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Over the previous decade, the prevalence and global adoption rates of cryptocurrency, especially Bitcoin and Ethereum have skyrocketed. With mainstream cryptos such as Bitcoin, far too frequently stealing the spotlight, it is easy to forget there’s another huge category of coins closely associated with digital currencies, known as shitcoins.
Shitcoins are a form of crypto coin or currency, with one major difference, they provide minimal value and long-term potential; however, shitcoins are known to attract significant speculation and attention from investors worldwide, often allowing them to shoot up more than 1000% overnight. Here’s a look at these lesser-known digital assets in more detail.
What Should I Know About Shitcoins?
It’s widely known that mainstream cryptocurrencies such as Bitcoin and Ethereum provide investor value while being backed up by widespread adoption rates, incredibly robust underlying technologies, and ease of access. On the other hand, shitcoins have far less potential and are often considered to have little to no value at all.
While there are thousands of lesser-known cryptocurrencies available worldwide, there is still a market for the best shitcoins to buy at any given time. According to crypto expert Goran Radanovic, as the crude name suggests, most may offer low-value returns if any at all. However, for traders savvy enough to follow the correct hype and speculation, there are plenty of shitcoins that do go on to succeed in a major way. For these reasons, lists of the best shitcoins often include some semi-famous coins for their novelty such as Pepe Unchained, WienerAI, and PlayDoge.
Typically, shitcoins are created by unenthusiastic founders, who lack the appropriate experience, financial backing, and technical expertise, which allows the cryptocurrency to easily be replicated. However, despite the range of downsides and risks closely linked with purchasing any shitcoin being substantial, it has not deterred millions of speculative investors internationally from purchasing their share of coins in the hope of obtaining rapid, sizable, and even life-changing returns.
What Is The Best Way To Identify A Shitcoin?
Despite the potential that shitcoins may have, it’s also necessary to accurately differentiate them from generalized, mainstream, or other forms of cryptocurrency. While, instantly identifying a shitcoin can be a difficult process at the best of times, and especially so for any newcomer, there are four distinct characteristics to look out for.
Firstly, shitcoins are known for their distinguishable lack of practical and real-world use cases or purposes, making their tangible and intrinsic value highly speculative. Secondly, most shitcoins do not possess an acceptable whitepaper or financial roadmap. Usually, entirely legitimate cryptos should provide an official whitepaper and detailed roadmap, outlining their initial goals, future ambitions, accompanying technologies, and overall credibility. Any cryptocurrency that cannot immediately provide a thorough roadmap or an official business whitepaper should be considered a shitcoin, meaning any potential, speculative investment should be pondered
Thirdly, most shitcoins do not have an effective development team behind their name. Anonymous individuals or inexperienced teams quickly develop many shitcoins, with a notable lack of transparency frequently being one of their accompanying features. As is widely accepted, all reputable cryptocurrencies will present their team of developers as a source of pride and transparency, making the lack of a credible development team an obvious indication of a shitcoin.
Lastly, cryptocurrency coins impacted by types of pump-and-dump schemes are often shitcoins. These may be pushed beside other fast-moving technologies like AI or advertised in ways that lure investors to invest as much as possible within a short period of time. Any cryptocurrency sporting a remarkably high initial asking price, usually artificially inflated and which dramatically crashes a short time afterward, can be considered a shitcoin and should be avoided if at all possible.
Why Do We Invest In Shitcoins?
Despite their risks, shitcoins remain attractive for speculative crypto investors for a few key reasons. The fundamental reason for investing in various shitcoins is their obvious potential for high substantial short-term financial gains, with some people obtaining life-changing sums of money almost overnight. While the volatile nature of shitcoins makes them a risky investment, these same characteristics also can make them among the most worthwhile investments possible.
At the same time, people list low entry costs, social media hype, and the fear of missing out as the main reasons for investing in risky shitcoins. It is known that shitcoins are among the cheapest cryptos we can purchase, enabling small-time investors to purchase significant quantities of the coin without a significant upfront capital investment.
Moreover, as is often the case with traditional forms of investing or purchasing mainstream cryptocurrencies, the fear of missing out and social media hype about the coin can drive people to invest in various shitcoins, with this being especially true when others are generating significant monetary returns from the same coin they showed interest in.
What Are The Risks Of Investing In Shitcoins?
Investing in shitcoins comes with high risks, and potential investors should be aware of these before making their decision. The overwhelming risk associated with any shitcoin is their high volatility, meaning their prices can skyrocket one day and plummet the next, making them highly unpredictable.
Furthermore, shitcoins are exposed to an extreme number of scams and fraud, which coupled with a notable lack of liquidity often proves a significant hurdle for investors aiming to rapidly increase their net worth. Finally, the regulatory risks and global trends of shitcoins are not something to be frowned upon. This is additionally true in 2024, where regulators globally seek to crack down on cryptocurrency as a whole, making most shitcoins particularly vulnerable.
Conclusion
Shitcoins represent a high-risk, high-reward segment of the cryptocurrency market. While they can offer exciting opportunities for speculative gains, they also come with significant risks. However, with sufficient research and a healthy appetite for risk, shitcoins remain among the best speculative investments currently available to the public.
