How to Spot the Next Big Crypto if you’ve Missed the Bitcoin Train? – When Bitcoin was launched on the market, there weren’t any obvious signs indicating the massive potential of the project or how it would evolve in the years to come. After all, Bitcoin was the very first digital currency to be made available to the public, and no one really knew what to make of this new asset class. Therefore, most kept their distance, and only a handful of people had the inspiration to jump onboard and purchase Bitcoin in its early days. Those people became millionaires in a relatively short span of time, earning huge returns when Bitcoin prices started to soar.
When the rest of the world realized just how big Bitcoin had gotten, a lot of people regrated not having invested in it when the time was right. Bitcoin price today has reached values that no one could have predicted in the beginning. And although Bitcoin continues to perform well and remains one of the most appealing crypto options for investors, it’s unlikely the astounding price surge from the last years will ever repeat itself.
Therefore, crypto enthusiasts are now on the lookout for the next big digital currencies that might replicate Bitcoin’s success and make them rich overnight. The good news is there are hundreds of promising crypto projects out there, so there’s a possibility at least one of them will take off. The bad news is that with all the competition in the market, it’s extremely difficult to separate the wheat from the chaff and figure out which crypto has the biggest chance of success.
So, if you want to scour the crypto sphere in search of potentially winning projects to support, here are some of the factors you should keep your eyes on.
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Price
Price is definitely the main aspect you should focus on when looking to invest in crypto. A lot of investors put their money on already established cryptocurrencies since they tend to be more stable and have already proven their value in time. However, the chances of making big money by investing in expensive cryptos that have plateaued are quite low. It’s also not an ideal option if you don’t dispose of a big investment budget.
The best method is to invest in several low-cost digital assets that have plenty of room to grow in the future. Joining a project early on when they’re still in the initial development stages will help you keep risks within reasonable limits while also increasing your chances of making high returns as the cryptos evolve.
The team behind the project
Bringing a new cryptocurrency into existence is definitely not for the faint of heart. It requires deep knowledge, skills, commitment, enthusiasm, patience and massive amounts of work. If you’re going to put your money into supporting a young project, you’ll want to know who is building it and figure out if they have what it takes to see things through.
Given that a crypto initiative is only as strong as the people working to develop it, you need to pull off the curtain and find out who are the creative minds behind the project. What is their background and experience, what other projects have they worked on and what do they hope to achieve with the project they’re currently developing? These are the questions you should ask when vetting cryptos.
It’s also a good idea to look at how much time and effort they’re putting into advancing the project by checking the level of activity (that includes updates, developmental stages, engagement on the platform, rating, etc.). Teams that are actively involved in growing a project are always a good omen.
Adoption prospects
With so many new cryptocurrencies emerging on the market, it’s obvious only the ones that bring something innovative and useful have real chances to stand out from the crowd and enjoy large-scale adoption. And if they manage to gain the attention of a large enough number of people, it’s much more likely their value will increase over time.
That’s what happened with Ethereum, whose use cases go far beyond the transfer of digital assets, expanding on the front of smart contracts and decentralized finance (DeFi). The fact that the Ethereum network allows for a wide array of applications has ensured its competitive edge, and thus the interest in their native currency, Ether, has also surged considerably. Similarly, other crypto initiatives that provide new features and use cases stand better chances of making it into the limelight.
Supply and demand
As with all other assets, crypto prices are dependent on the supply and demand dynamics. Some cryptocurrencies have a fixed supply limit (Bitcoin’s max cap is set at 21 million), while others, like Ethereum or Dogecoin, have unlimited supplies. Cryptos use different mechanisms and mining protocols to determine how new coins enter circulation in order to ensure scarcity and maintain an equilibrium between supply and demand that can ensure price stability.
It’s therefore extremely important to learn about supply limits, the number of coins in circulation and how new coins are being minted. Based on these factors, you can make an assessment of the project’s potential and decide if it’s worth investing in or not.
Trading volume
Another effective way to spot potential winners is to look at their trading volume. When a crypto is highly active on exchange platforms, being bought and sold by a large number of people, it usually means it has attracted a lot of attention from traders, and that’s a sign it might pick up pace in the near future. Although trading volume doesn’t necessarily guarantee a successful development, it’s definitely worth keeping an eye on this metric if you want to spot promising crypto projects early on.
It would be great to have a crystally ball that could help you see into the future and figure out which crypto might take off and which might go under, so that you don’t waste your time and money supporting lost causes. But since you can’t rely on magic, the next best thing is to take all the factors listed above into consideration and use your better judgment to make smart investing decisions.
