In this article, we will learn how to make a successful Altcoin basket consisting of many cryptocurrencies.
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Introduction
In the time period from the invention of Bitcoin to the present day, the"Cryptocurrency Market" has changed and evolved in many ways. The cryptocurrency market currently has more than 500 cryptocurrency exchanges, more than 20,000 cryptocurrencies, and a market volume of close to 4 trillion dollars.
Cryptocurrency investors are almost lost in so many cryptocurrencies. Since there is no central system in the world that controls cryptocurrencies, the number of cryptocurrencies is increasing like mushrooms. This means that there are thousands of cryptocurrencies that we call fake (scam) floating around. Questions that bother people who are thinking of investing in cryptocurrencies; How do I find solid Altcoin projects? How can I understand fake (scam) Altcoin projects? How do I create a nice Altcoin basket that can bring profit? These and similar questions consist of these.
In this article, we will try to explain how to make a nice "Altcoin Basket".
What is an Altcoin Basket?
The cryptocurrency market is a highly variable market, meaning a volatile market. Investment instruments with high volatility carry high risks as well as high profits. While some investors realize their high profits, most close their transactions with losses.
In order to reduce the risk in investment instruments where so many variables come together, it is necessary to distribute the risk. When creating an investment basket consisting of cryptocurrencies, an investment portfolio is created with major Altcoin projects (Ethereum, Binance Coin, Tron, Cardano etc.) and minor Altcoin (PEPE etc.) projects next to Bitcoin. This is called "Altcoin Basket".
What are the Sources to be Used When Creating an Altcoin Basket?
Gathering Sources and Information
The first step in creating an altcoin basket is to determine a source. You will create a basket. The first thing you need to do is to examine the sites that collect cryptocurrency data on the internet to access the information about the altcoins in the basket you will create. The information of these sites should always be at your fingertips and you should save it in your archive. In this way, you can collect sources and information about the basket you will create.
The resource sites I can recommend to you on this subject are: 1-) CoinMarketCap, 2-) CoinGecko websites. You can find most of the information you are looking for regarding basic information on these resource sites. I am leaving the links below for you to access.
{getButton} $text={CoinMarketCap} $icon={link} $color={#00008B}
{getButton} $text={CoinGecko} $icon={link} $color={#00008B}
Basic and Technical Information
I explained the places where you can collect resources and information above. Now, let's explain what is Basic and Technical Information or Basic and Technical Data.
"Basic Information" refers to the basic information of an Altcoin project. For example: Website, technical article, source code, maximum supply, etc. You can obtain this information from the source sites above.
Another very important point is that you need to follow the basic market news about the Altcoin you want to add to your basket. Maybe very negative news, for example; If you read the news that a coin in your Altcoin basket will be delisted, you will save yourself from the loss. Or, you can wait with good news and multiply your profit.
"Technical Information" refers to the technical analysis data about the Altcoin that you are considering adding to your cart. For example; Fibonacci support and resistance levels, what certain indicators and indicators say in the short and long term, etc. In order to obtain this information, you must know technical analysis. You will learn the basic lessons and learn a little technical analysis, or you need to get help from a technical analysis expert.
I want to emphasize this point here: You can create a basket with just basic knowledge, but if you add technical knowledge, you will create a more robust basket.{alertSuccess}
What Does It Mean to Be Delisted?
Delisted is the removal of a coin listed on a cryptocurrency exchange. In other words, the delisted coin is removed from the exchange board. It is likened to the "delisting" event in stock exchanges that we know. Investors may face big losses due to delisted cryptocurrencies.
How to Make an Altcoin Basket? Step by Step Explanation
Now I will try to explain to you step by step how to create an Altcoin basket. You can create an Altcoin Basket as you wish, depending on the risk-reward ratio you will earn.
Investors who do not like risk much keep a large amount of Bitcoin and Ethereum in their baskets and choose other projects in the basket from Major Altcoins.
Investors who like risk create a basket from Minor Altcoins, which are not very well-known or not listed on many cryptocurrency exchanges.
Investors who like medium-level risk create a mixed basket. They prepare a basket consisting of Bitcoin, Ethereum, major Altcoins and minor Altcoins.
As I explained in the paragraphs above, to start creating a basket, you should follow the order of Basic analysis first, then Technical analysis. Now, let's move on to the details and see what we need to do step by step when creating an Altcoin Basket.
I will try to explain the following steps in a clear way with examples. As an example, I will use the data from the CoinMarketCap website and examine the Aave (AAVE) Altcoin. AAVE is currently ranked 33rd.
Step 1: Check out the Altcoin Project Website
In the first step, we enter the website of the Altcoin we want to add to our cart. Let's examine the AAVE website as an example. A quality project's website will also be quality. Examine sections such as website design, texts, and diagrams. Websites with bad design are obvious.
Is there a "lock" icon (https) in the upper left corner of the website? If not, that site is a dangerous and bad site and here is the biggest reason for you to avoid that project. If there is, click on the lock icon and examine the certificate information. Is the certificate period short? Who issued the certificate? For example, a website with a security certificate of 1 month may raise suspicion in people's minds, be careful. Who issued it is also very important. For example, Google Trust Services LLC certificates are solid certificates.
In addition to this information, the website's contact information, project partners and information, blog posts, coin distribution information, etc. It is necessary to examine the basic information. Projects with solid partners are solid. An Altcoin project that constantly informs its investors and project supporters with Blog posts can be a solid project candidate.
Step 2: Altcoin Total Supply, Maximum Supply and Controlling Them
The supply of a coin, that is, the number of coins released into the market, is very important. The maximum supply of Bitcoin is 21 million. This means that no more Bitcoins can be produced or printed. This makes Bitcoin valuable.
A coin with an unlimited maximum supply means that it can be printed in the future, that is, its number can be increased. In the LUNA incident in August 2022, the maximum supply of LUNA, which had a total supply of 1 billion, was unlimited. In order for the UST coin, an algorithmic stable coin tied to LUNA, to remain at $ 1, 7 trillion LUNAs were printed. Imagine the LUNA coin, which was 1 billion, to increase to 7 trillion. The coin, which lost value incredibly, eventually entered a death spiral and victimized and harmed hundreds of thousands of people. Forget Futures, even investors in Spot markets have become liquid.
What you need to understand from this example is that projects with a limited maximum supply should be your priority. Of course, we can't say that projects with an infinite maximum supply are bad, but it is useful to be cautious.
The Maximum Supply of the AAVE coin in our example: 16 million units. Total Supply: 16 million units. This means that more than 16 million AAVE coins cannot be printed. In other words, there is a limit.
Another thing we need to pay attention to is whether the "Circulating Supply" data is confirmed? If this data is not confirmed, I think it is useful to pay attention.
When we look at this data for the AAVE coin, it is seen that "Verified Data: The CoinMarketCap team confirmed the circulating supply of the project as follows" . This means that there is no problem.
Check the maximum supply, total supply, etc. of the coin you are looking at on the CoinMarketCap website. The data in this section must match the CoinMarketCap data.
Step 3: The Power of Altcoins on Social Media Platforms
Today, social media platforms are very important in terms of interaction and information sharing on many issues. An Altcoin's activity and information sharing on social media platforms can mean that the project team cares about its work and is in interaction.
For example, it would be useful to look at the number of followers, daily shared tweets and retweets, etc. of the Altcoin you are examining on the Twitter social media platform. An inactive account that does not share raises suspicion and can be deduced that it should be avoided.
One of the most important things is Is the Twitter account verified? Verified accounts always provide trust and are one step ahead of other accounts.
When we look at the AAVE coin Twitter account: It is seen that the account is verified, has 641 thousand followers and tweets are shared frequently. Likewise, you can also check the social platforms of the Altcoin you are examining such as Reddit, Bitcointalk, Medium, Telegram etc.
Step 4: Importance of Source Code and Technical Article
Each coin is built on certain codes. In order to follow the developments on the altcoin, the "Source Code" section should be examined. Source code entries are usually made through the Github website. If the altcoin you are examining is frequently being worked on, this is a positive thing.
If there is a coin without a source code or not specified, it is necessary to be careful and approach cautiously.
When we examine the AAVE coin, we see that the source code work is frequent and continuous. It means that the interest and concern for the project is high.
Technical Article is information data, usually created in pdf format, that expresses what the project of a coin is, its operation and working style.
The writing style, narration and content of the technical article are very important. The text must be written in accordance with the existing categories and subcategories of the coin you are reviewing. A meaningless or random text does not express a good unity of meaning and will cause you to lose confidence during the review.
When we look at the technical article of AAVE coin, we see that the presentation and content are rich and high quality, mathematical data and formulas are shared. Information is given as of the current category, and information such as how the operation and studies are done are clearly understood.
It is useful to pay attention when you examine a coin without a Technical Article.
Remember! A project without a technical article is like a car without a steering wheel. {alertWarning}
Step 5: Labels and Controls on Altcoins
There are Altcoin projects in many categories such as Mineable, DeFi, NFT, Metaverse, Play To Earn, VR/AR, Smart Contracts, web 3.0 etc. It is very important which category or categories the Altcoin you are examining is in. Sometimes some categories may be trending. This can result in high earnings.
We see that AAVE coin is in the DeFi category. In addition, it has subcategories such as DAO, Yield Farming, Lending, Borrowing.
What we call auditing is the examination and scoring of Altcoins by 3rd party sites, primarily in terms of security. Some of these sites are; CertiK, Fairyproof etc. If the Altcoins you are examining have been audited, it is positive. After all, it means that they have passed some security audits. It would be logically useful to be cautious about Altcoins that do not have an audit.
When we look at the AAVE coin, we see that it passed the CERTIK audit and received 95 points out of 100.
Step 6: Cryptocurrency Exchanges Where the Altcoin is Listed and the Importance of Volume
One of the most important things is to look at which exchanges the Altcoins we are examining are listed on. The more cryptocurrency exchanges a coin is listed on, the more volume it will have. Volume means money inflow.
One of the important things here is that the listed exchanges are quality. Especially Binance, Coinbase, KuCoin, MEXC, HTX, Bybit, Bitget, Gate.io etc., large exchanges in terms of user and volume will attract more money inflow to the Altcoins listed. We can infer that Altcoins that are both listed on large exchanges and listed on a large number of exchanges are of high quality. In short, the more exchanges, the more money inflow.
When we look at the AAVE coin, we see that it is listed on 40+ cryptocurrency exchanges, including large exchanges.
Step 7: The Importance of More Information
Too much information is not enough. More information about the altcoin you are researching is always useful. Don't forget to research more information from the CoinMarketCap source site. To summarize the information you will research;
Holders
It refers to the number of wallets that hold the Altcoin you are reviewing. Especially for a cryptocurrency with a limited supply, the constantly increasing number of wallet addresses can be a positive sign.
Project Info
In this section, you can see the partner companies that support the Altcoin you are reviewing. The more solid partners an Altcoin has, the stronger it is. In the same section, you can also see the number of followers on the social media accounts of the Altcoin you are reviewing.
Wallets
In this section, you can see the types and numbers of wallets supported by Altcoins. We can store the Bitcoins and Altcoins we have purchased in 3 different places as Exchange account wallets, hot wallets and cold wallets.
For example, if you have a Binance exchange account wallet, you can withdraw your assets there, for example, your Bitcoins to "Trust Wallet" hot wallet or you can get a "LEDGER" cold wallet and store your Bitcoins at home.
Especially large investors prefer cold wallets. When we consider that many exchanges have been subject to hacking in the past, it is obvious how important this is.
The more cold and hot wallets the Altcoin you are examining supports, the stronger it will be.
Analysis and Ratings
In this section, you can access technical data about the cryptocurrency you are examining. This data, calculated by third-party organizations, allows you to access technical data about the Altcoin. The higher the technical data of the project, the more solid it can be considered.
Conclusion Your Altcoin Basket is Now Complete
When you apply the information we have explained in this article to the letter, you will now be able to create a successful "Altcoin Basket". Thank you for reading this article on our Referral Brotherhood blog site and wish you lots of earnings.
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