Good Evening Steemit!
At present, cryptocurrencies do not fail because of technology or lack of use cases, but simply because of the lack of acceptance among broad sections of the population. It is therefore clear that in the long term the cryptocurrency will establish itself as money, or universal means of exchange, which manages to establish this acceptance.
I have therefore developed for myself a simple 10-point rating scheme that allows you to quickly assess the quality of a coin or an ICO.
Overall, I have identified 5 areas for which I award between 0 and 2 points each. Overall, a coin can therefore get a score in the range of 0-10, which is a familiar scale for most. So what are the 5 major areas that are included in the analysis?
- Usability General
- Easy and fast transactions
- Technical added value & investment scenarios
- Team & Marketing
Ease of use is a broad term that needs some clarification. What is meant by that?
This is where factors such as the software, such as the wallet, come into play. Lite wallets are definitely the better choice for 99.9% of potential users. Hardly anyone will have the patience to download the full blockchain before they can start using the coin. In addition, in this case, you have to wait anew each time you start the wallet until the blocks are synchronized.
Also, the presentation of the website and good tutorials there have a share. Ideally, using the cryptocurrency is as easy as using a smartphone: anyone can do it without help. In reality, it usually looks different and the inventors / operators of the cryptocurrencies tend to be more tech-savvy in their language and the design of their software. This creates high and unnecessary market entry barriers.
Easy and fast transactions
Blockchain has the greatest potential in financial transactions. This is because the classic blockchain is a relatively expensive and expensive way to transfer data. Therefore, the data that is transmitted must have an inherent value. This is always the case with financial transactions. For a "Youtube" on the Blockchain, this would not be the case, for example: Here, gigantic data volumes are transferred that have only a very small monetary value.
That's why the simplicity and speed of financial transactions is central. Ideally, such a transaction on the block chain must be easier than an online bank transfer. If you look at the current state of many cryptocurrencies, it seems a long way to go.
Availability means availability against Fiat currencies like Euro or US Dollar. It does not help a technically uninitiated beginner if the coin in question is listed on 10 different exchanges and can only trade there against Bitcoin (BTC), Ethereum (ETH) and other cryptocurrencies. The currency must be easy to obtain and available at obvious points of contact for a small fee. A solution must be found for this problem. Most people would expect to be able to easily buy ETH at Ethereum.org.
This also raises the question of whether the currently dominant proof-of-work, in which gemined must be, is not a hindrance in terms of wide acceptance and whether possibly a proof-of-stake system with a fixed number of coins, in which Tokens such as GAS issued at NEO could not be the better choice.
Technical added value & investment scenarios
This category tries to map relevant advantage over the use of classic money like Euro or Dollar. All typical properties associated with cryptos, such as anti-counterfeiting security, decentralization, etc., are included here.
Of course, the decisive factor is the investment scenario, especially for ICOs. Here you have to critically ask the question of why the ECR20 token, or even a coin, should gain in value dramatically in the future.
Especially with the tokens that are obtained from ICOs, this is important because, contrary to popular belief, they are not shares in the company. So it's not a stock, but primarily a transactional vehicle that allows the publisher of the token to collect ETH and BTC. The information about which equivalent of tokens should even be offered can be found in the typically whitepaper and there are often negative surprises waiting for you.
Team & Marketing
The aspect of marketing is clearly underestimated by the current market leader, I personally never met an advertisement for Bitcoin in the "real" world. For some of the Altcoins, such as EOS or Dash that looks different, here is advertising from a budget available for it.
Last of course, the team behind the coin also plays a big role. This not only means programmers, but also people who do public relations work. It goes without saying that the study of Linked.in and other social media profiles plays an important role, paying particular attention to signs of fake profiles. People who are led as advisors should only be cautiously involved in the evaluation, since cases are often known in which, for example, Vitalik Buterin was mentioned as an adviser, but according to his own statements, he only had 30 seconds of contact for a selfie with the people of the project.
All the aspects mentioned are fundamentally important in my view, but rigid models, such as those presented here, never fit 100% on an individual case. That's why it's important to keep thinking about which of these points might be higher in a given project than just an investment decision.
All the best!