#TopCoinsSeptember2024 #dogs #btc #brett
The growing cryptocurrency market offers a wide range of altcoins, which can make it difficult to choose a promising investment. They all seem to promise astronomical returns, but how do you make an informed decision?
The key factor: diluted total supply
A key aspect to consider is the altcoin’s total diluted supply. This value represents the maximum amount of tokens that will ever exist. If the supply is already fully diluted, it means that all tokens have been issued and distributed.
Altcoins with fully diluted supply:
Greater growth potential: With no more tokens to be issued, demand can drive the price more significantly.Less selling pressure: The absence of new emissions reduces the constant selling pressure that a project can exert on the market.
Altcoins with non-fully diluted supply:
Increased volatility: The continuous issuance of new tokens may dilute existing investors' gains and lead to increased price volatility.Sell-off risk: Development teams may sell large amounts of tokens on the market, which could lead to significant price drops.
Other factors to consider:
While the total diluted supply is crucial, other factors can also influence the choice of an altcoin:
Use Case & Technology: Evaluate the utility of the cryptocurrency and the robustness of the underlying technology.Development Team: Research the experience and reputation of the team behind the project.Communities & Adoption: An active community and growing number of users can indicate further growth potential.Technical Analysis: Use tools and charts to identify patterns and trends in the altcoin's price.
The small-cap strategy with diluted supply
A popular strategy among investors is to look for small-cap altcoins with fully diluted supply. These cryptocurrencies are typically more volatile and can offer higher gains in a short period of time. However, they also carry higher risk.
What is this strategy based on?
Historically, we have seen small-cap altcoins with diluted supply experience strong rallies during bull markets. This is because, with a relatively low market cap, even small capital inflows can lead to large price movements.
Conclusion
Selecting a winning altcoin requires a combination of technical analysis, fundamental research, and risk management. By prioritizing altcoins with fully diluted supply and strong fundamentals, you can increase your chances of doing well in this dynamic and exciting market.
Please note: Investing in cryptocurrencies involves a high level of risk. Always conduct thorough research before making any decision and diversify your portfolio to minimize exposure to losses.
