The cryptocurrency market is flooded with altcoins. However, many of them turn out to be scams. It is always important to do proper research on these coins before getting involved in the community and trading. There are some beneficial altcoins like DasCoin that if you trade appropriately will end up giving you large returns.
What to Consider Before Getting Involved in an Altcoin
The Team
The development team of an altcoin, such as DasCoin’s team, provides important information relating to the relevance of the coin and what research has gone into its development. The team’s industry experience is a good point to note. You can easily find this information in the token’s white paper or through the team’s LinkedIn profiles. The more experienced the team is, the better the coin will be.
The Uniqueness of the Solution
Bitcoin was revolutionary with its solution of offering a decentralized currency. Now almost every coin serves this function. Most altcoins try to replicate a solution. Look for something different. A unique solution is bound to gain interest in the future if it is deemed viable. Always check and obtain an understanding of the token’s solution before purchasing the altcoin.
Currency Distribution
Knowing how much of a coin is to be distributed greatly impacts its market value. Always try to find out the quantity sold during the pre-sale and the ICO time window to find out about the currency distribution. Usually, a coin will fetch more in the open market or exchanges, when demand exceeds supply.
Exchange Listings
Exchange listing is always helpful for altcoins. It represents the bullish nature of the coin and its market. Typically, when a credible exchange declares their plans to list an altcoin which is still in its ICO stage, it is a good sign.
Blockchain Relevance
All of the new ICO’S must be launched from an existing blockchain, unless there are plans to make a new blockchain for the token. The blockchain that is used indicates which cryptocurrency base is needed for participating in the ICO. For example, if an altcoin uses the Ethereum blockchain, it can only be purchased using ethereum.
Other Considerations
The strength of the altcoin’s community, as well as the community’s activity can illuminate the health of an altcoin, like DasCoin. Online communities can be found on Reddit and bitcoin.org. The hype generated in the particular community is a glimpse into what the future holds for the coin.
Pump and Dump schemes can affect any coin, and should be a reason to not get involved with a particular altcoin. This scheme follows the idea that you buy the coin at a lower market cap, promote it, and sell it at a higher market cap. People increase the price of an altcoin by the means of promotion and endorsement, however the value is not real. This person accumulates cheap coins in a short while and sells it off to unsuspecting newbies.