Evaluating the ‘best’ cryptocurrency is a difficult and constantly moving target. What defines the best cryptocurrency? Is it how much money is in its ecosystem? Is it based on popularity? Or are there other qualities to look for? Here are some metrics to compare and evaluate the best cryptocurrency.
What does the project aim to do?
It always helps to look from the ground up. This question lays the foundation that will help to evaluate if a cryptocurrency is a project worthy of development in the first place. Is the project attempting to improve on an existing process? Or is it a foundation for things to come? How does the project benefit from the use of Blockchain technology? These help to establish the position of a cryptocurrency in the market, whether the project is useful in its own right, or if it makes other projects useful. Setting these boundaries can focus development on the more important aspects of the project.
Who are the people developing the project?
Since cryptocurrencies usually hype up their developers by claiming they are the best in the business, it is important to evaluate if they are at least competent at what they do. Take a look at their past. Have they done something similar before? It is also good to look at the work that they do currently. After all, we don’t expect a programmer to manage the project’s social media do we? Lastly, looking at what the project aims to do, can the people in the project reasonably complete the goals they set?
How do these people plan to do their business?
If the project is holding an Initial Coin Offering (ICO), how do they plan to use the funds? How will it be allocated? Then, look at their actual platform and try to understand how it works. Is it a good, unique and feasible business idea? Make another evaluation: does the project even benefit or, at least, require Blockchain technology? If these are unclear, treat it as a red flag, it is possible that these are scams run by less than scrupulous people.
How useful is the project to its users?
After analyzing the project from the business’ perspective, try to see the project from the user’s side. It is one thing to say that a project is useful, and another to actually have it used by users. Even if the project can deliver on everything they aim to do, is it useful to its users? It is much easier to attract a huge user base if there is a need for the project today not 20 years from now. Also, the project could have competition. How does it fare relative to its competitors? Is it already established in its position? Competition could be a good catalyst for improvements, if it doesn’t outright kill a project. If a project is attempting to break the status quo, it’s better to have something of substance, a magnum opus behind its back.
These metrics highlight the need for due diligence on the part of cryptocurrency users. The rise of the best, the useful, and the outright scam cryptocurrencies is part of the growth of the developing cryptocurrency space. But when it does reach maturity, only the best cryptocurrencies will survive and reach the top.
Further reading: 4 Things Every Newcomer Needs to Know About Cryptocurrency