Investing in new crypto coins in Q4 2024 – What you must check beforehand
Disclaimer: This article is intended for US audiences.
New crypto coins are launched every month, joining the 2,000+ coins that are already on the market. Some of these coins will go on to become major altcoins, but some will fade into obscurity. Although it is impossible to determine exactly which coins will prosper and which will struggle, there are factors you can and should check before investing.
Why Invest In New Coins?
The cryptocurrency market is still in its infancy, at least compared to the foreign exchange and stock markets. However, major coins like Bitcoin and Ethereum are close to their all-time highs. This makes it more difficult to achieve the massive profits seen by early crypto investors.
However, new coins and new projects still have the potential to see their prices increase tenfold or more. This is especially true of those projects that go from presale to becoming some of the newest coins on Coinbase. News of a Coinbase listing can give coins considerable boosts while also making them more accessible to the average investor. According to crypto writer Michael Graw, a Coinbase listing gives an average 91% price boost within the first five days of listing – real food for thought.
Check The Whitepaper
Coins have a long way to go before they are listed on Coinbase. Many new coins and tokens fall by the wayside before they reach that point. Ensure any coin you want to invest in has a whitepaper and analyze the whitepaper contents to ensure that the project meets Coinbase’s requirements for listing. The whitepaper holds all relevant information about the coin and its future development.
Research The Tokenomics
The token economics, or tokenomics, shows key information about how coins will be distributed. Expect to see a portion set aside for presale, some reserved for the management and development teams, some for airdrops, and some for marketing and other purposes. Look for factors such as how many coins the development will keep for themselves. If they keep a large enough portion, they can, theoretically, elicit some control over price movements.
Who Are The Team Behind The Coin?
Successfully launching a cryptocurrency takes a team of developers, designers, marketers, and other professionals. Details of the main team members can typically be found in the whitepaper. Check their work background and ensure they have relevant experience or knowledge. Also, research the marketing team to ensure they will do a good job of promoting the coin.
Check Social Media And Media Sentiment
The success and failure of meme coins are determined almost entirely by social sentiment. Even utility coins need positive sentiment to get them off the ground. Check social media websites, Reddit, Telegram channels, and general media to gauge the level of interest in a coin. Dogecoin saw massive increases and has become one of the biggest cryptocurrencies as a result of a very strong community, initially, followed by major endorsements.
Are There Any Viable Use Cases?
Meme coins do not typically have utility, although some modern coins blur the lines between these two categories of cryptocurrencies. In the case of utility coins, check the use cases for those coins. Determine whether there is, or will be, demand for the coin and ensure the proposed use cases are viable.
Deals In Place
For utility coins, you can also look for projects that have deals or uses already in place. This is possible with some bigger coins, and with those that have been established to meet a specific requirement. For others, such as layer 2 coins, look for existing deals or determine whether other companies and other coins are talking about their launch.
Check The Roadmap
A roadmap is a timeline that highlights the development, marketing, and progression of the coin in the coming months and years. The roadmap may not include exact dates but should give a clear vision of where the coin is heading, including marketing plans and targets for being listed on exchanges. However, there are no guarantees that coins will be listed on major exchanges. The roadmap should include details of when presales will end, whether tokens will be burned, and whether the project will develop its own blockchain layer.
Are There Any Rewards?
If you are investing in a presale, you will usually be granted some kind of reward. This can include discounts on the proposed listing price of the coin but may also include additional bonuses like airdrops. The earlier you invest in a project, the greater the bonuses are likely to be, and the better the bonuses, the more the project is likely to attract investors, although too much of a bonus might prove unsustainable.
Do You Have The Budget?
Some coins that get listed on Coinbase do experience significant increases in prices. However, some see their prices fall, and not all coins go on to achieve a Coinbase listing in the first place. You need to be prepared for the fact that you might lose any money you invest in a presale or new coin, so be sure you have the budget and can afford to lose the money you intend to invest.
ADVT.
This article is brought to you by Bazoom Group ApS.
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