Money & Finances

5 Signs That Cryptocurrency Is Becoming More Legitimate

Investing in the crypto world, especially as a new investor can be quite a challenge. What with all the many different coins that are currently in the market. Which ones would you know that is best to invest in at any point in time and what to do whenever the market fluctuates even the slightest bit to shift in one direction? Maybe you try bitcoin. Sure, it sounds like a safe bet, right? But maybe you don’t have the $9,000 to part with, just so you can get your hands on one bitcoin.

Cryptocurrency space has easily dominated the investment news cycles in the recent years and the hype is undeniable no matter what any investor or analyst is talking out there. It doesn’t even seem to matter the trend of the market and the fact that dozens of new cryptocurrencies are launched each month, and with these, so does the new coins and tokens which all come with initial coin offerings. But still, you the serious investors can’t have failed to notice that cryptocurrencies have all generally experienced a rather disappointing first quarter this 2018. One fact remains; that there is money to be made; and lost here and where there is money, scammers follow.

So, here are five signs and precautions to can follow to ensure you only engage with and invest in legitimate cryptocurrencies and don’t fall prey to the online scammers looking to make a quick score with your money.

1. Know the team

The administrative team and developers behind the whole projects are, perhaps, the most important factors for any cryptocurrency or ICO. You will find superstar names and developers like the Ethereum founder, Vitalik Buterin, who has a record of making and breaking projects even just by having their names included in the development teams. It is for this reason that new investors need to be exceptionally careful when venturing in this new investment field as scammers can also very easily create fake founders and biographies for fake projects in an attempt to dupe you.

2. Pore over the white paper

An ICO or cryptocurrency white paper is what you can call the foundational document for that particular project. It should clearly lay out the strategy, goal, concerns, background, and timelines for the implementation of any block-chain-related project. It is necessary that you always read through the white paper as carefully as you can and check whether it has complementary sources too, like the financial records, SWOT analysis, and any legal concerns. Avoid all companies which don’t offer a white paper. They are probably fraudulent.

3. Look to the token sale

All legitimate tokens depend on a token or currency system for them to facilitate a crowdfunding process. And the legitimate companies usually make the system and the whole progress of the token sale easy for any potential investors to see. You need to look at the token sales figures, even as the ICO is ongoing. You can even watch the token sales and see how the whole process is moving.

4. How feasible is the project?

Cryptocurrencies and ICOs with the greatest chances of success are usually the ones which have a fundamental structure to surpass their competitors. If you do enough studies, you will realize that even some of the highly-publicized launches end up being sputtered right after the initial interest fades. You need to look for the companies that have an achievable and feasible set of aims.

5. Exercise caution

Enough online research will also show you that even some of the most successful cryptocurrencies and ICOs can sometimes be slammed especially the ones which are usually fueled by speculative investing. Try to avoid the idea of getting rich quick. Nothing like that exists, and you should get it out your head. Be super-cautious when looking for investment opportunities when it comes to the cryptocurrencies and ICOs. Don’t fall prey to someone looking to make money off you at your own expense and ignorance.

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