Using Real Data to Find the Next Big Cryptocurrency
Cryptocurrency investors are on a never-ending search for the next coin sitting on the launchpad, ready for lift-off to the moon. Even with plenty of misses, an investor only needs one so-called moonshot to wipe out all of their losses and take them up and over into the black.
Just exactly how cryptocurrency investors find the next project to stack their chips on is, however, a delicate process that varies greatly from one investor to the next. Some choose to spend all of their available time scouring forums such as Reddit and Bitcointalk for sentiment, while others trawl across Twitter feeds and Telegram groups. Still, others arm themselves with nothing more than charts, relying on their own technical analysis interpretations to guide their trades and catch the next big wave.
Is there a right or wrong way? Well, it depends on who you ask, but many of the aforementioned methods are extremely subjective indicators that rely too heavily on oneʼs own emotional interpretation. Upon reading forum opinions and finding agreeable ones, many traders find their own biases confirmed and conveniently blind out opposing views, creating an imbalance in their approach.
Rather than relying on such sentimental opinion, wouldnʼt it be wiser to back trading decisions with empirical evidence? Sources for such evidence are few and far between, but a budding startup cryptocurrency rating site called CoinShakeDown is aiming to change the way traders gather their facts.
Data-backed Cryptocurrency Rankings
CoinShakeDown presents users with a proprietary algorithm-powered ranking engine that lists coins based on four qualities. These qualities are scarcity, longevity, development and social.
The CoinShakeDown team determined these four qualities to be critical when determining the maturity, value, and likelihood of future success for a given cryptocurrency.
Each of the four chosen categories is key in any investorʼs assessment of a cryptocurrency project, and there are compelling reasons for why:
Development: Perhaps the most important consideration of all. The development ranking refers to how active a coinʼs technical development is. This is determined using GitHub activity and by checking into development communities in places like Discord. Bitcoin does really well in this area because its project houses the most critically acclaimed developers in the world.
Social: No investment research is complete without checking in on social buzz. Twitter, Facebook, Reddit, Discord, Telegram: All of the activity for a given cryptocurrency amongst these various channels is factored in by the CoinShakeDown algorithm before determining a ranking. Ethereum does well here with their aggressive focus on building a strong developer community and having public facing representatives for users to build rapport with.
Scarcity: This quality refers to the supply amount of a given cryptocurrency asset. The lesser the supply, the more scarce the asset. The economics of this work brilliantly when a coin has a low supply and high demand, driving its scarcity through the roof. Bitcoin is a prime example of this scenario. Interestingly enough… has anyone even heard of 42 coin?
Longevity: Refers to the amount of time a given cryptocurrency asset has been in the market. Considering longevity allows an
investor to determine how well an asset has weathered the volatile cryptocurrency market. Some cryptocurrencies show up and disappear in the blink of an eye while others, such as Bitcoin, have been around for ages and have deeply rooted themselves in the market.
Overall: This section of the site covers the cumulative scores of the current grading categories (development, scarcity, longevity and social). The scores presented here are really important as they will show cryptocurrencies with iron-man traits that perform well in multiple areas towards the top.
Whats Next?
The CoinShakeDown team is planning to implement additional grading categories to their current list. Categories like security and blockchain performance are ones to watch out for. Also the site currently does not rate ICO tokens due to differences from actual cryptocurrencies but they have plans to add this feature by end of CY2018.
Stay a Step Ahead with CoinShakeDown
By following up with CoinShakeDownʼs regularly updated, dynamic ranking system, investors have an easy and surefire way to see cold, hard analytics to back their trading decisions.
*** The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice
