When we select a stock for investment, we ensure that it is the stock that is holding the company's value and that it is performing well. We examine the company's balance sheet, including how much profit is being made and how much income is being created, as well as sales and their intrinsic value.
Before investing in any stock, we conduct thorough fundamental research. Before you invest in cryptocurrencies, there are a few things you should look at. This post will explain how to determine whether a cryptocurrency is fundamentally robust or not. Stocks have an underlining business that is dependent on their performance.
In the case of cryptocurrency, the price fluctuates due to hype, news, and events, as well as demand and supply. This is what I'm going to talk about today. To learn about cryptocurrencies, go to their website and learn about who they are and what they do. Will learn more about his team, including who founded it, how many members are well-known, and how much experience they have in the crypto sector.
The greater the market capitalization of a cryptocurrency, the more secure it is for us. Although there is still a danger, the more money invested in a cryptocurrency, the bigger the market capitalization, the less volatile the coin becomes.
Following that, we'll look at who has invested in that coin, as well as who has partnered with that cryptocurrency project. Many governments have also experimented with cryptos. You'll also be able to see which wallet has been held.
It's not as if only two or three wallets have held As with Dogecoin, which is held by those wallets in some form. The price of a cryptocurrency will fluctuate as soon as you sell or buy it. You also read the white paper in addition to this. Everything regarding cryptocurrency will be detailed in a white paper on their website. If you have a white paper, you will have more clarity on who they are and what you want to do.
Along with this, you check the supply; the lower the supply, the higher the price; as a result, those who have a large supply, such as 1 billion or 500 million, begin burning their cryptocurrencies in order to reduce the supply and raise the price.
If there is a cryptocurrency craze, you should investigate why it was created, what is the use case, and what problem it is solving before investing in any cryptocurrency.
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Bitcoin
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| pic credit: Google Images|mint |
Over 12000 cryptocurrencies have been developed so far, with a market capitalization of $3 trillion. Bitcoin is the most popular cryptocurrency among these. Bitcoin was the first and largest cryptocurrency, with a market capitalization of $929 billion USD. Bitcoin, which is used for both payment and investment, has attracted a large amount of investment.
Now, our initial payment system, cash, had numerous faults, such as its control, which was in the hands of both the bank and the government. As a result, it does not remain in the hands of the control bank or any third party, and this cryptocurrency, known as bitcoin, was founded on the basis of decentralization.
It has also been accepted as legal money in one country. It is now being reported that Brazil is working on a law that will allow it to accept bitcoin as legal tender. Apart from that, because of its large market capitalization, bitcoin is the most valuable cryptocurrency; as a result, if bitcoin rises, so does the value of other cryptocurrencies; conversely, if bitcoin falls, so does the value of other cryptocurrencies.
It was founded in the aftermath of the 2008 financial crisis with the goal of decentralizing the financial world so that banks and governments do not have control over it.
Ethereum
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| pic credit: forbes.com |
With a market capitalization of $399 billion, Ethereum is the second-largest cryptocurrency. Ethereum is a platform that allows you to create your own blockchain and decentralized application. More than 280,000 coins have been created using Ethereum's technology, and many cryptocurrencies are built on Ethereum's platform.
Ethereum's goal is to make the Internet more decentralized. You can construct your own application, banking, NEFT, gambling, and decentralize all industries by using Ethereum's blockchain.
Ethereum also has certain flaws, such as its slowness (15 transactions per second vs. 7 transactions per second for bitcoin), and the fact that there are too many Ethereum rivals on the way. Ethereum's gas expenses are also quite hefty.
As a result, developers are looking for Ethereum alternatives. Ethereum has certain scaling difficulties as well.
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Solana
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| pic credit: google images|economictimes |
Solana is a new cryptocurrency that was launched in 2020 solely to address Ethereum's scalability, speed, and excessive fees. It is also rapidly expanding, with a transaction pace of 65000 transactions per second. It's also inexpensive, and it solves scaling difficulties.
There are currently a variety of blockchains to choose from. So many intelligent chains have been created. Many businesses are developing their own blockchains and initiatives, and a crypto project is currently in development to link them all together.
Polkadot
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Polka dot is a multichain protocol that allows data to be transferred between chains. Polkadot is also investigating the prospect of transferring public and private data. You can construct applications on the polka dot, which was started only by Ethereum's founders. In addition, it solves Ethereum's scalability problem.
ChainLink
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| pic credit: coinmarket cap |
Chainlink is also solving a real-world problem at what number. That's why I bought it, and it's also given the industry a monopoly. Friends, here is the blockchain, which is the cryptocurrency and the mechanism that provides real-world data to the other coins.
For data storage, more than half of blockchain coins use outmoded technologies. Old data that is real-world data must be transferred to the blockchain. So, how does Chainlink operate, and where does that information originate from? Only coders like you and me bring the correct information, and we are rewarded with Chainlink.
Who can supply information on Chainlink to individuals who have an interest in it? Stakeholders who have invested in the chain link can serve as validators. The same validators also provide the correct data.
Then, in the real world, Chainlink provides the same correct information to all of the other cryptocurrencies. Chainlink serves the majority of the world's cryptocurrencies by delivering real-time data. And I chose Chainlink because of the distinctive nature of their work.
There aren't many other cryptocurrencies that do this, and they've effectively formed a monopoly in their field by connecting the blockchain to the real world.
Disclaimer: This article is not intended to persuade you to buy any of the cryptocurrencies or to invest in any way. This is merely an amateur's opinion, not that of a financial advisor. We recommend speaking with your financial advisor and conducting your own research before investing in cryptocurrency.
That too, leading business personnel who are much ecstatic about developing their own cryptocurrency exchange platform are in continuous search to find a platform for such development. cryptocurrency exchange
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