Outsider Club’s Weekly Reader Question
“I’m looking at these cryptocurrencies and for the life of me I can’t tell what the difference between them. How can I tell the good from the bad?”
— Brian W.
NICK HODGE | Founder
Short answer: Bitcoin’s the king and Ethereum’s the prince. Everyone else is a serf or a joker.
The longer answer, of course, is a bit more nuanced but still reaches the same conclusion: Bitcoin is king. It’s the most talked about, the most sought after, and the most used. So that’s the one I would focus on.
But as I’ve been telling you for the past few weeks… the crypto mining game is advancing very quickly. Major companies are now getting involved.
Facebook just released one called Libra that has everyone talking. But from the early recon I’ve done, it looks like Libra will be a “stable coin.” Those who are much smarter than me in the space are saying Libra will have to buy Bitcoin to be effective.
People smarter than me are also figuring out how to mine Bitcoin at a constant profit. They are figuring out how to monitor the price, hash rate, and other factors so that they only have to turn on their crypto mining machines when they are profitable. And if another coin is more profitable than Bitcoin to mine at any certain time, they can switch.
It’s called Crypto66. And it lets you get in whatever cryptos are most popular at any given time for less than $1.00.
JASON SIMPKINS | Editor
You’re not alone! There’s almost too many to count, and it’s hard to tell the difference. However, I did write a guide of the biggest that you can find here on our website. It explains everything you need to know about the big ones — Bitcoin and Ether — and even details some of the smaller additions like Litecoin, Dash, Quarkcoin, Ripple, and others. It also explains how you can invest. I’d start there.
ADAM ENGLISH | Editor
There are two big facets to look at here — the cryptocurrency itself and how it trades.
When looking at a cryptocurrency, you will want to check off a number of boxes. You probably want something that has been around for a while, unless you want to take an even bigger risk that it’ll fold.
You’ll want one that is not under control of any one entity or group of people. The team or community behind it should be active and transparent and the coin itself should probably have some use besides just existing as an experiment.
On a related note, you’ll want one where the people who made it didn’t give a whole lot of it to themselves.
It should have room to grow and be actively traded. You’ll probably want one with an offline wallet too, so you aren’t exposed to hacks.
As for how it trades, you want one where it is easy to enter and exit positions, it is listed on a number of exchanges, has plenty of volume, and — of course — has room for the price to go up.
It isn’t easy trying to isolate one or a couple of cryptocurrencies to invest in. That’s why many people stick to a handful of the big names: Bitcoin, Ethereum, Monero, Litecoin, etc.
Increasingly, investors are getting access to new ways to get into cryptocurrencies as well. Nick knows all about that.
To learn more about our editors, visit our website. And keep an eye on your inbox for Gerardo’s (Mondays), Adam’s (Tuesdays), Nick’s (Wednesdays), and Jason’s (Fridays) weekly articles.
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