Crypto continues to grow like crazy. Every day, it seems like the arena gets a little bigger and a little better, but how does one know which investments are worth their time? Kiana Danial – the author of “Cryptocurrency Investing for Dummies” and the founder of Invest Diva – lays it all out for those looking to enter the crypto space for the first time.
Kiana Danial Talks About How to Know Which Crypto Is Real and Ripe
In a recent interview, Danial says a currency’s price should have little bearing on whether it’s good or not. She says there are so many other elements one should examine first. She commented:
Before you look into the price action, you have to look at what we call the fundamental analysis, which is picking the right asset for the right goal.
She says the first thing you need to do is understand what the asset is all about. Know where the currency is coming from and understand the technical factors behind the coin. Danial says:
Focus more on the project itself, on the problem it’s solving, and on where it is deriving its value.
Next, you need to look at the website and social media pages for the coin. Are they clear? Do they look valid, or are there red flags appearing everywhere such as a lack of contact information for the creators? She says that many crypto scams have emerged in recent years, and it’s important to know the teams behind the coins you’re looking to invest in to ensure they’re legitimate.
From there, you’ll want to read the whitepaper for the coin. This document will explain in full detail what the currency is trying to accomplish. Was it designed to help traders get rich, or is it there to enable social justice warriors? She says a strong cryptocurrency project will have every aspect of its journey fully detailed in whitepaper form. She states:
I read the white paper so I can understand where the value is coming from.
From there, one needs to see if the coin is supported by any major investors and look at the community the coin has established. The bigger the community, the stronger and more real the coin is likely to be.
Doug Boneparth – financial advisor and president of Bone Fide Wealth in New York – explained:
It can be a very confusing environment to figure out what’s what and who is who, especially when you have a lot of people really pumping it or being very zealous about it.
When Is a Good Time to Buy?
Lastly, you’ll want to examine the coin’s technical charts and trading history. Danial says:
I look at the charts to see if I want to buy more and what would be an optimal price to buy. This is after I have selected an asset that matches my risk tolerance and my financial goals.