The world of digital currencies is fascinating and diverse. Currently, there are around 10,000 different cryptocurrencies, each with its own purpose and key features. This means that any user looking to invest in crypto can find the coins that best suit their needs.
Launching a new digital currency is straightforward nowadays. No wonder, crypto fans take advantage of it. As a result, new currencies pop up almost daily. However, not all of them manage to stay afloat for long; many vanish from the scene as quickly as they emerge.
In this article, we will explore how digital coins come into existence and how to evaluate their potential from an investment perspective. We will also discuss the types of digital currencies, their key features, and the pros and cons of investing in new cryptocurrencies.
What is сryptocurrency. What types are there?
Digital currencies exist only in virtual form and have no physical representation. They cannot be touched or seen, yet people worldwide buy and sell them daily, investing their capital in them. So, what is this instrument, and what types are there?
The first cryptocurrency ever invented is Bitcoin. It still holds its leading position and is a distinct type of digital coin. All other coins that emerged after it are called altcoins, meaning alternative coins.
They are named this way because they were created based on Bitcoin's code. One example of such a coin is Litecoin. Subsequently, other coins with unique codes began to appear. Cryptocurrencies also serve different purposes:
- Payment currencies can be used to pay for goods and services. In addition, they can be viewed as investment or trading assets. The most well-known and popular among these currencies is Bitcoin.
- Functional platform coins are used to perform specific tasks on the blockchain. One of the most notable examples is Ethereum, which enables smart contracts, applications, games, and much more on its platform.
- Internal tokens of trading platforms are issued by decentralized exchanges and are used to pay fees and commissions for transactions. Examples include Binance Coin (BNB) and EXMO Coin (EXM).
- Utility tokens are currencies issued in limited quantities to attract investments for a project. Later, such tokens become governance tokens, allowing holders to participate in project management through voting, for instance, the UNI tokens from the Uniswap project.
- Stablecoins are pegged to a physical asset and have a value equal to it. A prominent example of such currency is Tether (USDT), which is tied to the US dollar, with a price deviation of no more than 1%.
- NFT tokens are deciphered as non-fungible tokens, each of which is unique and has its own price and demand. NFTs are issued for items such as artwork, musical works, characters from blockchain games, and much more.
New cryptocurrencies
The history of digital currencies began with Bitcoin, which has not lost its position to this day. When was Bitcoin designed? It was around 15 years ago, in 2009, and at that time, nobody took it seriously; users mined it for fun and scattered thousands of Bitcoins on small purchases.
Had they known the highs the BTC price would reach, they would have handled them differently. Currently, the price of 1 BTC is nearly $70,000, a significant amount. Not all investors have such a large starting capital to buy even one Bitcoin.
At the same time, many see the potential of digital currencies for multiplying their savings. So, what should they do? How can someone start profiting from crypto without large sums for initial investments? The answer is simple: invest in new currencies that are just entering the market and are not traded as high as Bitcoin.
Nowadays, new coins and tokens are introduced to the market almost every day. This is because launching a new coin does not require tremendous effort; it can be done using special programs and templates based on existing blockchains.
Coins that are issued on their own blockchain are referred to as coins, while those released on external chains are called tokens. The key differences between coins and tokens are outlined in the table below.
| Parameter | Coin | Token |
| Blockchain | Based on its own blockchain | Based on an existing blockchain |
| Purpose | Used as currency | Performs a useful function |
| Creation and distribution | Mining (typically through mining) | Bought for fiat money or other cryptocurrencies, also distributed via ICOs |
| Usage | For financial transactions | To perform functions within a project, such as voting |
| Currency examples | Bitcoin, Ether, Litecoin | AXS (gaming token), Dogecoin (meme token), UNI (Uniswap exchange token) |
How new cryptocurrencies created
So, how do new digital currencies come into existence? Who creates them, and how? Let’s explore. When cryptocurrency first emerged, most people had no idea what it was or how blockchain technology, which underpins all digital coins, worked.
A key characteristic of blockchain is its decentralization. This means that it, along with the currency based on it, is not controlled by any single government or organization. As a result, the value of any given digital currency is determined by supply and demand.
We previously highlighted the difference between coins and tokens. Developing coins is much more complicated than creating tokens, as the former requires the establishment of a new blockchain, which, in turn, demands much more technical skills, time, and financial resources.
Creating a token requires less effort since ready-made platforms are used. The main task is to choose a reliable blockchain with a good reputation, as this will immediately boost the new currency's rating. Additionally, it's important to understand the purpose of the token—whether it will have practical applications or is merely for fun.
Interestingly, many tokens initially created just for amusement later gained immense popularity now occupy top spots in cryptocurrency rankings. This refers to "meme tokens," which originated from internet memes—humorous images featuring various characters.
Beyond the concept and purpose, it is essential to determine the token standard—BEP-20 for tokens based on BNB Smart Chain and ERC-20 for coins on the Ethereum chain (supported by most crypto wallets), as well as the consensus algorithm (PoS or PoW) and other details.
All these chains allow for the development and customization of smart contracts, which enable the creation of new tokens and decentralized applications (DApps). Using such applications, a user can create an entire ecosystem that offers more usage and functionality for the coin.
How to learn about new currency releases
Once we understand the mechanisms of creating digital currencies, be aware that you can profit without creating your own currency—simply by investing. Next, we will discuss where to track new cryptocurrencies and how to evaluate their potential.
New cryptocurrency projects emerge daily, but not all of them last even a year. However, investing in cryptocurrency startups can be highly profitable, as it has the potential to yield hefty returns. So, how and where can you find information about new digital coins entering the market?
To do this, you need to understand the algorithm for a cryptocurrency's market entry, which involves several key steps:
- Creating a project account on social media. For the cryptocurrency industry, the main social media platforms are X (formerly Twitter), Discord, and Telegram. Additionally, information about new currency releases may be posted on specialized forums. The goal is to attract as many people as possible.
- Listing on specialized aggregator platforms. For a currency to appear on such platforms, it must undergo a listing procedure and authenticity verification. Notable platforms include CoinMarketCap, CoinGecko, CryptoRank, and others.
- Launching on an exchange. Cryptocurrencies can be traded on both centralized (CEX) and decentralized exchanges (DEX). When launching a coin on a CEX, it must undergo an ICO or IEO procedure, akin to an IPO in the stock market.
To stay updated about new digital currencies, you should monitor social media and forums. However, you should be aware that such platforms may also contain information about scams. A more reliable method is to search for currencies on specialized platforms or exchanges, as coins undergo authenticity checks before being listed on these platforms.
How to evaluate potential of cryptocurrency
The next crucial step in finding a digital currency for investment is assessing its potential. How do you determine which cryptocurrency is the most promising? This section will discuss the analysis required across several key parameters:
- Technological basis. It’s important to evaluate the project's technological aspects, including what functions it will perform or which problems it will solve. The potential for scalability—expanding the network size without losing decentralization and security—is also crucial. This category includes the consensus algorithm, mining methods, and other factors.
- Development team. The individuals behind a currency should not be anonymous. If information about the developers and their backgrounds is unavailable, this may indicate dishonest intentions or fraudulent schemes.
- Market capitalization. This aspect helps assess how large and liquid a new crypto project is. The more investors it attracts, the higher its ranking will be. A rapid rise of a new currency suggests serious potential in the eyes of investors.
- Partnerships and investors. It’s essential to examine whether the project has partnerships with other companies, as these help attract new resources and strengthen positions. Additionally, attracting large and well-known investors indicates a good reputation and trust in the project.
- Community. The support of a strong and loyal user community significantly increases the chances of success. Such a community is interested in the project's further development and actively participates in its activities.
Analyzing each digital currency—especially if it is new—requires meticulous attention to all aspects as a whole. It’s crucial to find and review the project's primary document—the white paper—which outlines the key technical specifications of the currency as well as plans for its future development.
The potential for growth in new cryptocurrencies can be enormous, making them very appealing to investors. However, it’s important to consider not only the potential profit but also the risks associated with investing in new projects, which we will discuss in more detail in the following sections.
Advantages of investing in new cryptocurrencies
Let’s start by discussing the advantages for investors when investing in new currencies. If you can accurately predict which cryptocurrency will grow and invest capital at the right time, you can become wealthy in a short period. Of course, it's not that simple, but investors often place high hopes on new projects, and the cryptocurrency sphere is no exception.
So, what are the key advantages of investing in new cryptocurrency projects? The first and foremost advantage is the low cost. Initially, when a currency is just entering the market, it is priced low to attract as many users and, consequently, funding as possible. Even Bitcoin was worth only a few cents at the beginning.
Thus, initial investments can be quite small, while the potential returns can be substantial. By following recommendations for analyzing and selecting digital currencies for investment, you can multiply your initial contribution several times over.
The second advantage is the innovation of the projects. Cryptocurrencies themselves are a relatively new tool with immense potential for use in the global economy, not only as a means of earning but also as a payment method. However, they can also have other practical applications.
Many cryptocurrency projects have a social focus, as blockchain technology can be utilized not only in finance but also in other fields such as healthcare, document management, logistics, and more. Therefore, by investing in such innovative projects, an investor can enhance their reputation and credibility.
The third advantage is the variety of investment opportunities. Given the sheer number of new cryptocurrency projects emerging, each investor can choose those that align with their goals, capital size, and risk tolerance.
Risks of investing in new cryptocurrencies
Despite the attractiveness of cryptocurrency projects, it is essential to consider not only their advantages but also their drawbacks. What if, after investing, there is a sudden drop in the value of the cryptocurrency? To avoid losing your savings, it is crucial to understand and account for all risks.
The primary risk with new cryptocurrency projects is the possibility that they may turn out to be scams or fraudulent schemes. In other words, no new currency is actually released; only the appearance is created to swindle money from users. This is why it's vital to verify coins on various services to ensure they genuinely exist.
In addition to fraudulent schemes, there is another risk with the launch of new currencies: the coin may never gain traction, meaning it might not deliver the expected or promised returns. As we have noted, not all cryptocurrency projects manage to survive for a year or longer; many "fizzle out" shortly after a bright rise.
The third problem is the low liquidity of new coins. Typically, they are not yet well-known in the market, making it challenging to sell such coins when necessary, unlike more established and popular coins. This also affects their volatility and slippage, i.e., the difference in price at the time of buying and selling.
The fourth issue is the possibility of manipulation by developers. Some digital currencies are launched with centralized distribution, where a significant percentage falls into the hands of one or a few individuals. Consequently, they can influence the asset's value.
The fifth problem is the lack of insurance. Investments in cryptocurrencies are not protected by insurance, unlike bank deposits, for example. Therefore, in the event of company bankruptcy, a hacking attack, or any other misfortune, there is no one to compensate the investor for their losses.
Recommendations for safe investing
Now that we have reviewed the advantages and disadvantages of investing in new cryptocurrencies, let’s discuss recommendations for minimizing risks and ensuring safe investing before deciding which cryptocurrencies to buy.
To manage risks effectively, the following steps should be taken:
- Educate yourself. Before entering the crypto market, it is essential to understand how it works, how to analyze it, what digital currencies are, the technology behind blockchain, and more.
- Set clear goals. Define the investment timeframe and the profit you expect to achieve during this period, taking all associated risks into account.
3. Diversify your portfolio. A fundamental principle for any investor is: "don’t put all your eggs in one basket." You should distribute your entire investment capital among several cryptocurrencies, as investing all your money in a single asset is too risky.
4. Conduct a thorough analysis. Before investing in crypto assets, perform a comprehensive analysis using various tools. For long-term investments, it’s crucial to consider liquidity, market capitalization, and trading volumes.
5. Evaluate and mitigate risks. It’s not enough to understand the risks associated with investments; they also need to be minimized. Tools to reduce risks can include setting limit orders, employing hedging strategies, and purchasing futures, among others.
6. Monitor your portfolio. Keep track of important news or events that could impact digital currencies. Regularly check the status of the assets in your portfolio and rebalance as necessary.
7. Use secure storage methods. For long-term storage—when the assets are not needed for daily transactions—it’s best to keep them in a "cold" wallet. This type of device, similar to a USB stick, is not connected to the internet and, therefore, less vulnerable to hacking attacks.
8. Maintain discipline and stick to your strategy. In investing, as in trading, it’s important not to give in to emotions and to make decisions with a "cool head." The two main emotions that hinder success in financial markets are fear and greed.
9. Be patient: Investing is a long-term game, and it’s impossible to see the results of your efforts quickly. However, if you do everything correctly, the results will eventually come.
Which currencies to invest in
Every investor has their own views and capabilities regarding how much money they can and want to invest in digital currencies. Some look for more expensive and well-known coins, while others try to determine the cheapest cryptocurrency and whether it has any growth potential.
For those just starting out in cryptocurrency investing, it’s essential to test the waters with small amounts. Beginners can practice opening and closing trades on a demo account, where trading is done with virtual rather than real money.
Once they gain some experience and understanding of how it works, they can start trading on a live account. However, it is advisable to start with small amounts, and for this purpose, low-cost digital currencies are ideal.
In contrast to Bitcoin and some other popular currencies priced from a few thousand to tens of thousands of dollars, there are coins priced significantly below $1. Anyone can purchase a certain amount of these coins.
Among the most well-known inexpensive digital currencies are BitTorrent, Shiba Inu, Gala, Tron, and others. Each of these projects has decent growth potential, making them worth considering for investment.
In any case, before investing in any digital currency, it is crucial to conduct an independent evaluation of the project behind it, the development team, and other factors that may influence investment decisions.
Most popular cryptocurrencies
As mentioned, digital currencies appear almost every day, but not all of them manage to establish themselves in the cryptocurrency rankings, and some disappear almost as quickly as they emerge. For this reason, many investors are hesitant to invest in new currencies, fearing they might lose their capital.
Consequently, the most popular cryptocurrencies continue to be in high demand among users. We have already discussed the criteria to consider when selecting a digital currency. Many currencies increase in price due to "hype," which can arise from news about their developers, investors, scandals, or rumors.
For example, the Shiba Inu coin suddenly gained popularity thanks to a post by Elon Musk on Twitter about buying a Shiba Inu dog. Users who read the post mistakenly thought it referred to a new cryptocurrency and rushed to buy it en masse.
The same can be said for other meme coins, such as Dogecoin and Pepe, which originated from internet memes—humorous images. These cryptocurrencies were created merely for entertainment and do not provide any real utility. Nevertheless, they enjoy popularity and occupy top positions in cryptocurrency rankings.
Other currencies gain popularity through projects where they serve as utility tokens. Blockchain games are becoming increasingly sought after, each featuring its own currency used for purchasing characters and other items.
Another example of a digital currency surge is Toncion, developed by the team behind the popular messaging app Telegram, led by Pavel Durov. Even though the team was forced to abandon further development of the project under pressure from US authorities, crypto community activists continued to work on it, allowing the currency to maintain its popularity.
New cryptocurrencies in 2023
Volatility is one of the key characteristics of all digital currencies. This means their value can change significantly over short periods, even within a single day. The most volatile cryptocurrencies are primarily of interest to traders rather than investors.
This is because traders engage in numerous short-term transactions. Unlike investors, they can profit from both rising and falling market quotes. In the first case, they open long positions, and in the second, short positions.
However, it is important to understand that executing such quick trades requires a significant amount of knowledge and experience. Otherwise, one could quickly lose their entire deposit without earning anything. It’s crucial to recognize that all financial speculation involves high risks.
A characteristic of new digital currencies is that they can experience more significant price fluctuations than coins that have been trading for several years. The value of some currencies released in 2023 has changed by dozens or even hundreds of per cent within the year.
Overall, 2023 has been relatively successful for digital currencies, many of which have demonstrated decent growth. The NFT token sector has particularly attracted attention, with new players entering the market. Additionally, ApeCoin—a token tied to the well-known NFT collection Bored Ape Yacht Club—was released.
Another interesting project is AiDoge, designed for meme creation using artificial intelligence. Within a month of its launch, the developers managed to sell all tokens and raise $14.9 million even before listing on exchanges.
New cryptocurrencies in 2024
Continuing the discussion of new digital currencies, let’s look at some coins that have emerged this year. According to experts, a rise in the cryptocurrency sector is expected, so we can soon anticipate upcoming listings.
For now, let’s talk about new currencies that are already trading on exchanges. The developers of the projects PlayDoge and Sealana have incorporated interesting ideas into them. In the first case, it is a play-to-earn game where users can play and earn crypto, created similarly to the once-popular Tamagotchi game.
As for the Sealana project, it is a meme coin created on the Solana platform. The main character’s prototype is taken from the well-known cartoon "South Park"—a chubby seal that increases in size based on the amount invested in it. The currency features a low price and an excellent development team.
Two more meme coins launched in 2024 are WienerAi and Base Dawgs, both featuring dogs as their main characters. The first project offers an AI-based assistant for trading digital currencies, while Base Dawgs is a multi-chain coin that can switch between several blockchains.
The 99Bitcoins project is a platform with a Learn-to-Earn (L2E) technology that allows users to earn while learning about digital currencies. Users are rewarded with the project’s own currency for their efforts to study cryptocurrencies.
Another interesting and relevant project is eTuktuk, aimed at ecological initiatives in the transport industry. Users can purchase the project’s currency and stake it, receiving rewards in return.
New cryptocurrencies likely to surge
When it comes to new digital currencies entering the exchanges, it is quite challenging to predict which ones will demonstrate strong growth. However, if you understand what factors influence cryptocurrency prices and how they change, you can gauge what lies ahead for them.
The primary factor determining the value of any coin is supply and demand. If demand for a currency increases while supply remains limited, its price will rise. For some currencies, such scarcity is created through various techniques, such as burning a portion of coins during their use.
Market sentiment, meaning investor sentiment, also influences currency prices. Each asset experiences periods of fear and greed. During fear, investors refrain from buying, especially cryptocurrencies, which are considered high-risk assets. In periods of greed, they are more willing to buy indiscriminately.
Another important factor is competition—new cryptocurrencies strive to outperform their rivals on various parameters. Modern blockchains are capable of providing higher transaction speeds and lower fees, thereby attracting new users.
Regulatory risks are another factor to consider. Cryptocurrency transactions are not permitted in all countries, which creates additional risks for investors. However, increased regulatory pressure on centralized exchanges heightens the appeal of their decentralized counterparts to users.
Lastly, the reputation of the cryptocurrency is crucial. Digital currencies are not backed by any physical assets, so their reputation relies solely on user trust. The greater the trust in a particular currency, the better its position can be.
In any case, when considering new cryptocurrencies for investment, it’s advisable to choose the most liquid ones and execute trades during periods of peak popularity. Otherwise, it may become more difficult to sell them later, and transaction fees may exceed the size of the trade itself.
Conclusion
In this article, we explored key questions regarding how new cryptocurrencies emerge, as well as how to assess their potential from an investment perspective. It’s essential to pay attention to factors such as the development team, community, partnerships, and market capitalization, among others.
Before investing capital in digital currencies, one must consider all potential benefits and risks. The main advantage of investing in new currencies is their low starting price and high growth potential, which can yield good profits. The primary risks are associated with fraudulent and failing projects that do not achieve further development.
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