Post Menu and Details.
- Newest cryptocurrencies
- Hyped cryptocurrencies
- Not so hyped cryptocurrencies
- A few things to remember when trading new cryptocurrencies
Reading time: ~4 minutes
There are over 10,000 coins and tokens in the cryptomarket and new altcoins are popping up every day. For example, on average, 10-15 new cryptocurrencies a day are added on Coinmarketcap. So the list of the newest cryptocurrencies would either be very long or rapidly cease to be relevant.
In order to create a new cryptocurrency, developers do not need to run their own blockchain. Instead, you can create a token based on the existing blockchain and list it on the crypto exchange, for example, CEX.IO. If earlier most tokens were Ethereum-based, then in 2021 developers have many other options for launching their own tokens such as Polygon network or BSC. This is one of the reasons for such rapid growth in the number of new coins.
Another reason is the crypto market rally. In the first half of 2021, the capitalization of the crypto market soared, and many cryptocurrencies, including Bitcoin, updated their all-time highs. This drew attention to cryptocurrencies and inspired many teams to launch their own cryptocurrency projects.
Investing in the newest cryptocurrencies sounds promising but at the same time, it is risky. Everyone would like to buy Bitcoin or Ether when their price was extremely low but not all new cryptocurrencies will reach the heights of Bitcoin or Ether.
Before investing in crypto, it is worth doing thorough research regardless of whether it is a new cryptocurrency or not. But in the case of trading on new coins, it is worth paying attention to some additional factors.
While many were monitoring prices of major cryptocurrencies in early 2021, some new projects managed to grab the attention of crypto enthusiasts. For example, Safemoon launched in March 2021. This DeFi token is designed to encourage long-term investment and discourage sales. Safe moon developers are also targeting the NFT market and are regularly reducing the number of tokens in circulation. The token skyrocketed in April and reached a market cap of $6 billion, but now it is trading 88% below its all-time high.
Another cryptocurrency that has become a buzz in 2021 is Chia. Unlike other cryptocurrencies that are predominantly mined on ASICs and GPUs, Chia is mined on SSDs and HDDs. Chia became so popular in May and June 2021 that it caused disk drives prices to spike. The Chia boom has helped Seagate and Western Digital keep their factories full, and disk drives makers also considered increasing spendings to meet demand. But then, the Chia price began to gradually decline and now it is trading 90% below its all-time high.
Among the hyped cryptocurrencies launched in 2021, it is worth noticing a whole category of cryptocurrencies – meme coins. After the Dogecoin surge in early 2021 that helped cryptocurrency to enter the top-10 cryptocurrencies by market cap, more and more meme coins began to appear parodying or copying the idea of Dogecoin. Along with the crypto market and Dogecoin drop, a lot of meme coins fell in value as well. Some of them, such as Baby Dogecoin, are now trading 95% below their all-time high. But this does not mean that the trend for meme coins is over. For example, in September 2021, the DogeZoo meme coin was launched, and some other meme coins are planned to be launched this year.
As soon as Internet Computer (ICP) launched, it immediately entered the top 10 cryptocurrencies by market capitalization. However, the cryptocurrency became available for trading in May 2021 shortly before the market drop by 50%, and it quickly sent its price down. Even though ICP is trading 90% below its all-time high now, it still continues growing in popularity due to ambitions that go beyond the crypto market. The Internet Computer platform enables users to create applications, websites, and other web services. The project is trying to recreate the Internet but in an even more decentralized form.
One of the most unusual launches of recent months is Bitclout. The project’s tokens are aimed at facilitating the buying and selling of the so-called “creator coins”. These coins are tied to specific social media individuals whose actions can change the value of creator coins. The main goal of the project is to make social media a more decentralized space. The Bitclout token started trading in June 2021 and is now 60% below its all-time high.
Landshare is a project that aims to decentralize the real estate industry using the DeFi principle. Token users can take part in the sale of tokenized houses, receive passive rental income, or capitalize on property vaults. The project launched in August 2021 and is now trading 65% below its all-time high.
As you can see, when a new cryptocurrency becomes available for trading for the first time, it may experience a temporary drop. This does not always mean that the token is “bad” or that the rest of the market influenced it. Just those who got access to cryptocurrency before it goes public get the opportunity to sell and exchange it. This allows some to fix returns on their investment or get rid of tokens if they no longer want to support the project. Even popular now Uniswap and Polkadot cryptocurrencies also experienced a drop immediately after the start of trading.
Besides, new coins often experience liquidity issues. This suggests that large enough orders on various exchanges can cause a strong change in the asset price. It is the reason for such high volatility of new cryptocurrencies and why they can sometimes both surge and drop by tens of percent per day. That is why if we are not talking about long-term investing, then you can consider placing stop loss and take profit orders to protect funds from volatility when trading on new cryptocurrencies. Stop loss and take profit orders are offered by some cryptocurrency brokers.
Despite the huge number of coins in existence, new cryptocurrencies will continue being launched. The crypto market is still in formation and new cryptocurrencies are not always competitors to established projects. The list of top-10 cryptocurrencies by market capitalization changes every year and quite often you can see projects there that are only a few years old. But you should remember that only a few will receive the same recognition and support as the top cryptocurrencies.
Thank you for reading!