Crypto has many close-knit investor communities, but it also has its critics. And they aren’t always driven by bad faith: after all, there are risks associated with crypto and legal factors to be aware of. Volatility, for example, is a big thing in crypto, and while it can benefit you when the market wave is in your favor, the value of a crypto can come crashing down just as fast as it skyrocketed. This is why you should be mindful of how much you invest and what you invest in.
New projects can pop up and build hype only to quickly fade away, which is why it’s essential to filter out suspicious projects from legitimate ones. Luckily, there are a couple of reliable sources to help you navigate the market. For example, on Binance, you can find the top cryptocurrencies to invest in and explore various guides and tools ideal for new and experienced users alike. This will help eliminate confusion and help you start your crypto investing journey with confidence. However, before you start looking for cryptocurrencies to invest in, you should ask yourself the following questions:
- How will investing in these kinds of assets impact your portfolio?
- Should you invest in an ICO?
- Is crypto a good long-term investment for you?
- What is DeFi, and does it offer appealing investment opportunities?
Where Can You Look for Cryptocurrencies to Invest In
There are various ways to stay on top of newly launched cryptocurrencies, though it is a very involved process. However, if you’re willing to put in the work, the potential rewards can be substantial. Here are the places you can monitor to check emerging digital assets:
Crypto Exchanges
Crypto exchanges are one of the most reliable sources for pinpointing digital assets that are gaining momentum, and the best thing about using these platforms is that you can invest promptly in an altcoin that is performing well. Some cryptocurrency exchanges list the newly added digital assets on their platforms. In some cases, new cryptocurrencies can be post-hype when the platform lists them, while others may still be attracting attention and offering decent returns for enthusiasts. On some crypto platforms, there are screeners that enable you to filter digital assets based on their market cap, recent price movements, and other factors, to help you find the most promising projects.
Data Aggregators
A data aggregator collects information on specific topics, allowing you to find new crypto. It uses an API, or Application Programming Interface, to identify prices and other relevant market information from various exchanges, and then it presents the data in a unique, consolidated format to allow easy access for users. Aggregators also incorporate features such as portfolio tracking, charting tools, and news feeds. There are some considerations when choosing a crypto data aggregator, such as:
- User experience;
- Reliability;
- Security;
- Trust;
- Support;
- Cost;
- Compatibility.
Websites and Social Media Platforms
You can also use websites to find new cryptocurrencies, but since not all are reliable, you need to DYOR and consider some factors. For example, a legitimate site will always state clearly who runs the company, how they make money, what their mission or purpose is, and so on. Furthermore, it relies on verified data sources rather than price predictions or online rumors. Besides a website, social media can be a good source, as it’s known for its ability to transmit information quickly. For instance, X is one of the fastest-moving and -responding platforms in the U.S, allowing you to find crypto founders and developers who post whenever new coins emerge or there are any changes. On X, you can even set notifications for specific keywords, such as new crypto, crypto, or crypto release, allowing you to receive alerts about any crypto-related tweet.
NFT Marketplaces
NFTs are assets that have been tokenized (tokenization means linking hashed information from the asset and storing it on the digital ledger). Tokenization establishes ownership, as network validators must verify it through consensus. NFTs are also part of the metaverse, an evolving tech trend that enterprises operating in the digital landscape have championed. On popular NFT marketplaces, you can find non-fungible tokens ranging from hundreds of dollars to tens of thousands of dollars.
DeFi Platforms
Decentralized platforms combine programming, blockchain, and user interfaces that enable you to build decentralized applications. Some might offer exchange and trading services, but generally these platforms support DeFi applications such as borrowing, peer-to-peer lending, and liquidity provision.
Many DeFi platforms also have native tokens, which are utilized within their networks for transactions specifically.
Factors To Consider When Researching New Crypto Coins
Beneath their technical jargon, digital assets serve a purpose, whether as a utility token or only as a payment method. Here are some considerations when identifying a legitimate project:
- Liquidity. Any digital asset requires liquidity, meaning it should have sufficient trading volume so you can sell it quickly if needed. Suppose you find a crypto with no volume; it’s best to wait and see if it develops any. If investors aren’t trading large amounts of a digital asset, it could be a sign that it isn’t worth buying.
- Value. It’s essential to identify the value of a specific crypto, or its potential future value. If it has value to you, there’s a good chance others will value it as well, and note this isn’t only in monetary terms. The value could also be intangible, like an NFT, which you identify with personally.
- Use cases. Ethereum’s token is used as a payment system on its blockchain, making it an ideal example of a use case that might appeal to someone. Bitcoin, on the other hand, was created solely as a payment method, but when investors saw its price climbing, the token gained another utility. As the pandemic shut down much of the global economy and stock markets tumbled, Bitcoin became a safe haven for those seeking to preserve value even in these challenging times.
The Bottom Line
Investing in cryptocurrencies is a high-risk, high-reward affair, which is why it’s advisable to approach it carefully and take the time to assess the factors discussed above to determine a project’s legitimacy. Crypto exchanges, data aggregators, websites, social media platforms, decentralized platforms, and NFT marketplaces can be among the best sources for finding the best cryptocurrencies to invest in but make sure to invest only in a token because you find it valuable, not because of hype. It can help to consult with a finance professional beforehand to assess if this type of asset class makes sense for your financial circumstances and your goals.