Crypto Academy Week 14- Homeworl Post for Professor @pelon53 on Penny Cryptocurrencies.
.jpeg)
Explain the Penny cryptocurrency in your own words. Advantages and disadvantages.
From the word penny, it means a small amount of money. Penny cryptocurrency is an undervalued cryptocurrency usually under $1. These currencies are very cheap and can be bagged in large quantities. Penny cryptocurrencies are highly volatile in nature and are susceptible to dump and pump in the market. Most penny cryptocurrencies are newly minted coins that yet to gain the attention of investors. Similarly, some of them have a huge amount of supplies making them undervalued in the market. One good thing about penny cryptocurrencies is that they can yield a huge return of investment as the projects are still developing. People invest in penny cryptocurrencies with the idea that the project will perform very well in terms of market capitalisation.
Advantages of Penny Cryptocurrencies
Affordable: Penny cryptocurrencies are very cheap and can be bagged in millions or even billions of quantities for a relatively low price. This makes it affordable for anyone to invest in them.
High return of investment: Most penny cryptocurrencies are still at the development stage with low market capitalisation. They tend to yield a huge return on investment in the future. An example of this is Dogecoin and Bittorrent. These cryptocurrencies made its early investors millionaires as the project got the attention of the public.
Long term investment: If you are looking for a long term investment in cryptocurrencies, then penny cryptocurrencies are the best for it. The reason is that these projects are still developing and haven't completed their roadmap. Also, they are very cheap and can give a huge amount of profit when you hold them for a long time.
Access to Cryptocurrency market: Penny cryptocurrency gives people the opportunity to partake in cryptocurrency evolution due to its relatively low price. Most large-cap cryptocurrencies are already expensive and are difficult to acquire. Some exchanges have limitations to the amount you can purchase and trade. But with penny cryptocurrency, users can still benefit from the amazing opportunities cryptocurrency offers.
Disadvantages of Penny Cryptocurrencies
High-risk: Most penny cryptocurrencies end up not reaching their potential. This can be due to the team abandoning the project in the process. Similarly, most penny cryptocurrencies are scammed projects. Due to the fact that anyone can create cryptocurrencies, some developers use it as an opportunity to create fake cryptocurrencies and abandoned them when people have invested in them. This makes penny cryptocurrencies very risk.
Susceptible to pump and dump: Due to the fact that penny cryptocurrencies are very cheap and affordable, big investors (Whales) use that opportunity to acquire a huge amount of the coins. And with that, they have control over the price and manipulate it for their own gains.
High volatility: Penny cryptocurrencies are exposed to very high volatility access d see the price change of up to 70% in minutes. This is because of the large amount of supply and low price of the coins. People acquire them in large quantities which increases their volatility during pump and dump.
For you: What will be the best penny to invest in this 2021? Explain and show evidence.
For me, the best cryptocurrency to invest in in 2021 is REEF.Finance. REEF is a DeFi ecosystem built on the PolkaDot network for cross-chain and interoperability of DeFi platforms. This is a major setback DeFi platforms and REEF aim at solving these problems. With REEF Finance, users can access and interact with other DeFi platforms in a single platform without undergoing the difficulty of creating multiple accounts to access financial services. Similarly, REEF Finance also aim at solving the liquidity issues in DeFi platforms and also the huge amount of gas fess encountered in Ethereum platform.
Why REEF
The development of REEF started in the second half of 2020. And since then, the project has gained the attention of the public within a short period due to the problem REEF aim at solving. Also, I see REEF as the future of the Defi ecosystem as more developers and users will partner with this platform. The reason is that REEF Finance aims at solving interoperability among DeFi platforms, liquidity issues and high gas fees. Similarly, REEF Finance platform is highly secured as the project adopts the PolkaDot security model.
REEF currently supports DeFi protocols on Binance smart chain, Ethereum network, Plasma and Moonbeam this short period REEF have also partnered with Aavegotech and DEIP network to improve the DeFi ecosystem and also the cryptocurrency is currently trading in Binance exchange. One shocking thing about REEF is that they have achieved all these goals without launching its Mainnet. This is a sign and proof of how dedicated the team is to make REEF the leading DeFi platform. REEF mainnet will be expected to be launched this month and this will be a big development in the price of REEF as more investors will be attracted to the project.
Now let's look at the market statistics of REEF.
Market Stat of REEF from CoinmarketCap
| Overview | Stats |
|---|---|
| Price at time of writing | $0.0252 |
| Rank by market cap | #129 with market cap of $486.24 million |
| Total supply | 15.93 billion |
| Circulating supply | 12.66 billion |
| 24 hour trading volume | $168.76 million |
| Market dominance | 0.02% |
| All-time high | $0.058 |
| All-time low | $0.066 |
From the information we have above, REEF is currently trading at $0.0252 with a market cap of 486.24 million. Right now, I consider REEF undervalued because of the amazing features the project has in the future. And this will start evolving after REEF have launched its mainnet. Similarly, unlike other penny cryptocurrencies with huge supply, REEF has a supply of 12.66 billion which is very low compared to other penny cryptocurrencies. This will increase the demand for the cryptocurrency in the future and will in turn increase the value of the coin.
From the chart above, we see the price has been ranging between $0.53 and $0.03. Price broke down to retest a support level at 0.017. From the chart above, I expect REEF to break the daily support level at $0.03 and also break the resistance level at $0.0.53. My prediction on REEF is that it will hit $0.1 before the end of 2021. This project has a lot of potentials which we will see manifest after its Mainnet.
Do a Ripple ( XRP) analysis. Show screenshots. Would you invest right now? Explain.
XRP is no doubt a cryptocurrency project that has a lot of potential in the financial market. Ripple has proven to be a better option than the Bitcoin network in facilitating currency transfer. Ripple offers a lot of benefits which includes faster transaction fees, low transaction cost compared to other networks. Banks and other financial institutions will adopt the Ripple network for payment services and this will improve the price of XRP.
Currently, XRP is undervalued and its future is undecided due to the SEC suit against Ripple. Ripple is currently trading at $0.88 with a market cap of $41.21 billion. This is a very low price for XRP and also a good time to invest in it. But let's look at the technical analysis to back up our investment decision.
From the chart above, XRP just broke a daily resistance at $1.033 and we see the price approaching daily support at $0.63. We can expect a further downward movement in the price of XRP which will be at the support at $0.63. After that, we will see a reversal to the upside. Buying at this support at $0.63 will be very good because you will be buying at a relatively low price.
But currently, there's uncertainty as we don't know if the price will retest the support at $0.63. Price can still reverse back up and break the resistance at $1.03. So the best thing to do is to wait for the price to come down to support at $0.63. Or you can wait for the price to break the resistance at $1.033 to confirm the reversal. This can be shown in the chart below.
From the general perspective of XRP, now is the best time to invest in XRP as the coin is undervalued right now. The technical analysis aims to help us get a better entry position and also buy at a cheap price. The only threat to investing in XRP right now is the ongoing SEC suit which I believe has no major impact on the price anymore as Ripple team are collaborating to resolve the ongoing issue.
Present in detail a possible investment of 5 penny crypto assets. Explain and present data confirming your choice.
In this section, I will list 5 penny crypto asset for possible investment. My choice of these penny crypto assets will be based on fundamental and technical analysis.
REEF
REEF finance tops my list of penny crypto asset for possible investment. REEF has huge potential for DeFi ecosystem and the project is making huge progress. REEF have made big progress and partner with blockchain platforms like Binance smart chain, Ethereum, Avalanche, Plasma. REEF is the future of DeFi ecosystem as the platform aim at solving the setbacks encountered in current DeFi platforms. REEF will be launching Canary version of its mainnet on the 28th of this month. This will be a big development for the project to attract more investors to REEF.
From the chart below, we can see REEF price is relatively at the moment. Price is currently sitting at a support area at $0.024 and we will see a reversal on the price of REEF. REEF has a lot of potentials to offer to DeFi ecosystem and will definitely increase its market cap in the future.
Safemoon
Safemoon is a fast-growing cryptocurrency based on tokenomics. Safemoon is growing rapidly and has a very strong community. Currently, Safemoon has a market cap of $4.8 billion and liquidity of $386 million. There are more than 1.9 million holders of safemoon at the time of writing this article. Safemoon is also working on Safemoon wallet and exchange and Safemoon token will be the native currency for the platform. Safemoon aim at rewarding users who hold Safemoon token. Safemoon is currently trading at $0.000005 and the project is a good investment for long term.
Safemoon has a total supply of 1 quadrillion. This supply was massive and a major concern for investors. But recently, Safemoon burnt 412 trillion of its total supply. And from the coin tokenomic, there will always be a manual burn of the token and also a 10% task on every transaction of Safemoon token. This constant token burn is a major development that will reduce the massive supply of the coin. Also, users get rewarded for holding Safemoon tokens.
Shiba Inu(SHIB)
Shiba Inu is another penny cryptocurrency that is enjoying rapid growth for some weeks now. Shiba Inu is an ERC-20 token created to mimic Dogecoin as a meme coin. Shiba coin was created in August 2020 to overtake its meme counterpart Dogecoin. Shiba was recently listed on Binance and OKEx exchange and this was a major development for the coin. Recently, Ethereum co-founder was given 50% of Shib token which we don't know his plans for the cryptocurrency. But Shiba has a strong community called Shib Army who believes in the project.
Shiba is currently trading at $0.00000729 which is very low at the moment. I recommend Shiba for a long term project. According to crypto analyst, Shiba is expected to hit $0.001 before the end of this year.
From the chart above, we have seen Shib break a support level at $0.0000128. Hopefully, this is the best time to invest in Shiba. From the technical analysis, the price is expected to break the new resistance to retest the all-time high at $0.000035 before continuing its bull run.
BitTorrent (BTT)
BitTorrent is another penny cryptocurrency that I recommend for possible investment. BTT has grown more than 1800% in the last 12 months. BTT aim at providing file-sharing services to users. BitTorrent was acquired by Tron's co-founder Justin Sun and I believe this adoption will be a good development for BTT.
BTT is currently trading at $0.003698 at the time of writing this article. The total supply is 990 billion and the market cap is 2.44 billion. Let's look at the technical analysis of BTT.
From the chart, BTT broke a support level at $0.0051 and have found another support at $0.037. Double bottom is formed which signalled a possible reversal to the upside. This is the best opportunity to invest in BTT as the price is expected to break the resistance of $0.051. After that, the price is expected to hit the next resistance at $0.0085. This is 120% from its current price and BTT can surpass this price due to its potential.
Tron (TRX)
TRX is the native token used in Tron blockchain. Tron network claim to be a better network than Bitcoin and Ethereum in terms of transaction speed and transaction cost. Tron aims at facilitating the entertainment industry by delivering simple distributed file sharing and also allowing content creators to build their own tokens and decentralized gaming platforms. Tron network has a lot of potentials and the native token TRX is currently undervalued at $0.074. This is a cryptocurrency that has better transaction speed and transaction cost better than Bitcoin and Ethereum network.
TRX has a market cap of $7.6 billion with a total supply of 100 billion. TRX has a market dominance of 0.35% and a trading volume of $2.1 billion.
From the chart, we have price rejection at major support at $0.067. TRX is expected to reverse at this point to retest this year's high at $0.17. TRX still has the potential to hit $1 in a short time because the Tron blockchain has potential much better than Ethereum and Bitcoin in terms of transactions speed and transaction fee.
Shown an investment ( Started at $5) that you have made this week in Penny cryptocurrencies. List the steps you took.
Earlier this morning, I purchased 5.3 million Shib token with 39 BUSD ($39) on Binance exchange. I purchased Shib at an average price of $0.00000764. Below are the steps I took in investing in Shiba in Binance exchange.
Steps:
- I opened Binance mobile app and clicked on Trade at the bottom page. Binance trade page opens up.
- At the top page, click on the trading pair to select the coin you want to purchase. For this study, I selected Shib/BUSD pair because I'm purchasing Shib with BUSD.
- After that, I selectedspot* as shown because I want to perform spot trading. That is instant execution once the criteria are met.
- There are many modes of execution in Binance exchange. This includes limit, market order, stop-limit order and OCO orders. I selected market order to execute the order at the best market price instantly.
- After that, input the amount of BUSD and click Buy Shib.
- To view the transaction history, click the icon as shown in the picture below.
- After that, the landing page appears. Switch to order history to see the recent transaction.
From the picture above, the transactions I have carried out previously appear. From the image, we can see my recent transaction on Shib/BUSD. Transaction receipt can be shown below.
In conclusion, penny cryptocurrencies are better crypto assets that can yield a huge return of investment in a short time. An investor should also consider the risks involved in investing in them and also invest with money that can't affect one's finances. Similarly, proper research should be carried out on the project and team before investing in it as there are many scam cryptocurrency projects out there.
Thank you professor @pelon53 for this wonderful lesson.
Gracias por participar en Steemit Crypto Academy:
Excelente tu trabajo, me gustó, aunque un positivo en las subidas de las criptomonedas penny.
Espero seguir leyendo tus publicaciones.
Calificación: 9.5
Thank you professor @pelon53.
Twitter Promotion