How to Know Which Cryptocurrency to Invest in Before It Goes Public?

For the last couple of years, cryptocurrency has been a trending topic because the world has finally realized the immense potential that it holds. It is now a payment option in many online and retail platforms, including regulated iGaming sites like Vulkan Vegas. So, owing to the increased mainstream adoption, a lot of people have been looking into how they can make a profit from trading cryptocurrency as its popularity continues to grow.

When you play your cards right, you can earn substantial proceeds from the crypto market, but you must do your research before parting with your cash. The danger in getting caught in a crypto hype is you might be dealt a bad hand and lose your hard-earned money. Investors who have purchased cryptocurrency in the past and played smart have ended up with shining portfolios worth a ton of money. An excellent example is Tyler and Cameron Winklevoss, who joined the billionaires club after investing the settlement money they received from Facebook (now rebranded to Meta) in Bitcoin in 2012 and 2013.

Following an increase in Bitcoin’s price over the years, there has been a mushroom of digital currencies in the market, and investors are looking for the next big thing. If you are interested in investing in a new cryptocurrency before it goes public, you need to know if it will take off before betting on it. But unfortunately, even with the amount of crypto information you can get your hands on today, it can sometimes get very confusing. So, here are the indicators you need to check before investing in any cryptocurrency.

The Team Behind the Crypto

The team behind the crypto you want to purchase should be experienced and more so credible because they play a significant role in whether the project will succeed or fail. Except for Bitcoin, if the team behind the crypto is unknown, that is a red flag.

Additionally, you will need to know the team’s previous crypto projects and examine if they were successful. Lastly, another good sign that the crypto will succeed is if the crypto project has reputable partnerships and executives.

Crypto’s Roadmap and White Paper

Before purchasing a digital currency, go through the crypto project’s roadmap and white paper. The project’s roadmap provides investors with a set of expectations on how the project will grow and evolve once the cryptocurrency is launched.

The white paper, which is released by the crypto project, gives investors the technical details on whether the crypto has any value. If the roadmap and white paper of a crypto project are not clear, then there is a possibility the future of the crypto hangs in the balance.

Adoption Prospects

According to Finder.com, about 27 million Americans have one or more cryptocurrencies, with 44.5% being Bitcoin. However, the number of crypto holders is yet to reach 10% of the American population. According to these statistics, it is fair to say that we are still in the very early stages of crypto adoption.

Nonetheless, the adoption of cryptocurrencies is revolutionizing industries. For example, in the finance industry, a transaction that would have previously taken weeks takes a few seconds when you use crypto. Therefore, if a cryptocurrency is resourceful, it will have the edge over others, so it may be worth investing in.

Number of Coins in Supply

From inception, the maximum number of tokens in circulation is pre-determined, meaning once the mining of all available tokens is exhausted, no more will be produced. Therefore, if investors are interested in the crypto and the supply is fixed, the crypto price goes up.

Support from the Crypto Community

The community around any crypto project is, on most occasions, the deal breaker. Their enthusiasm towards the project plays a crucial role in determining whether or not the digital currency succeeds during its launch and its performance in the long run.

Every investor’s objective is to assess if an asset’s intrinsic value is overvalued or undervalued. However, if the crypto project gets overly hyped and the coin’s actual value is masked, it can get very confusing when you consider purchasing the crypto. In such instances, you must be careful, and you should try to seek more tangible evidence of the crypto’s validity.

Crypto Backing

Check if the crypto already has any backing from investors. Why? If the crypto has support from prominent investors and renowned investment companies, it is a digital coin worth looking into. It is because the firms have done their due diligence and consider the crypto a wise investment.

Because cryptocurrencies are unregulated, they tend to be volatile and unpredictable in nature. However, if you want to invest in any crypto market, you must first familiarize yourself with blockchain technology and digital currency to understand how the crypto industry works. This is especially the case if you are new to the industry. Better still, you can seek professional help to help you navigate the crypto market and avoid scams.

All in all, the rule of thumb in cryptocurrency investing, like any other industry, is that you should never put in money that you can’t afford to lose. That way, in case things go sideways due to unforeseen circumstances, you will stand tall and perhaps even learn from the unfortunate situation to apply the knowledge in the future.