How to Spot a Shitcoin

in #cryptocurrency6 years ago

I want to outline a few tips on how to spot if a coin is a "shitcoin". Please note that there are exceptions to every one of these rules and I am not referring to any specific coins. Also these rules aren't in any particular order. Also, most of these rules are for long term holds, it's possible to make money on nearly anything in the short term if you buy and sell at the right time.

  1. The coin is a shitcoin if the team promises things they can't keep. If a team says that you're guaranteed to make money- all in all, that is simply false. It's impossible to guarantee anything- especially in this market.

  2. If the team is anonymous, and it is a normal project (I understand many privacy coins have anonymous teams and that's sometimes ok) it is fishy. There is no reason for any team to be private if they're doing a regular project unless they want to hide something.

  3. No whitepaper or working product: An idea may be great, it may be revolutionary, but with no whitepaper or working product or patent at the least it's useless. The bigger the idea, the harder it is to accomplish.

  4. Generally, it isn't good when a coin claims it is a disruptor. Unless the coin is a giant project, with a large team, a product, etc... being a disruptor isn't necessarily a good thing. This buzz word implies that they are trying to replace huge company behind it, and it is foolish to think a coin with a team of a few people with no product can beat out a google or a yahoo. In general, it is a better investment if they are trying to work around technology or build on it.

  5. With time, comes change: If a project has a road map multiple years out, it is very possible that by the time they reach that point, the product is already produced elsewhere.

  6. Don't be fooled by a big team of advisors. Many advisors are simply there for the name and because they get paid a lot- look into the product and don't blindly follow names.

  7. Ignore corrupt ICO's: Many ICOs I see have the team getting 30% or 40% and claim that they're decentralized- that is usually false.

  8. Don't be fooled by coins with low prices that people say are steals with high market caps. A coin with a 10 billion dollar market cap can be 10 cents and a coin with a 1 million market cap can be 10 dollars.

  9. The team isn't on linkedin and little is known about them: There's simply no reason not to be on linkedin or give info about the team unless there is something to hide.

  10. Don't rely on teams making improvements: If a team is bad in marketing and have a good product, that doesn't mean they will grow and become mainstream- marketing specifically is one of the most important aspects (If not the most important aspect) in becoming mainstream.

  11. Stay away from projects that aren't on social media: If a project wants to be the next big thing and doesn't even bother to have a social media page, then stay far away.

  12. Be careful with team/investor shilling: A certain amount of hype can be a good thing, but too much hype can be bad. This can lead to the company being audited, investigated, and overvalued.

  13. If you don't know what the website is after reading the website's pages- then don't invest in it. If the common person can't understand their product, that is likely a problem (Unless they're targeting a specific base, which can also be an issue)

14- Don't worry about the project starting off small. It is actually healthy to start off small and grow big. Look at facebook, they started off with the harvard connection, which was localized, and grew into the biggest social networks in the world.

15- Don't ignore small projects. There are projects out there with a 10 million dollar cap that have as much potential as one with 100 million dollar cap. Low cap doesn't mean bad product.

16- If there is a lot of competition in the market, make sure they mention it on their site/white paper. If a project is similar to another project in a similar position and they don't compare their products on their whitepaper, it may not be a good product.

17- Take note of the name. When people check up the project, it's not a good look when they're on the bottom of the page on a google search. This is very important in regards to mainstream adoption.

18- Look for details in a whitepaper- If the whitepaper just explains what blockchain and bitcoin are, then it is likely fishy. Look for specific details.

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You know your stuff. I think you could be huge here on Steemit. Would recommend posting an image with each post, even something simple, to get the attention you deserve. Best of luck. Will be following and looking forward to more tips.

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