It’s no secret that cryptocurrency prices have been in a downward trend for months now. Shifting trends, higher fees, and overall skepticism brought by failed ICOs and projects have been hitting the industry non-stop since early 2018. However, the case is different with its back-end technology: blockchain.

For years now, the world measured the value of cryptocurrency by how the mainstream media reports it: 3000% gains, rags-to-riches stories – completely disregarding the concepts and technologies behind why cryptocurrency became valuable in the first place. This gives many new and prospective investors the illusion that cryptocurrencies, any of them, are the key to wealth in today’s digitized world. Although this is true in some respects, there is an undeniable proof that there are also many risky ventures in the crypto space.

This puts into question the necessary things to consider when venturing into cryptocurrency. Is there such a thing as a crash course to cryptocurrency investment?

Yes: It’s called blockchain.

Looking behind the scenes

Blockchain has been a sleeping beast for years now and for good reason: it was completely eclipsed in popularity by a product of its own. Blockchain is the fundamental technology behind cryptocurrency and its distributed ledger technology is the key in understanding how to make investments in the cryptocurrency space.  While cryptocurrency prices are low compared to last year’s, blockchain-adoption is still receiving favorable reception with counties like Colombia, Malta, Thailand, and even Japan considering applying it to their government infrastructures.

Investors should understand the key problem that blockchain is trying to solve: the presence of intermediaries for transactions, which became a core factor as to why its most salient application is in currencies. To understand the value of cryptocurrencies and blockchain, one must first understand moving away from central figures and intermediaries in terms of day-to-day living.

To keep it short: the removal of intermediaries will allow all participants to operate in a fair and transparent platform. This concept will be a fundamental guide for any investor looking for projects that are worth their while.

The frontline: blockchain use-cases

Investing in cryptocurrency is very speculative, and you should only invest what you are willing (and able) to lose.

That 3000% gain or a quick return may be a thing of the past, but you can make gains if you do a lot of extra legwork.  Investors have to research existing use-cases and compare the pitch of the ICO (initial coin offering) or TGE (token generation event) they are eyeing to weight their options. Extensive research into many aspects of the cryptocurrency will need to be involved.

If you’re going to invest, invest in blockchain use-cases and a successful team. Holding a diversified portfolio of coins backed by a strong set of use-cases and having a team that has been successful in other businesses can give a good foundation to build from.

Blockchain use-cases are the key factor for any crypto investment as it will be a strong indicator that the platform will be used in real life and thus generate transactions and value. This will also mean that the team behind a project with strong use-case will put the maximum amount of effort in maintaining the blockchain platform and the coin economy attached to it. A few examples of use-case industries that might find blockchain useful are fintech, supply chain, health, food, transportation, and governments.

Indicators and challenges

There are many things to consider before investing in a project. There’s the team behind it, the problems they are trying to address, the blockchain protocol they are utilizing, and the extent to which they are integrating blockchain into their solutions.

However, a quick way to judge a good project is to consider the cooperation of existing organizations and sectors in using the platform or project. After all, blockchain is a community-based technology: no community, no authentication. It is safe to say that a blockchain without a community or an alliance doesn’t make much sense in practical application. In short, look at how the project is received not only by the coin investors but the users of the blockchain solution itself. Consider the brands, names, and thought leaders involved in the project and do extensive work on researching every detail about their whitepaper.

Investing now on cryptocurrency is much harder than it was years ago simply because of the sheer options available to the public. Investors today must be wise and rely on the applications of the blockchain project to fully gauge the potential value of the coins.

Not an Investment Offer

This Article will not and cannot be considered as an offer to enter into an investment. It does not constitute or relate in any way, nor should it be considered as an offering of securities in any jurisdiction. This document does not constitute an offer or an invitation to sell shares, securities or rights.