How not to choose "bad tomatoes" at the vegetable market/how not to buy an asset that will crash to the bottom
🖱A thought arises:
- "How are the crypto market and Ashot's spot in the neighborhood connected?"
- "very simple)"
In simple terms, the crypto market is an unregulated space where everyone does what they want (a good example is meme coins)
And therefore, everyone must clearly understand what and for what reasons to buy; otherwise, everyone risks losing their money. My goal is to explain to you how not to buy low-quality products at an inflated price when juicy tomatoes are available at a lower price)
🖱To avoid buying bad tomatoes at an inflated price, your action algorithm should look like this:
1) You saw a "promising altcoin" on the internet or from your favorite crypto blogger, which is about to give 1000%;
2) You dive into CoinMarketCap and see which funds have invested in our project. Funds you should pay attention to: a16z, Pantera Capital, Digital Currency Group, etc. Important: do not look at Binance Labs; they throw money into everything they can reach;
3) if someone among your "promising altcoin" has invested in it, that's a good sign and you can confidently look further;
4) Go online and look at everything about the project: the roadmap, white paper, why and for what purpose this project was created, what its goal is, how feasible it is, whether there are more successful analogs, who the development team is, and so on;
5) After gathering a base of information that we have analyzed, the most important stage comes - asking yourself a couple of vital questions. "Why should the token price rise?" "How will this project benefit the world?"
If you get answers to these questions like "because", I advise you to stop analyzing this project 😉
But, if your answers are:
1. This is a promising blockchain, the likes of which do not yet exist, and it can be useful in real life for every person;
2. If this project is about to release a major update according to the roadmap that will interest many people and provide some benefit to the world, then you can confidently move forward)
6) Here we are already at the finish line; at this stage, we define areas of interest for buying/selling, for example:
Bought for 3, selling for 20 (The next posts will be dedicated to the topic: how to define an area of interest, as this is a global topic that requires covering many aspects)
In short: without a clear adherence to areas of interest, you risk catching FOMO and losing everything because you will either sell too early or too late. To avoid this, use areas of interest. Also, immediately determine what percentage of your deposit you should invest in it, and later, when it dips, buy more, for example:
Bought with 10% of the deposit; if there's a 50% dip from the purchase price, you can allocate another 5-10% of the deposit for buying (only if the project is still afloat and the dip is due to a local market phase, or the project will survive stagnation, but there is full confidence that they will be fine)
🖱If you strictly follow these points, the risk of losing money by purchasing incorrect assets and foolishly shouting "crypto is a scam" will approach zero 😎
All the best
