Investing in cryptocurrencies can make or break a lot of people’s portfolios. It is a choice to gamble like a degenerate and throw your hard-earned dollars to the market with the hopes of making 10x profits giving no effort. It is also a choice to do general market research, curate those choices, and invest with a befitting risk tolerance of oneself to limit the downside (which can lead to ruin if not careful) and raise the probability of upside (that can lead to asymmetric high returns).
In today’s article, we are going to learn where to find Cronos projects to invest in. We will also slightly cover how their valuations work. First things first. Where to find out about tokens in the Cronos ecosystem to begin with?
Twitter has been a huge impact on the crypto ecosystem. Projects announcements, individual reviews, networking opportunities were all possible by the Twitter ecosystem. It is, by far, the most dominant online environment for cryptocurrency projects and influencer profiles to flourish. Cronos chain is no exception to this rule.
From these hashtags and accounts, an investor can be informed about new project launches, giveaways, AMA’s, and other relevant news. But remember, none of those tweets should be taken as investment advice. Twitter should be merely used for getting to know about a project, being informed about them, and observing other people’s attitudes towards it. That’s why personally verified distinct research is important before investing since crypto is a little bit more dangerous than other investment instruments due to a lack of regulations. Hearing about a project is the first phase of the research, not the last! All that said, investors shouldn’t shy away from opportunities from Twitter. Right circumstances combined with due diligence can lead to substantial returns and they do, all the time.
Telegram is the big lounge of the whole crypto ecosystem. Exchanges, projects, communities, and simply people just gather there and talk about crypto-related topics. It has been the dominant messaging app forever, long before Discord’s recent popularity. Telegram is relatively preferable and more focused than Discord. Projects have one dedicated chat room for everything, unlike Discord where the engagement of community members is being diluted by many chat channels.
Finding tokens on telegram is a little bit less straightforward than finding them on Twitter. In this case, it is like eavesdropping on real-time conversations of many individuals those share opinions about projects, their experience with developers, and their engagement with the communities. Even developers themselves are directly and frequently interacting with those who are in the telegram group.
Telegram group chats are great places to mingle ideas, read the room and interact with the community members directly to see whether you can see yourself being a part of. Crypto investments are all about community, developers, and their joint efforts. The quality of the project and the aligned values of participants are good predictors of a successful project. So a telegram group chat can be used for both determining the value of a project by watching the members of particular projects, or it can be used to become aware of new projects and opportunities through real-time conversations of people who have strings attached to the crypto ecosystem.
Curating Your Choice for a Cronos Project to Invest in
Seeing a token name on Twitter, or reading a shill message on Telegram can’t be viewed as “discovering a project”. A potential investor needs to get more attentive than that. There are a couple of quantifiable properties to evaluate a crypto project as along with qualifiable ones. Quantifiable properties of a project would be its market cap, daily volume, its tokenomics, social media channel following, and so on. Qualifiable properties of a crypto project would be its website, how informative it is, and its whitepaper. The whitepaper is the project’s whole argument of why does it exist. The foundations are being built on top of it, so a crypto investor should be able to read those whitepapers, a chunk of them, so they would acquire a sensation of determining which projects would be worth investing in. It is too wide of a subject how to qualify worthwhile projects so we are not going to cover that in this article. Stay tuned for the next articles though!
To expand on the quantifiable properties of Cronos projects, we have a market cap, daily volume as two basics at hand. Market cap is an indicator of a project’s current valuation, unlike the price. This is a confusing subject but let’s make it obvious and simple to understand:
If a project has a $10,000,000 market cap and one token’s price is 1 dollar, relative to a project with a $100,000,000 market cap and one token’s price is 10 cents, the latter is more expensive because for that token to be 10 cents the tokenomics require $100,000,000 to be invested in, for the former that requires $10,000,000 to get the price to $1.
|Projects||Market Cap||Price per token|
2nd project is more expensive because, to move the token’s price to $0.10, $100,000,000 needed to be invested in. So the project’s valuation is determined by its market cap, not by its price relative to other projects.
A real-life example:
You can see DOGE’s price is $0.1436, meanwhile CRO’s price is $0.4871. But DOGE is ranked 11th, CRO is 16th. The reason is, DOGE’s market cap AKA its valuation 19 billion dollars, CRO’s market cap AKA its valuation is 19 billion dollars. Consequently, the bigger the market cap the more expensive the coin is regardless of a single token’s price.
When it comes to daily volume, it is a pretty simple property to understand. Volume is how much money is moving in and out on a particular trading pair on a particular time frame which is a popularity indicator that is constituted from capital. So if a token has 1 million dollars worth of daily volume it means 1 million dollars worth of tokens had been traded there in the last 24 hours which is a fairly good indicator of the project’s liquidity.
So as these two most important metrics, market cap, and daily volume/, is the good starting point for investors to understand what they are investing into. In summary, the higher the market cap the more expensive the project is and harder it is to go to higher prices but generally lower the risk(because the project is relatively established). The daily volume shows how much people are interested in trading the project which makes it buying and selling easier for investors, to get in and out.
As one real-life example:
This data is taken from DEX Screener which we featured how to use in this article. You can see the market cap as $51 million which makes the project relatively expensive compared to the majority of Cronos projects and it has a daily volume of $42 million, almost as much as its entire market cap. This is a very healthy indicator of the project’s valuation, popularity, and legitimacy because many people are buying and selling it.
Now, this article can serve as an entry-level for investing to a starting investor. They can know where to find Cronos projects, where to get the general sense of what their valuations are, and what the most fundamental values of those market cap and daily volumes exactly mean.