Would you like to find crypto gems before anyone else?

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A couple of months ago we posted an article about finding newly launched crypto tokens with big upside potential. We were pleased by the huge interest manifested by our readers on this matter and we want to respond in this article to those who asked for a more beginner friendly approach.

For those who aren’t accustomed to the term “gem finding”, let me put it in simpler words; imagine blockchain as being a cave in which you find a lot of worthless stones (tokens in our situation) and, from time to time, gems (tokens that can grow more than 100x). Every single day, there are thousands of tokens that get released, mostly on Ethereum Blockchain and Binance Smart Chain. More than 99.9% are trash, bad developed tokens that lack purpose and a strong development team or even worse, tokens designed by impostors to scam you out of your money (you can find more about them in this article) but rarely you will find projects that can easily surpass 100x ROI.

If you are willing to take the risk, which is quite high and you don’t want to waste time on coding or you don’t have the technical knowledge required there is great news, you can use some free tools to greatly increase your odds.

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The first step of the process is to discover new tokens that are available for trading on decentralized exchanges. When submitting a new pair for trading on a DEX, the developers invoke a method usually defined in the Factory smart contract of that DEX. The method expects two tokens, A and B. If we use a blockchain explorer and look at transactions that invoke that method, we will find pairs of tokens that already exists but weren’t traded under that pair which aren’t interesting for us. What we are looking for are the transactions that invoke the creation of a pair consisting of a new token and a popular coin (e.g. ETH, BNB, etc.).

The factory contract address for Uniswap V2 can be observed on Etherscan.

As you can see in the above screenshot, almost all transactions invoke the “Create Pair” method (second column). If we click on any transaction’s address and expand its details by clicking the “Click to see More” button, we can see the input data.

In this example transaction, which was randomly selected from the list we observe two token addresses that have some leading zeros, if we delete them and search the addresses on etherscan.io we can see the tokens that form the pair. In this particular example, the pair was formed from IDTT which was deployed 3 days before we wrote this section and WETH (wrapped ETH) which is a popular ERC20 token representation of Ethereum.

If you would like to search for gems that are traded on other DEXs, you can follow the same steps but use the appropriate factory address.

1. Uniswap V2 Factory: 0x5C69bEe701ef814a2B6a3EDD4B1652CB9cc5aA6f
2. Uniswap V3 Factory:
   0x1f98431c8ad98523631ae4a59f267346ea31f984
3. PancakeSwap V2 Factory:
   0xcA143Ce32Fe78f1f7019d7d551a6402fC5350c73 (you will need to use a BSC explorer)

After you identify a possible gem you need to focus on the more complex task of risk assessment. Mudra has a free tool (Research) that provides some useful information which can be coupled with DexTools and PooCoin.

Betting on crypto gems, as the name implies, is pure gamble, you won’t find the next Bitcoin or Ethereum using such a technique, but that doesn’t mean you won’t find profitable bets; consider it as being a sport, something in which you find pleasure, but don’t risk your life savings on it, don’t consider it as being a sustainable source of income or prudent investment.

If you’re still willing to bet on the newly discovered crypto gem, you should at least verify the following:

1. There is a considerable amount of liquidity locked for at least a few months.
2. You can find a website or other media presence containing the address the the gem’s contract.
3. Make sure that there aren’t suspicious token burns. (in this article we discuss why tokens are burnt for malicious purposes).
4. Check if there are any sells or if you can buy and sell small amount of tokens. (in this article we present a technique used by scammers that restricts token sell-of).
5. If the token is mint-able and the development team isn’t well known or reputable you should probably pass on this bet.
6. Take your time to read all information published on their website and look for typos and spelling errors.
7. Check the number of holders, its evolution over a couple of days and the percentage of their holdings from the circulating supply.

Good luck and remember that this article is meant to teach you how to increase your odds of success if you already decided to try finding gems and to speculate on their value gain. The information stated above isn’t intended to incentivize the acquisition of any crypto asset and shouldn’t be considered financial advice.

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