The crypto-sphere has been booming in recent years and there are numerous projects that are gaining attention in this space. In fact, many of these projects are finally showcasing a workable product that everyone can already use. I'm really enjoying my time here in the crypto space as the ideas from 3 years ago have already materialized.
With all of the amazing projects at hand, how can we really tell which are the ones that may get close to what BTC & ETH have achieved in terms of market?
In the entirety of my journey in the crypto space, a notion that I keep hearing is...
"Don't put all your eggs in one basket".
What it means is that I should not concentrate all my money or resources on a single coin or project. To diversify my assets is a good strategy to mitigate the risks with my investment.
I'm sure that the majority of us are also following this rule and are already holding a bunch of different tokens in our portfolio.
Aside from BTC or ETH, stable coins & altcoins are the next in line to which you may invest your money. You may choose a variety of coins with a large market cap or small market cap coins. I can't really tell which ones are better between the two types but what I noticed is that the majority are geared towards investing in large-cap coins. One of the reasons is that the large-cap coins are more resilient to market manipulation since it has more volume in comparison to small-cap coins.
Even so, there are investors who may prefer to invest in small-cap coins with the hope of much higher gains. Usually, the small-cap coins are the ones that have the potential to achieve 10x, 100x, or even 1000x growth in value. However, it may also go the other way and drop significantly low to near zero value.
If you intend to venture into the dangerous waters of the crypto-sphere, you must make sure to bear in mind these pointers.
Assess your financial capacity
Invest the money that you're willing to lose. This is especially true for projects that don't have a proven track record yet or a team that you're not familiar with. You have to bear in mind that you're investing in crypto; it's not regulated by an authority and there is no one who is accountable for it. If the project fails and no one pursues to keep it going then your investment will also fail to exist.
DYOR (Do Your Own Research)
Many of the new crypto projects are simply selling an idea. Sure there is a whitepaper that outlines every detail of the project however, I believe the primary consideration is whether the project is feasible or not. What must be known before investing in the project is whether there are existing solutions implemented by other projects that could help solve the challenges that the project you are investing in is applicable.
Learn more about the Lead Team
This might not apply to every crypto project since there are instances where there is no lead team who is working on a specific project. It is common for crypto projects that the ones working on it are anonymous.
However, for new projects, I suggest that you must make a thorough research about the people who are actively working on them.
What I normally do is look at the credibility of the main persons involved with the project. It would be great if they have a LinkedIn account in which their achievements are verifiable.
If the project has no proven track record and the team is anonymous then I might not even research the project at all. That's just my personal opinion. And since I'm investing my money in it, I think that it's my responsibility to be diligent when it comes to learning more about the project before I invest.
Final Thoughts
I'm sure that there are more pointers beyond the ones that I mentioned in this post but I believe that these are the most basic that one should bear in mind when it comes to crypto investing.
There are a lot of invest-able projects in this space. Make your investment count!