Number 10: Top 10 Mistakes Crypto Newbies Make
Today begins a series aimed at helping those new to crypto many of the mistakes I've seen over the past two years. Know some people new to crypto? This should be helpful.
Assuming Listed Market Size Reflects Real Value
Coinmarketcap.com is a great general resource for any holder of cryptocurrency. It lists 1000 cryptocurrencies traded on exchanges such as Bittrex, Kraken, and Poloniex.
Because cryptocurrency is unregulated, there are many opportunities for market manipulation by dishonest traders. This results in coins with little to no use being “pumped” through manipulative techniques, bringing in momentum traders and wanna-bees, and eventually blowing up with the last buyer (who bought at the high) “holding the bag” on a coin that is useless.
Many coins have a strong marketing team behind them and little else. Do not confuse the Top 100, or Top 20 list on coinmarketcap with the Dow Jones Industrial Average or S&P 500.
Better ways to use coinmarketcap
Use CMC as one part of your investigation into cryptocurrency. If you hear about a coin from somebody, go to CMC and you'll find a link to the coin's website, as well as its block explorer (if it has one).
If this was helpful, please click below to follow me and read more in this series!
a very helpful post. I would have confused the Top 20 list on coinmarketcap with the Dow Jones Industrial Average LOL
It's a pretty common error but the space is just too volatile to trust the list in that way.
Is it useful? Yes. But probably not for the newer users.
yes, I agree
Is like the wikipedia of all crypto coins.
Thanks for the posts, im gonna follow and try to help.
That's a pretty good analogy-just as wikipedia is a good starting point, so is CMC.
Thanks for sharing your knowledge, upvoted your article and follow.
Great and concise post..thank you
Great point. Many of the coins have such a small amount in circulation that it is easy to get a high market cap. BitConnect is one such example of this. (BitConnect is a Ponzi Scheme.) According to the block explorer the top 100 addresses own 93% of the coin. That leaves 8600 addresses owning 7%. The top 1000 addresses own 99.71% that means 7797 people own 0.29% (less than one half of one percent.). the purpose of this is to give the coin credibility. Among those new people. -Look it is a top cryptocurrency.-https://chainz.cryptoid.info/bcc/#!rich
Exactly. Further back in my writing on here I explored some ERC20 tokens and how spread out they were. It was very enlightening.