How to Recognize the Next Big Cryptocurrency

The 2017’s huge spike in Bitcoin value is well behind us now, and if you haven’t gotten rich back then, you’re probably looking for the next big trend. Well, you aren’t the only one, and things are now definitely more complicated – the majority of investors are starting to focus on other cryptocurrencies on the market, trying their best to spot the next big hit.

Unfortunately, there is no real way of telling which crypto is going to be the successor to the Bitcoin, which has made things significantly more difficult – before the 2017’s spike, it was either Bitcoin or nothing, essentially. The best thing one can do is to try and identify the digital currencies with the highest chances of taking over the market.

The factor of price

Unlike your regular currencies, the cryptos are based on decentralization and high volatility. We’ll address the subject of decentralization further in the text, so let’s take on the high volatility aspect of cryptocurrencies. Essentially, the high volatility of digital currencies says that a single token can spike or drop a lot in a matter of days. This is no speculation – Bitcoin is the living proof here: despite the seemingly unstoppable growth that had been going on for months before the New Year, since then there’s been a plummet from mind-boggling $19,000 to $10,000.

The best way to go about this is to keep track of other available cryptos on the market; in fact, low-value coins that are priced less than a dollar are usually the safest! Investing in a number of digital currencies at the same time helps curb the effect of their huge volatility and diversifies your portfolio. In this way, you can easily add to your investment in case of a sudden spike onset, and in case of a crash, you won’t end up with empty pockets.

The coin supply factor

Contrary to the popular opinion, price isn’t the only thing that comprises a digital currency’s value – the coin supply is an equally vital factor. Taking Bitcoin as an example is the best way to explain the coin supply. There are 21 million Bitcoins out there that are obtainable, and 16.8 million have already been mined, meaning that there is only 20% of bitcoins left on the market. Unless the market experiences a complete crash, the last Bitcoin is bound to be obtained, at which point there will be no Bitcoin left. This is the relevance of the coin supply, in a nutshell.

Using the coin supply knowledge to your benefit is simple to explain, although it does take time: you should follow the spikes in coin value and refer to each respective coin’s coin supply in order to determine whether it’s a worthy investment. At the moment the supply of the coin in question starts approaching the limit, the demand is bound to increase, and the same goes for its price.

Keeping an eye on original cryptocurrencies

The blockchain technology the cryptocurrencies are based on actually has a wide span of other applications that aren’t necessarily related to the digital currency market. As a matter of fact, the very essence of this unique technology is finding unique and innovative ways for a cryptocurrencty to be based on. Yet again, this is best explained through Bitcoin: with the idea of introducing a decentralized public ledger (a unique currency that isn’t regulated by any bank or government), Bitcoin was introduced to the market. This has helped abolish the transaction approval periods and additional fees, which is exactly why the world’s most popular cryptocurrency has achieved success.

This is why investing in cryptocurrencies that are based on roughly the same principle as Bitcoin isn’t really smart; for obvious reasons, these currencies have a tendency of being uninteresting, which makes them becoming a trend highly unlikely. You should keep an eye on the latest crypto trends via trusted and useful sources like Blockchain Review and take note of whatever interesting currency comes up.

Researching ICO

ICO (initial coin offering) is often an excellent testimonial of legitimacy and potential of a coin-to-be. It’s essentially a call out to micro- and large-scale investors to put stakes into something that will grow into a real currency. At the risk of oversimplifying things, ICO is basically crowdfunding for cryptocurrencies.

Unfortunately, there are a lot of scammers and frauds out there who actively come up with ICOs in order to lure the investors into placing their bets on something that has been made with crashing and burning in mind. Owing to the fact that there are so many inexperienced micro-investors out there, this strategy often ends up being successful for the fraudulent types.

Seeing as how both the legitimate ICOs and the frauds tend to place nothing but a whitepaper out there, you should learn how to spot the fakes. Check each ICO’s website and look for details; the scammers usually don’t bother with aesthetics. Google the team members, look them up on LinkedIn, and even on Facebook, Instagram and Twitter to check for legitimacy.

The price and coin supply factors should typically tell you which cryptocurrency will grow. However, if you want to spot the next Bitcoin, you need to get into details and dedicate your time towards finding original ideas with proper ICOs. But hey, no one said it would be easy!