Which cryptocurrency should you invest in?

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Cryptocurrencies have become the talk of the town. From youngsters to seasoned investors, all want to know more about cryptocurrencies. Though buying and selling have become extremely simple with the help of smartphones, one thing that still most people wonder about is where to invest in, particularly when there are more than 11,000 cryptocurrencies available in the market. Should one stay only with big names like Bitcoin and Ethereum and stay away from lesser-known cryptos? What should be the approach when the market could be full of fake cryptocurrencies? How to identify the right ones?

“One can identify the fake coins based on what strong community traction is around that coin. Another factor one must keep in mind while identifying counterfeit coins is who is answering your queries and issues with that coin. Also, one can check if they’re delivering on the roadmap and project that was promised. One usually should take an extremely cautious approach to invest in, especially in the newer tokens. One also validates the genuineness of coins by cross-checking its listings on legitimate exchanges. Exchanges like Bitbns have a separate team with a stringent process of verifying the coin before it gets listed,” said Gaurav Dahake, CEO and co – founder Bitbns.

Experts say investors should read the whitepaper – which describes the idea on which a token is created along with the tokenomics. “Once the idea resonates as one with a strong viable future, investors have to evaluate if the team behind the token is able to execute the roadmap as suggested. This can be inferred from interviews, partnerships, news, reviews etc. Backing by a major firm can also indicate the robustness of the roadmap,” said Vikram Subburaj Co-Founder and CEO of Giottus Cryptocurrency Exchange.

Due diligence is equally important on the part of investors. Before investing proper research should be done to understand the project behind the crypto.

“Most rugpulls (when promoters siphon the capital raised without delivering the roadmap) happen because of lack of due-diligence on part of investors. Everyone wants to make quick money but not many spend time to research a particular token before investing. If investors don’t believe they are equipped to evaluate a token, they better stick to investing in established high to midcap cryptocurrencies and not participate in Initial Coin Offerings (ICOs) and IEOs,” said Subburaj.