The crypto market is currently full of tokens that are either worthless or whose value may disappear soon because of low market interest. However, how can you know whether the cryptocurrency you hold is a good investment or not?
Here are the top 5 signs to bear in mind when looking at different alt-coins in the market:
Background Check
One of the first steps in determining whether a currency is a good investment avenue or not is by checking it’s GitHub ‘commit history’. If the token has had a significant amount of commits made to it in the past few months, it is quite likely that the project is safe, but if the commits made are insignificant, then it is a sureshot sign that the coin is a scam.
No Real-Time Utility
If the currency in question has been designed solely to serve as a ‘store of value’, then the token should be avoided at all costs. Most legitimate crypto projects feature integration with important sites so that the currency in question can be used to make purchases with online.
Copied Coding
Another useful way of determining the validity of a cryptocoin is by viewing its intrinsic design code. If the currency is an exact fork of another coin with no meaningful change to its functionality, you should immediately become wary of the project.
No Available Use Cases
Many crypto tokens feature a good looking website where they use terms such as ‘complete decentralization’, ‘transparency’ to promote the project. However, after sifting through such terms if you are unable to find any specific use cases of the technology, the currency is most likely a facade to make a quick buck.
Lack of Team Details
One sureshot sign of recognizing a scammy token is if the project does not provide details of its core development team or any of the other individuals actively associated with the venture.
If any of the aforementioned signs ring true in your case, it is best to dump such a currency as soon as possible.
Disclaimer
Please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. CryptoMode is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.
