not have practical use cases, but they can still have utility in the blockchain community. Such coins aim to solve certain issues within the network, or they can improve the functionality of the network. A good example is Ethereum, which supports the development of other smart contracts, businesses, and NFT projects.

Cryptocurrencies with utility can retain their value over time. Other cryptocurrencies, such as Bitcoin and Cardano, are decentralized and can be used for payments and as a repository of value. Overall, investors should look at the utility side of a cryptocurrency before investing in it.