Altcoins burst onto the scene with enthusiasm, energy, and excitement. Some go on to build sustainable projects that keep advancing. Others die off almost immediately, some even as quickly as a MayFly. What are the reasons for this? Why does this pattern keep repeating? Let’s take a look at why this cycle of boom and bust keeps on happening.
A lot of it has to do with the intentions of the project team. If they don’t plan on building a long-term project than the coin is going to have a short life span and a miserable existence.
Others create their coin with the intention of going the distance, but don’t have the staying power to finish the task. They may suffer from short attention spans or they may become disappointed when things don’t happen fast. They probably underestimated just how much work it takes to create something of lasting value. Success generally doesn’t happen overnight. When the going gets tough, most Devs get going - out the door, that is. This leaves a situation where any true believers in the project are left holding the bag.
As we always tell newcomers to Altcoin City - don’t be a sucker. Once people know you’re a sucker, you can expect to have your pockets picked every day. Wise up and start noticing the patterns and the players who are making things happen.
Once you’re good at doing this, you can enter trades relatively safely.
Identifying The Players
Quickly identifying what type of launch it is should be enough to prepare anyone for what’s likely to happen afterwards. If you know the score before the game starts you’re not likely to get burned. Or at least not completely incinerated.
If you aren’t sure of your instincts, move on.
Occasionally you may miss a winner by being selective, but more importantly - you’ll miss out on losers. That’s enough to make you a better than average return as a miner of investor.
Short term thinkers
Short term thinkers usually aren’t out to genuinely scam anyone. They have no idea how their altcoin is going to compete in the long-term, but they want to launch it anyways. The trouble with them is they’re counting on a rising coin price to make up for any weakness in their coin. If they run into trouble and the coin isn’t worth much, they can’t buy their way out of the trouble.
In the end, this type of launcher is relatively easy to spot. They will leave telltale signs that they’re incompetent. This type of launcher can cause a lot of trouble for anyone who thinks they have more capability than they do.
If you correctly recognize one of these types and get in and get out early, you should be okay. But if you hold for the distance, you will end up holding the bag. These types of ‘Devs‘ give up before long and the project and price languish as a result.
FlashCoin Devs could be short term thinkers or outright scammers. The only way to really tell is to do forensic accounting of the Blockchain, after the launch. Always be very wary of a FlashCoin, even if you’re set up early to mine. If you think something smells fishy, get out at the first sign of profit.
Scammers
Scammers are not easy to identify. Depending on their experience pulling scams they may be extremely hard to catch. Scammers need to make the most possible money for their efforts in the shortest possible time, since there’s no possibility of long-term success. When they get found out, their game is over. They will generally be aggressive in using tactics like IPOs and instamines. They need to control a significant supply of the coin upfront because they want out fast.
Again, scammers are getting smarter and only a forensic audit of the blockchain and code will turn up their misdeeds. If you get a bad feeling about a Dev, pass. You are always better off living to fight another day rather than perishing on a horrendous investment of money or electricity.
Scammers keep on coming back, so keep your eyes open at all times. They’re making a killing in Altcoin City and you don’t want to end up as another one of their victims.
Once a scammer, always a scammer.
Avoid scams at all costs by educating yourself and knowing your surroundings.
The Real Deal.
When you find a real deal Dev, you can count on the project continuing. This still doesn’t guarantee complete safety in an investment, but it’s a great start.
Real Dev teams have plans and are willing to answer any questions you have. They also have identities that you can easily learn more about. They’re not generally as likely to be brand new.
When you identify a real Dev, you’re putting your faith into them following up. If they continue to promote beyond a certain point they will gain traction for their coin. They also have the support of their community because they’re able to make improvements. Any Dev team needs at least one qualified coder if not more. Altcoin wallets need upgrading and features. A real deal Dev team gives the project a distinct advantage over one that’s just pretending.
Thanks for stopping by and reading. If you have any comments, please leave them below.
