What to look for in a booming crypto
When evaluating a booming crypto, start with its real-world utility. Consider its uses and the problems it aims to solve. A good place to find this information is in the cryptocurrency's white paper, which should be on its website. Here are a few more important items you can use to evaluate a cryptocurrency:
- Leadership: Check who's behind the project, their qualifications, and their experience.
- Notable attributes: Anything that makes a cryptocurrency stand out from the competition, such as Bittensor's open-source AI network or Solana's speed.
- Total value locked (TVL): For blockchains with smart contract capabilities, TVL shows you how much value is on a blockchain. It's a good measure of which blockchains people are using.
- Number of users: This metric indicates a blockchain's popularity.
There's no guarantee that a booming cryptocurrency will maintain its momentum. But those factors can help you determine whether a cryptocurrency has genuine value or is merely designed to enrich its developers.
Where to find the next crypto to boom?
CoinMarketCap and CoinGecko are both good starting points to find cryptocurrencies that could explode. You can use them to look up trending coins, recent winners, and new cryptocurrencies. They also offer a variety of filters, including market cap, trading volume, and category.
Social media, particularly the crypto communities on Reddit and X, can be useful for learning about new investment opportunities. However, it's also full of scams, so it's important to do your own research on any social media recommendations that you're considering.
When you're ready to evaluate cryptocurrencies, on-chain analytics tools can help. Two of the more popular options are Dune Analytics and DefiLlama. You can use the tools to check metrics for a cryptocurrency, such as the number of users and transaction volume on its blockchain.