Best New Crypto To Invest: Top Picks

The cryptocurrency market is a volatile and unpredictable space, with thousands of coins available to trade. Bitcoin and Ethereum are the two largest cryptocurrencies by market cap, but there are many other options for investors. When choosing a cryptocurrency to invest in, it is important to consider the coin's functionality, rewards, and consensus mechanism. Other factors to consider include the level of adoption, transaction speed, and fees associated with the cryptocurrency. It is also essential to remember that investing in cryptocurrencies is risky, and prices can fluctuate significantly.

How to research and choose new crypto investments

Do Your Own Research

It is important to do your own research and make informed decisions. This is one of the most valuable lessons you can learn as an investor. Relying on others to do your research for you is not a smart investment strategy.

Study the Whitepaper

A whitepaper is a document that explains the technology behind a blockchain project. It is usually written by the developers and can be very technical. A good whitepaper will include information about how the company plans to use blockchain technology to solve a problem in their industry or develop its product or service.

Know the Team Supporting the Project

If there is a specific team behind the cryptocurrency network, evaluate their track records to see if they have the required skills to bring the project to fruition. Check their public presence on social media and their website. For developers or engineers, check GitHub for open-source contributions.

Analyze Economic Activity

Analyze the economic activity of the project. Check price charts for any price movement and activity, and consider the historical outlook of the asset's performance.

Market Capitalization

Market capitalization is one of the most important metrics used by investors to determine the size and health of a cryptocurrency. It is calculated by multiplying the current price by the supply of coins in circulation.

Liquidity and Trading Volume

In finance, liquidity refers to how easily an asset can be bought or sold. In the case of cryptocurrencies, coins that have been around for a while will likely have high liquidity, while newer tokens may be illiquid, with low trading activity and difficulty selling.

Assess Socials Engagement and Community

Check the social media accounts of a project before investing. Twitter, Telegram, Discord, and Reddit are common platforms. This is where you'll find most of the information about the team and their plans.

Check for Potential Scams

Scammers will use fake websites and social media accounts to trick you into sending them money. Use free tools like Scamsnipper, BSCheck, or RugDoc to help protect yourself.

Other Considerations

• Prospects: Identify a cryptocurrency with an edge over others, such as providing a solution to a widespread problem.
• Supply and demand: Consider the circulating supply of a cryptocurrency and how it compares to the total (max) supply.
• Price and volume: Up-to-date information about cryptocurrency trading is easily available online, allowing you to identify coins with momentum.

Remember, investing in cryptocurrencies is different from traditional investing. It is important to know where to go for information and updates and how to analyze them to determine their potential.

The risks of investing in new crypto

Investing in new cryptocurrencies can be risky due to their volatile nature, regulatory uncertainties, and potential for scams. Here are some key considerations before investing:

Volatility

Cryptocurrency markets experience rapid and significant price movements due to their high volatility. This makes it challenging to predict short-term investments, and the shorter the trading time frame, the higher the risk. Volatility is driven by sudden shifts in market sentiment, and the intensity and spread of these shifts are more prominent in the crypto space than in other financial sectors.

Regulatory Uncertainties

Government regulations surrounding crypto are constantly evolving and vary across different regions. These regulations can impact how you use and access your crypto investments. As crypto is a relatively new asset class, it may take time for policymakers to establish clear and consistent guidelines.

Scams and Security

The decentralised nature of crypto makes it a target for scams and cybercrimes. Some newer coins may pose a higher scam risk than more established cryptocurrencies. Additionally, there is no protection or insurance for lost or stolen cryptocurrencies. Peer-to-peer transactions, which are common in crypto, also carry risks such as a lack of refunds and the possibility of human errors.

Loss of Private Keys

A private key is a cryptographic string of letters and numbers that allows access to crypto assets. If you lose your private key or it becomes corrupted, you may lose your crypto funds entirely.

Tax-Related Concerns

The tax status of cryptocurrency investments and returns can be uncertain. The classification of cryptocurrencies as assets or currency varies across different jurisdictions, which can impact their tax treatment.

Uncertain Future

While cryptocurrencies are gaining popularity, their future remains uncertain. Unlike traditional finance, which has a long history, cryptocurrencies are still in their infancy.

Due Diligence

It is crucial to perform thorough due diligence before investing in any new crypto asset. Research the project's tokenomics, white papers, and roadmaps to understand the unique selling points and use cases. Be cautious of projects that promise quick riches or guarantee high returns, as these could be scam indicators.

New crypto vs established crypto

The cryptocurrency market is an ever-evolving domain, with new coins and tokens being introduced regularly. These new releases are challenging more established digital assets such as Bitcoin and Ethereum.

New Crypto

New cryptocurrencies are constantly emerging, and they can offer new and exciting opportunities for investors. However, it is important to approach new crypto coins with caution, as they can surge in their early days, only to crash abruptly soon after.

When assessing new crypto assets, it is crucial to perform due diligence and learn as much as possible about a project's tokenomics. White papers, commonly found on a startup's website, can offer valuable insights into the digital asset's unique selling points, use cases, and future roadmap.

Additionally, some new crypto coins may only be listed on smaller platforms, where trading pairs link them to stablecoins, Bitcoin, or Ethereum, rather than fiat currencies. As a result, it can take time for new cryptocurrencies to gain traction and achieve widespread adoption.

Established Crypto

Bitcoin and Ethereum are the two most well-known and established cryptocurrencies. Bitcoin, created in 2009, is the original cryptocurrency and has become a household name. Ethereum, on the other hand, is a blockchain platform that enables smart contracts and decentralised applications. Both have experienced tremendous growth since their creation.

Established cryptocurrencies have the advantage of a larger user base, higher market capitalisation, and greater liquidity. They are also more widely accepted and trusted, having stood the test of time.

Both new and established cryptocurrencies offer unique opportunities and considerations for investors. New crypto coins may offer higher potential returns but come with greater risk and less stability. Established cryptocurrencies, on the other hand, provide more stability and reputation but may limit opportunities for innovation and extremely high returns.

Ultimately, the decision to invest in new or established crypto depends on personal preferences, risk tolerance, and investment goals. It is crucial to perform thorough research and understand the risks and potential rewards associated with each investment opportunity.

How to buy new crypto

When considering investing in new cryptocurrencies, it's important to remember that the market is dynamic and unpredictable, and all investments carry risk. It's recommended that you only invest money that you are willing to lose. Here is a guide on how to buy new crypto:

Do Your Research

Before investing in any cryptocurrency, it's crucial to do your research and understand the project behind it. White papers, commonly found on a startup's website, often detail a digital asset's unique selling points, use cases, and roadmap for the future. It's also important to remember that the value of cryptocurrencies can be highly volatile, and there is a chance of significant price fluctuations.

Understand the Risks

Cryptocurrency-related investment markets are very different from regulated securities markets. For example, securities laws provide important protections that you may not get when dealing in crypto investments. In many cases, you may not know exactly who you are dealing with, where your money is going, or what you are getting in return. Celebrity endorsements should also not be a reason to invest.

Be Aware of Scams

Trendy investments are a target for fraudsters. Scam artists prey on the newness of an investment opportunity, and it's easier to sell investors on an "everyone is buying it" pitch when there's a lot of buzz. Don't fall for high-pressure sales tactics, and be aware that if you lose money, regulators may not be able to help you recover your investment.

Consider the Exchanges

The latest digital currencies don't always appear on major exchanges such as Binance or Coinbase immediately. Fledgling projects are often listed on smaller platforms, where trading pairs link them to stablecoins such as Tether, as well as Bitcoin and Ethereum. Tokens featured on major exchanges generally offer better liquidity, attracting larger investors and a broader audience.

Assess Community Adoption

A project's success will depend on levels of adoption in the crypto community. Buzz on social media and, more importantly, trading volumes can provide an indication of how much traction a project has.

Buy and Store

You can buy cryptocurrencies through crypto exchanges, such as Coinbase, Kraken, or Gemini, or via brokerages such as WeBull and Robinhood. Remember that there may be costs and fees associated with having a crypto wallet and/or an account on a brokerage or exchange. Ensure you understand all the costs involved before investing.

New crypto trends to watch

The crypto market is an ever-evolving domain, with new coins and trends constantly emerging. Here are some of the new crypto trends to watch:

Play-to-Earn Games

Play-to-earn (P2E) games are one of the latest and biggest trends in the crypto space. These games combine non-fungible tokens (NFTs), in-game tokens, decentralised finance (DeFi) elements, and sometimes even metaverse functionality. Unlike traditional gaming models, P2E games allow players to earn income by participating.

A prime example is Axie Infinity, a Pokémon-inspired game that reached over 2.7 million active players. Players collect, breed, and battle digital pets called Axies (NFTs), earning Smooth Love Potion (SLP) – the in-game reward token. This was especially popular in developing countries like the Philippines, where players could earn a decent income.

Decentralised Finance (DeFi)

DeFi is one of the biggest growth areas in the crypto market. Many tokens in this industry relate to governance, giving owners the right to vote on proposed improvements to a network. Others are used for staking rewards.

Artificial Intelligence (AI)

AI is one of the most exciting recent technological developments in the crypto space. Cryptos like the Superintelligence Alliance, a merger of three popular AI cryptos (SingularityNET, Fetch.ai, and Ocean Protocol), are well-positioned to capitalise on the growing trend of companies adopting AI.

Decentralised Applications (dApps)

DApps are software applications that run on a blockchain or peer-to-peer network without a central authority. Ethereum, Solana, and Cardano are some of the top blockchains that support dApps development.

Blockchain Technology Advancements

Advancements in blockchain technology continue to drive innovation in the crypto space. This includes improvements in speed, security, and energy efficiency. For example, Ethereum's transition to a proof-of-stake system has made it a greener investment, and Avalanche's unique consensus mechanism improves transaction finalisation.

Metaverse and Web3

The metaverse and Web3 are also gaining traction in the crypto space. Projects like AdaSwap, a decentralised finance app built on the Cardano network, are aiming to drive the adoption of Web3 and the decentralised web.

Frequently asked questions