How to choose digital currency like a pro?
In the face of hundreds of currencies, how do you choose a digital currency and how do you accurately find the currency with investment value? In embodying the value of a digital currency, there are several characteristics that should be noted.
How to choose digital currency like a pro?
Below we will show you in many ways how to choose a high-quality digital currency:
1. Basic information about the currency:
The total amount of coins, the order of the market value traded, the highest and lowest prices in history, the ups and downs, the trading volume.
2. Look at the project technical document:
The best way how to choose a digital currency and look at the white paper of the coin, you can find out the mechanism of issuance, share distribution, usage, total amount of tokens, closing period, whether there is more issuance, long-term planning as well as founder, founding team, investor background, etc.
Judging the quality of the coin by the white paper The most reasonable position is that the net internal holdings of project employees should be less than 25%.
3. Whether it has been listed on the prevailing stock exchanges:
And whether or not it can be transferred to mainstream cryptocurrency wallets.
Whether the currency can be found on the prevailing exchanges, and the currency of the dominant exchanges can be omitted, because the exchange will check it.
Some privilege coins, coins, and junk coins will only be traded on the trading platform that they have created themselves.
When some coins are inaudible and invisible, go to the mainstream exchanges, such as OKEx, etc.
How to choose a digital currency If this currency is not on any major exchange, it should not be a good currency As for his white paper, no matter how high it is, don’t make any tricks.
I think that because exchanges are in circles, they have more industry news than our average retail investors, and can better judge which currencies are junk and which ones can survive in a bull market.
4. Community Building and Maintenance:
The so-called community refers to the fan group of a particular currency and the official organization, including Twitter, public account, WeChat group, Weibo, QQ group, telegram group, etc.
The more fans, the more activity the team actually working will have managers in the community to deal with, strengthen and maintain some issues at any time.
5. Open source code updates:
Open source code is the technical basis for the generation of digital currency, one of the foundations of governance at the technical level of the currency.
Check coin code update frequency to get a basic judgment on the results of the technical team work.
Token development publishes open source code A real digital currency, like Bitcoin, publishes open source code at the same time as it is released.
6. Related news:
You should understand the latest news and whether there is any negative news etc., industry news and official information in general, because some news will cause the price of a currency to go up or down.
In addition to the simple basic judgments mentioned above, we have to judge the value of a currency.
How to judge the value of a digital currency:
How to choose a digital currency As each value comes from the consensus of the people, i.e. the expected value of the item For example, the diamond itself does not have much value, but through the promotion and interpretation of the jeweler, it is packaged as a symbol of eternal love to continue to attract people and generate consensus, so it has high value.
So, what is the society’s opinion about the prospects for implementing a particular currency, and the human and social development that does not comply with it, and what are everyone’s expectations of it, and what is their confidence? The response to the situation can last for a long time, and taking the situation further, only in line with the trend can develop steadily.
Popularity is also a great value. Only when the public accepts and realizes that an industry or project can make significant progress.
So, the value of popularity and everyone’s expectations are immeasurable From this point of view, those cryptocurrencies that are highly popular in China have good prospects.
For example, there is a consensus of believers hiding behind Bitcoin and this consensus is the most valuable.
If this consensus does not disappear in a day, it means that it will always have value and will continue to exist, in addition to the scarcity of its own quantity.
The market value of the digital currency that Bitcoin represents is getting higher and higher, because more and more people believe in and get to know it, more and more people use and participate in it, and this is an irreversible process.
In the future, we may not need to go through banks or other intermediaries to transfer the value in our hands directly to someone else, such as digital currency, personal creativity, etc.
2. Meaning of Being:
How do you choose a digital currency? Was there a real solution to practical social problems, and could it really be applied? Is there a need to use blockchain technology? The so-called coins have no meaning and are only for misappropriation.
For example, Bitcoin established historical precedent, decentralized, and achieved peer-to-peer payment, which is its intrinsic value.
Part of this value is that it solves some of the problems The emergence of Bitcoin marked the birth of its core technology, the blockchain.
The concept of the blockchain has been accepted by most countries. The blockchain can solve the problem of mistrust between the existing centralized systems, and can be used in value transfer, patent areas, and financial fields, as well as achieving traceability and safety system construction.
3 – Globalization of liquidity and payment:
How to choose digital currency As the liquidity of the digital currency is a test of the value of the digital currency It is the key to the maturity of the digital currency market The digital currency used in the payment field will reflect the value to a higher level.
For example, digital currencies such as Bitcoin, Ripple, and Radar have their own payment systems.
Microsoft, Dell, and steam have opened Bitcoin payment channels, and many merchants also accept payments in Bitcoin or other digital currencies.
Digital currency trading is not only a reciprocal transfer between investors on a trading platform. The value of digital currency lies in the application of digital currency, and its applications will become more and more with the development of the Internet, as opportunities and markets will appear in it.
Based on the above judgment, some high quality coins can be basically sorted out of these thousands of coins, many coins are speculative and have no real value.
Therefore, we must know how to analyze and understand its value in order to invest better.
In addition, to prevent stepping on thunder, it is highly recommended that beginners only trade on the world’s top three exchanges (such as Binance, Huobi, and OKEX), where asset security is higher.