Cryptocurrency is one of the most profitable ways to make money today. Many people believe that investing in shitcoins can change your life overnight. Although there is no doubt that cryptocurrency is very profitable, it is also very important to note that cryptocurrency comes can also be a risky form of investment, and if not properly done, an investor can lose everything in a blink of an eye.
There are various ways to make money from cryptocurrencies such as staking, spot trading, futures trading, investing, and yield farming.
One of the most profitable forms of crypto trading that can make you rich overnight, if done properly is “Shitcoin Trading”.
The term shitcoin is quite controversial in the crypto space not just because of the name, but because of the nature of this kind of cryptocurrency project.
Shitcoins are valueless coins that do not have any utility or contribute anything to the crypto space. The majority of the shitcoins are created for a “pump and dump” scheme, which aims to reward early investors, while other investors are left with large quantities of these useless tokens with little or no value.
The success of bitcoin led to the birth of many cryptocurrencies. As a result, new terms and expressions, have also emerged from the booming cryptocurrency ecosystem. Although there are two classifications of cryptocurrencies which are:
- Bitcoin and
- Altcoins.
Altcoin is the combination of two words “alternative” and “coin”. Which can be simply defined as other cryptocurrencies different from bitcoin like Ethereum, Cardano, Solana, Matic, Doge, and Shiba Inu.
Shitcoin is a term commonly used to belittle many cryptocurrencies project because of their nature, and the intentions of the creator of those coins or tokens. A good altcoin is created to add value to the crypto ecosystem, improve the technology used in the crypto ecosystem, solved real-life problems, and have a use case (utility). Which makes it relevant, valuable, and useful.
What are Shitcoins, and why are they referred to as Shitcoins?
There are thousands of cryptocurrencies out there, and hundreds of new cryptocurrencies are created daily.
It is imperative to know that there are many absurd cryptocurrencies, these cryptocurrencies were solely created to scam people. They have no innovative contribution, usefulness, or bring a solution to the crypto ecosystem.
Their goal is to create a valueless token, gather a community of people to promote this token, and attract early investors who will invest a huge amount of money into this project, when the token pumps and begins to attract more people; they sell the token (dump) on the late investors and repeat the cycle… Understanding the way the pump and dump scheme works, will help you not to lose your money.
Therefore, the term shitcoin refers to all the useless cryptocurrencies that exist in the market. Cryptocurrencies without utility, specified purpose, offered at speculative prices, with ridiculous supply, and are cheap copies of other projects with no use case.
There are hundreds of thousands of cryptocurrencies and Tokens out there. How many of them are considered a shitcoin?
Honestly, there is a vast majority of shitcoins in the crypto space and more keep emerging daily. The success of Bitcoin, Ethereum, Solana, and some good altcoins attracted a lot of attention and investor into the booming crypto industry.
Jokingly, meme coins or shitcoins, like dogecoin and Shiba Inu, became very successful and made many investors rich. As a result, many people are looking for the next shitcoin that will make them a fortune and change their lives too.
Shitcoins most of the time do not present clear goals or objectives, they have no utility or use case, they bring no solution, and their only aim is to attract investors to invest money while promising unrealistic rewards and returns after investment.
How to Identify a shitcoin?
When a new cryptocurrency is developed and launched, some uniqueness makes this crypto project safe, reliable, and useful for potential investors
There is a document called the whitepaper that explains in detail what the project is about, the goals of the project, the people behind the project, the solution they intend to bring, the use case, utility, and the roadmap of the project.
More so, who is the team behind the project (are they doxed), what have they done in the past, are the expert or experienced, and do they have a good reputation? These are also factors to consider before investing in any cryptocurrency.
It is important to be logical and use common sense, are the goals of the project realistic, does their roadmap look objective, are their promises achievable.
In a situation when that project promises groundbreaking transformation to the crypto industry. But lacks clear objectives, technical knowledge, and defined functionalities, and its developers are somewhat mysterious, there is a 99.99% probability that it is a shitcoin.
Yes! especially when the promises are mouthwatering, and they have little or no proof to back themselves, rather than aggressively marketing the project, and promising high returns after investment.
With the technological advancement nowadays, it is common to receive unsolicited advertisements and notifications, about the launch of new projects that promise an infinity of benefits.
However, in order not to be carried away by the promises that these projects offer, one must consider evaluating these projects and their promises to have a clear idea of whether they are reliable or not.
How to Identify a Scam Shitcoin
Identifying a scam shitcoin is not an easy task, this is because creators of these shitcoins keep devising new means to upgrade their tricks daily and also stay ahead of their victims.
Many shitcoins are created to exploit people who invest money into a crypto project without doing their due diligence.
People do not take their time to research the project they want to invest their hard-earned money into, before following the bandwagon to jump into this project.
It is no longer news that many investors have lost some huge amount of money from a hundred to thousands of dollars investing in shitcoins.
The success of some early investors of coins like Dogecoin and Shiba Inu token makes investing in shitcoin extremely tempting.
It is important to always remember that you should never invest more than what you can afford to lose, and you must always do your research first.
Therefore, these are some useful recommendations for you to identify a shitcoin:
- If the whitepaper is an obviously identical copy of another known project. It is written with a technicality almost impossible for anyone to comprehend, or the project does not even have a whitepaper, do not hesitate, it is a shitcoin.
- If the team behind the project or developers are not doxxed (hidden identity) or are made up of a small group of strangers, who hide behind false names, cartoon characters, or emojis. Then be very careful, it is a shitcoin.
- If the official website where the project is presented is unprofessional, not secured, lacks originality in design, or uses free domains. These are red flags.
- If the project offers thousands of mouthwatering benefits in general but does not specify in detail how they intend to achieve this result.
- If the project does not present a work plan, with clear goals that guarantee the development of the project in the future, be careful.
- Or they simply develop a fork of some cryptocurrency by changing some things and that’s it. In short, it does not innovate at all.
- If a large amount of the liquidity of the project is not locked, or the link to the lock is not posted so that investors can verify, that is a huge red flag.
- If the project has not been audited by any major crypto audit like the CERTIK audit, you need to be very careful, investing in such a project could be very risky.
- If the buy and sell tax on the project is outrageous, over 25% of your money, you need to be very careful, it could be a honeypot.
The list goes on and on. Many times. The developers create the project, launch it, and promote it in the market, and after they have managed to make a profit at the expense of investors, they abandon its development. They do not return to dedicated work or effort to continue developing the code. Giving rise to a shitcoin that does not contribute anything to the system.
Although shitcoin can be very profitable, if successful. The reality is that only a few are lucky to make a fortune out of shitcoin trading. Therefore, always remember to do your due diligence and never invest more than what you can afford to lose in any cryptocurrency project.