Picking the right cryptocurrency token
Being in the cryptocurrency space is all about finding that token that can make massive gains, some believe that it would be the large coins such as Bitcoin, Ethereum or Zilliqa and others think it would be the smaller, more obscure tokens such as Safemoon or Cumrocket that would give that x1000 return. In other words, we are looking for that next investment that can moon!
There are tens of thousands of cryptocurrency tokens these days with new tokens being launched every day.
The question then is how we identify a token that has:
- massive upside for a windfall
- sustainable growth long enough for us to take profit
Here are my thoughts(based on painful experiences) for picking tokens:
- Ethics of development team: This is number 1 for me. I usually join the telegram group of the token to get a feel for how the moderators are responding. If they sound evasive or cute when responding to questions, I would be very careful.
- Rull-pug/hacked history: Chances are if they have been hacked before, they will be hacked again. Take Bunny.Finance which was hacked this year and the token lost its value from $700 to $15. Then they decided to launch polyBunny and it got hacked again. Now they are launching Mounds. While I believe that the team is honest, their history has been disappointing.
- Use-case: The use-case of the token determines how sustainable the token will be and is the most important for me. My favourite token now is Feeder.Finance, which seeks to simplify the defi journey of choosing which projects to staking and yield farm by automating it for you. Simply choose the auto-stake option and they will automatically allocate and compound the highest yielding protocol. Cumrocket’s use case was in supporting adult-content work through crypto. However, as much as I like that token, widespread adoption has yet to be seen. Ethereum and Binance coin have widespread usage which explains their strong adoption.
- Meme value: This used to be a key point for me, I would invest in meme tokens (such as cumrocket and karen) because of the massive upside that dogecoin and other dog-related tokens saw however these tokens tend to be pump and dump tokens so a lot of attention needs to be paid to this. These days I rather not touch these tokens because anyone can create a meme token and there isn’t much differentiation between these.
So those are my guidelines for choosing crypto tokens. If you have any other guidelines that have worked for you, do leave your comments and a clap!