Cryptocurrency sometimes is characterized with hype and Fomo, in as much as some people have made a lot of fortune from this others have suffered from severe loss.
Now, one will wonder, “how will I know the exact token to buy”. The truth is that in crypto we hope for the best, but there are some important safety precautions that will help save you from making unnecessary mistakes, here are there:
Review of contracts/Audits:
Never buy a token which it’s contracts hasn’t been reviewed by you or Any verified Auditing platform, as most contracts may contain some malicious codes that is aimed at defrauding Users.
Avoid any unofficial links:
In as much as you have verified a tokens contract, Never enter any unofficial link that is not posted by the tokens social verified handles (Twitter, Discord, Telegram). Even if the link is posted in the Tokens official social media make sure it’s from one of the Moderators/Admins.
Never invest more than 10% of your portfolio:
As good and profitable as a new token will seem, never you invest more than 10% of your net-worth, especially when the token has not yet listed on Tier-1 exchanges.
Chances are that the Developers may sell of their token bags leaving you stranded and In loss.
Always check Token’s Total Supply:
Most meme coins are known for outrageous amounts of Token total supply,
Many new users will be hoping for a token with up to 1 trillion total supply to reach a hallmark price of $10 per one, this is probably because they don’t understand what “Total supply” of a Token means and how it determines token price.
Always check out for the Highest token holders.
A token with 1 or 2 wallets which are not “Burn Address” holding more than 90% of the total supply is definitely one to be weary of. This is because these wallets can sell of at anytime and this is called “Rug pull” in crypto terms.
Always test to see if a Token can be sold:
Before setting out to buy any token with any amount always buy with a fraction first let’s say $0.1 worth of the token and then try selling off to see if the token can actually be sold.
Some token contain extra codings which are hidden from the public especially the newbies, These type of tokens are referred to as “honey pots” where by users can only buy tokens without being able to sell.
In summary, cryptocurrency can be risky at times especially for newbies, this article is directed to educate them.
Cryptonalyzed blog • 2023•??
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