How to choose a high-quality digital currency and judge its value
Friends who have just entered the currency circle, facing hundreds of currencies, how to choose and accurately find the currency with investment value? In the embodiment of the value of the digital currency, there are many properties that need to be referred to. The following are a few This aspect tells you how to choose a high-quality currency.
ǀ. How to identify a good currency:
1. Basic currency information:
The total amount of coins, the ranking of the circulating market value, the highest and lowest prices in history, the ups and downs, the trading volume, etc. Query tool:
①Coinmarketcap: Website: www.coinmarketcap.com
② Feixiaohao: Website: https://www.feixiaohao.com/
③Mytoken: URL: http://mytoken.io/
2. Look at the project white paper:
The best way to understand a certain currency is to read the white paper of the currency. From the white paper, you can know the issuance mechanism of the currency, the distribution of rights and interests, its function, the total amount of tokens, the lock-up period, and whether there is additional issuance. , long-term planning. As well as the founder, founding team, investor background, etc. Judge the quality of a currency through the white paper. A more reasonable position is that the internal net holding amount of project personnel should be less than 25%
How to understand the white paper of the blockchain project — Programmer Sought
3. Whether it has been listed on mainstream exchanges and whether it can be transferred to mainstream digital currency wallets:
Whether the currency can be found in mainstream exchanges, and the currency of mainstream exchanges can be omitted because the exchange will verify it. Some MLM coins, air coins, and junk coins will only circulate in the trading platform built by themselves.
When some coins are unheard and unseen, go to mainstream exchanges to check. If this coin is not in any major exchange, it must not be a good coin. In the circle, we have more industry news than our ordinary retail investors, and can better judge which coins are junk coins and which coins can survive the bull market. Blessed.
4. Community construction and maintenance:
The so-called community refers to the fan group of a certain currency and the official establishment, including Twitter, official account, WeChat group, telegram group, etc. The higher the number of fans, the higher the activity. A team that is really working will have managers in the community to deal with some problems at any time and to promote and maintain.
5. Open source code and code updates:
Open source code is the technical basis for the generation of digital currency. One of the bases for judging the technical level of a currency. Check the update frequency of the currency code to have a basic judgment on the work results of the team’s technical staff. If the code is not updated for a long time, it means that the project party has not put any effort into the development of the token. Publish open source code: A real digital currency, such as Bitcoin, publishes open-source code at the same time as it is released.
6. Related news:
The latest news and whether there is any negative news, etc., industry news and official information should be generally understood, because some news will cause the currency price to rise or fall.
In addition to the above simple basic judgments, we also need to judge the value of a currency.
ǁ. How to judge the value of digital currency:
All the value comes from people’s consensus, that is, the expected value of the goods. For example, the diamond itself has little value, but through the promotion and interpretation of the jeweler, it is packaged as a symbol of eternal love to keep attracting people and generating consensus, so it has great value.
So what is the society’s view on the application prospects of a certain currency, the human and social development that does not conform to it, what is everyone’s expectation and confidence in it? Responding to the situation can last for a long time, and taking the situation can go far. Only in line with the trend can it develop steadily.
Popularity is also a huge value. Only when the public accepts and recognizes it is an industry or project that make great progress. Therefore, the value of popularity and everyone’s expectations are immeasurable. From this point of view, those digital currencies with high popularity in China have a good prospect.
For example, there is a consensus of believers behind Bitcoin. This consensus is the most valuable. If this consensus does not disappear in a day, it means that it will always have value and will always exist, coupled with the scarcity of its own quantity. The market value of the digital currency represented by Bitcoin is getting higher and higher, because more and more people believe and recognize it, and more and more people are using it and participating in it. This is an irreversible process.
In the future, we may not need to go through banks or other intermediaries to directly transfer the value in our hands to another person, such as digital currency, personal creation, etc.
2. The meaning of existence:
What is the meaning of a currency itself? Has there been a real solution to social practical problems, and can it really be implemented? Is there a need to use blockchain technology? The so-called air currency has no meaning, and it cannot be landed but exists only for misappropriation.
For example, Bitcoin, which created a historical precedent, removed centralization and realized peer-to-peer payment, which is its own intrinsic value. Part of that value is that it does solve some problems. The emergence of Bitcoin marks the birth of its underlying technology, the blockchain.
The concept of blockchain has been accepted by most countries, and blockchain can solve the problem of mistrust between current centralized systems and can be used in value transmission, patent fields, and financial fields. It can also realize the construction of traceability and integrity system.
3. Globalization of liquidity and payment:
The liquidity of digital currency is a test of the value of the digital currency. It is the key to the maturity of the digital currency market. The digital currency used in the payment field will reflect the value to a higher level. For example, digital currencies such as Bitcoin, Ripple, and Radar have their own payment systems. Microsoft, Dell, and Steam have opened Bitcoin payment channels. Many merchants also accept payments in Bitcoin or other digital currencies. The circulation of digital currency is not only the mutual transfer between investors on the trading platform. The value of digital currency lies in the application of digital currency, and its applications will become more and more with the development of the Internet, and opportunities and markets will also appear in it.
Based on the above judgment basis, some high-quality coins can basically be screened out. Among these thousands of coins, many coins are speculative and have no real value. Therefore, we must know how to analyze and understand its value in order to invest better.