While the crypto space offers many opportunities, there are also many risks and misinformation. Fraudulent schemes and scams are rampant in this world, and it’s important to learn to spot the warning signs. Kimberly Rosales, a cryptocurrency expert, shares some key tools to be able to navigate the cryptocurrency ecosystem properly.
You have likely realized by now that investing in cryptocurrency can be time-consuming, more so than traditional finance which is highly regulated. It is your responsibility to ensure that you have wealth protection.
Before you buy cryptocurrency, make sure you check the current price and determine a good entry point. CoinMarketCap is the most popular website for this purpose. CoinGecko is another. The first site lists over 20,000 coins while the second website tracks approximately 12,000. Both sites list new coins daily.
The price information is available to all users free of charge, without registration. It is possible to look at historical coin prices, often going back years or when the coin was first introduced. In addition, both sites also report statistics such as the highest and lowest price at which a coin has traded in a given time period. This can be useful in assessing the prevailing sentiment toward a coin you are considering investing in.
“By creating a free account on any of the sites, users can also access their respective portfolio trackers,” Rosales explains. “These allow you to manually enter the currencies you have invested in, the amount and price of purchase, and track their value over time.”
Delta is a portfolio tracker that can be used by anyone who invests in stock markets. You can track all your investments (stocks, NFTs, and cryptocurrencies) using the same interface. You can download Delta on Google Play or App Store for free. It is only available for tablets and phones.
Rosales suggests that analytics is a step beyond price tracking. This includes using the vast array of information on the blockchain such as price movements and transaction fees to get an idea of future performance.
Many crypto analytics platforms offer real-time data analysis only as part of their paid subscription plans. They may offer free plans that provide sufficient information for retail investors.
Glassnode is a beginner-friendly platform that offers free access to basic metrics such as market capitalization, transaction rate, and transfer volume. There are descriptions explaining the purpose of each metric and users can also compare different metrics on the same chart.
Using quantitative data is an important part of researching a cryptocurrency, as it can help provide an objective perspective. For example, if you see someone praising the potential of a cryptocurrency on Twitter, it is difficult to know if their ideas are legitimate or if they are simply promoting the projects because they are invested in them and want to generate excitement.
People can even use fake accounts to make it look like a project has more followers than it really does. Through data analysis, you can verify the number of wallets that actually hold the project’s cryptocurrency and make your own judgment. This can help prove whether the community is legitimate or not.
Santiment is another popular analytics tool that offers a free plan. Users can create their own custom watchlists and access up to two years of historical data, but with a 30-day delay.
If you want to do your own technical analysis, TradingView is the ideal platform for reading charts, drawing indicators, and testing strategies. The platform has long been popular with stock traders and has also introduced cryptocurrencies over the years.
TradingView offers free access to a wide range of indicators, although users will have to look elsewhere to learn how to use them sensibly. Those who are already aware can jump right in and start planning their investment strategy.
The platform allows the community to create and share their own scripts. These are lines of code that interpret price information and can be useful for identifying future trends. These scripts allow users to test their theories about market movements and use historical data to gauge how well their strategies would work.
While Rosales has taken care to provide everything you need to get started with cryptocurrencies, you should continue to develop your knowledge and learn about new trends, and even re-read when things get a little confusing. The crypto space is constantly changing and staying up to date is important to make sure you are making the right investments.