How to determine the “quality” of the cryptocurrency?

Ted Capwell Updated:

How to determine the “quality” of the crypto currency. How to protect yourself from bad crypto currency?

Crypto industry recently demonstrates just amazing rates of popularity among users. More and more ordinary citizens pay attention to this resource and begin to consider it as one of the very promising tools for investing savings in order to obtain a large profit. Against this background, new coins of crypto-currencies began to appear in the network, which mostly work for the blocking technology. Today we will consider such a problem of the crypto-currency market as determining the quality and prospects of electronic coins, as well as the issue of user safety when performing operations in the world of electronic means of calculation. This set of information will allow you to avoid later problems associated with the loss of the fiat and electronic tools, as well as prompt tools for the most profitable investment of money.

What is a crypto currency?

So, considering that the bulk of users do not understand much about the intricacies of electronic payment instruments and understand the processes that are exposed to crypto-currencies, it’s probably worth starting with basics and security issues. In particular, it is necessary to touch on the topic of fraud in the crypto industry and the choice of safe forms of storage and purchase of coins.

How to avoid cryptocurrency scams

Crypto currency is a specialized online settlement system based on the operation of Blockchain technology. In simple terms, any crypto currency is a piece of computer code that is generated by the information capacity included in the system, in which all the transaction data in the system is recorded. Sorry, but there is simply no simple explanation for this tool! Let’s continue, 10 years ago nobody heard about crypto-currencies except for a few advanced IT specialists, but thanks to their anonymity and high level of protection, as well as prospects in terms of development, electronic coins began to gain popularity. And today the main currency Bitcoin shows records of value – a maximum of about $ 20,000 per coin. It is such a rapid growth and the opportunity to repeat the success of crypto optimists attracts new investors in this field.

Against this background, the crypto market began to be flooded with various scammers who seek to earn on the greed of investors and their ignorance in terms of studying the operation of the crypto currency system. At the same time dealers use a variety of techniques of deception from simple and long-known to high-tech and complex. But no matter what tricks they use, their ultimate goal is to take possession of your means. Let’s look at several approaches to cheating investors in the crypto market.

Fake crypto currency

Against the backdrop of the appearance of thousands of electronic coins based on blockade technology scammers came up with a very sophisticated scheme of deception — the issuance of counterfeit coins. No, they do not forge the main currencies, but simply play on the so-called “forks” of known coins or issue their supposedly future coins in the future.
The distinctive features of the forged crypto-currency are such indicators and data:

• Centralization of e-currency – fake crypto coins are issued in most cases by one issuer and do not offer a mining regime. Simply put, it is a program that runs on a specific service, and generates crypto currency code and distributes coins over the network. Such a crypto currency exists exactly until the server is shut down. To get the maximum amount of investors’ funds, scammers actively promote their product and disseminate information and prospects of the coin, after which they quickly close the project.
• Lack of open liquidity – today the crypto industry allows to attract investment funds for various ICO projects, crypto-currencies have become substitutes for shares. In addition, the bulk of exchange platforms allow for the initial placement of electronic coins (Tokensail). For this reason, the network is full of various tokens available for investment and earnings. And this is a problem, as fraudsters disguise their projects under really promising crypto-currencies. Therefore, it is very important to study their liquidity indicators in the issue of determining bad creditworthiness. Fictitious crypto-currencies are usually offered only on one platform with a certain indicator of current liquidity. If you can not compare the cost of a coin on different platforms, then be sure that this is a hoax!
• Closed code Blockchain – the bulk of crypto currency works in a decentralized mode, so very few people know where the servers of the system and the miners that generate coins are located. Taking this into account, openness is the main indicator of the legality and attractiveness of the instrument. This includes not only the openness of the crypto currency code, but also information about the developer of the forms of accounting for tokens and the final emission indicator. This clearly characterizes the legality of the new electronic coin.

As you can see, it is quite easy to distinguish a fake from a real crypto currency, be careful, and you will not fall on the hook of scammers. Now it’s time to learn how to find tokens that are promising in terms of earnings, which can repeat Bitcoin’s growth performance and allow you to earn a fortune.

How to determine the quality of the crypto currency and its prospects for investors?

Investors who considered the prospects of Bitcoin at the dawn of its appearance in free access were fortunate enough to earn a fortune with the most minimal investment. Yes, buying Bitcoin at $ 50 in 2009, you could earn about $ 5 million today. This success of crypto optimists does not bother many novice investors in electronic coins, so they are constantly looking for a new promising coin for investment and quick earnings. Today the network offers thousands of crypto-currencies and every day there are all new tokens that can become exactly the asset that will allow you to earn.
So, how can we find a profitable tool for investing among such diversity? In principle, it is not as difficult as it seems. The main thing is to know the most important factors and indicators that distinguish quality products from pacifiers. We offer you to consider in detail the indicators characterizing the prospects of the crypto currency:

• What is the idea of ​​a new token, what is its innovation and interest? At the same time, evaluate your own feelings that cause the product as a user and try to learn how other network members react to this idea. An excellent option is to choose a new technology that can solve any global problem or issue.
• Mode of using block-technology. The fact is that it is new forms of using this technology that attract large institutional investors, so such products often become record holders for the growth of quotations.
• Evaluate the stage of product development – if everything is just in theory, then investors are not very willing to invest, the opposite is a token, under which there is a prototype or already a ready product that requires promotion. Therefore, we choose ICO crypto-currencies, which collect funds to promote the finished product
• What format of profit-making offers crypto currency – in this case there are several options:

– Redemption of crypto currency by the issuer
– Standard dividends on ICO
– Use of coins as a means of calculation on a special service
– Profit from the growth of the value of tokens and their sale on the exchange market

Here, the choice is entirely for the investor, but it should be noted that the last format for obtaining profitability is recommended only for short-term investments with a short-term perspective, since it offers the maximum level of risks

• What is the final issue of coins-in other words, how many tokens want to issue a project to raise funds, and is there such a limit at all? In this plan, it is recommended to use ICO with a specific restriction on the number of tokens and a small total amount of coins. Everything is extremely logical: the smaller the crypto currency, the more demand for it, and the higher its value and the rate of growth in yield.
• The ultimate financial goal of the project – if initially the issuer has set completely unrealistic goals – in billions or hundreds of millions of dollars, then there is little hope that he can achieve the goal and become successful. The second point in this plan is how money will be spent. Here, pay attention to the share of tokens in the project costs and the amount of coins that remain to the issuer. If the number of reserve coins remains with the developers of the idea, then this is a project invented only to raise funds, after which the initiators of the ICO will simply drop their tokens in the free market and bring down their value, and investors will lose money.
• How to get out of the project – in simple terms, to whom and how to sell the coins (do not take into account the possibility to sell the crypto currency in the free market)

As you can see, it is not difficult to distinguish profitable coins, the main thing is to take time to study all the important factors of ICO coin operation and the level of its prospects for investment. This is the way today to find those assets that can bring users and investors wealth!



“General Risk Warning: Binary options and cryptocurrency trading carry a high level of risk and can result in the loss of all your funds.”