Which Crypto Coins You Should Avoid Buying?

April 11, 2022

Reading Time: 3 minutes

As of February 2022, over 10,000 cryptocurrencies  have been known to be in existence, and amongst these coins, the choice of investment of any investor differentiates the bandwagon from the financial market analyst; for a crypto coin to attract great investors, it should possess a defined, specific and innovative goals, coins with such attributes are Bitcoin and Ethereum. At the same time in the crypto world, there are copy-cats coins that have brought nothing new to the crypto space; such coins are community-driven with the highest financial risk. A few of the crypto coins belonging to this category are the Mona coin, Shiba Inu, Dogecoin, Doggy, Dogelon Mars, Safemoon, Samoyedcoin and many more. These coins are called “Meme coins.” Even though some of these coins have shown some level of growth in the past years, the highest financial risk is associated with meme coins.

How Do You Identify Crypto Coins To Avoid Buying?

New meme coins are being launched as days pass by, quite a lot of investors of these meme coins are hoping to display related success recorded by Shiba Inu and Doge coins of which their efforts so far have been in futility, embarking on research in the following will so much prevent your wallet from liquidation.

  • Number of Coin Holder

According to experts in the crypto space, any token worth buying should have between 200 to 300 holders, with at least 10 transactions per minute.

  • Liquidation Pool

Any crypto project with defined, specific and clear goals should possess a minimum of $30,000 liquidity pool. Any figure lower than this is a clear sign that the project may liquidate your wallet as the liquidity pool is considered the backbone of any crypto project.

  • The Project’s Developer

The reputation of cryptocurrency developers speaks a lot about the project, developers of a crypto coin should be trusted, and in the case where a project has doxxed developers, such projects usually do possess some level of trust and hence, be advisable for investors.

  • The Authenticity of  Every Aspect of the Project

All aspects that publicized what the project represents should be original; aspects such as the website, the whitepaper should be unique and have no similarity with those in existence.

  • Functional Definition and Project Promises

When a cryptocurrency is launched with specific, defined, and clear goals, the route to which such goals will pass before it becomes a reality is vital in the choice of investment in such a project; some project’s goals are not realistic.

Risks Associated With Meme Coins

Meme coins are highly volatile, this volatility leads to pump and dump, and they have a high tendency to crash whenever the community decides to move on. Therefore, their life-cycle is generally short.

However, the tokenomics of meme coins can be very concerning as most of them are inflationary (coins with no limited supply), Bitcoin, for instance, has limited supply (deflationary), has its blockchain, a well-written whitepaper, and a clearly established ecosystem, meme coins lack these attributes, some exceptions are Shib technology which is built on  Ethereum and DOGE from Lite coin.

Furthermore, there are some cases where we experience growth in meme coins and some other projects will take advantage of it. Projects like that usually appear to get traders defrauded; such case was experienced by many traders with SQUID token which surged over 86,000% within a week of which the developers later rug-pulled, leading to a 99% crash in the token’s price, in fact, the holders were not allowed to sell their token. Therefore, it is always advisable to DYOR before investing in any project to prevent your wallet from liquidation.

Do you want a guide from experts?

Referencing a quote from a famous investor, “the first rule of investment is never to lose money, and the second rule is not to forget the first rule,” of all challenges in the crypto space, one of the biggest is embarking on great research before buying any cryptocurrency, meticulous investors do attempt to carry out both the technical and the fundamental analysis of crypto coins before they buy it.

However, it might have crossed your thoughts to buy or invest in cryptocurrency but your time for research is limited or you are encountering challenges both in technical and fundamental aspects of crypto analysis; MycryptoParadise is an excellent platform you can get your daily trading signals, we will provide you with the education and information that will guide your choice of buying any cryptocurrency and of course, grow your wallet beyond expectations.

We analyze dozens of crypto coins per day and the documentation of their history will improve your confidence towards buying cryptocurrencies with a good running project.

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