Many people always ask me how this coin is, how that coin is, whether they can buy it, and how much it can increase?
I will write an article today to systematically answer this question.
Here we only discuss coins that can be held for more than 3-5 years.
This does not include trading coins that are only held for a short period of time based on hot narratives.
First of all, I think it is too difficult to make money through trading, and I don’t think it is necessary for most people to go down this path.
Moreover, the road to trading is not something you can learn by reading a few articles or taking a few courses. You must go through a lot of actual losses.
Having seen money and lost money, the only way is to temper your mood and cultivate your character. I will not elaborate on trading here.
If a coin can rise and be recognized by the market, first of all, its demand must be greater than its supply. In addition to emotional speculation, if this coin can be voted by a large amount of funds, then the money must be smart. If the money can go there, it means that this coin is recognized by the market.
There are several conditions for a coin to really rise in the long term.
First, the total amount of this token is limited, and it is best to be deflationary.
Second, this token has a large number of usage scenarios.
Third, the token project is sustainable and can always maintain its first-mover advantage.
There is no reason why such a coin should not rise.
For example, BTC, ETH, and BNB all meet these three conditions. That’s why they can rise so high.
Among these three, BNB's usage scenarios are gradually shrinking, because centralized dex will be gradually replaced by decentralized projects in the next 5-10 years, and the ecosystem on the bsc chain will also be replaced by more decentralized projects. BNB's usage scenarios are also gradually weakening, and the income from each new issuance is gradually decreasing. This compensation mechanism that relies on exchanges giving money will eventually fail to persist.
So you can make money from cyclical sentiment on BNB, but to make money from long-term development, it depends on the sustainable development of the projects and ecology behind it.
If this cannot be maintained, the development of BNB will also be hindered. The inevitable result of not being able to grow will force smart holders to switch to a path that can grow.
For example, uni meets condition one, but not conditions two and three. If one day uni can become useful, such as being able to participate in dividend staking, enabling the listing of coins, and having no rivals in the field of dex, then it is just around the corner for uni to surpass bnb in market value. But it has not yet done so. Many people buy it and institutions hold it, precisely because of the expectations of the latter two.
As for Uni not meeting the second and third criteria, it is because it is still too weak and does not have the strength to compete head-on with institutions such as the SEC. Its technical advantages have not completely monopolized the DEX market. There will definitely be countless capital institutions that will do DEX in the future, and Uni will definitely be under great pressure. It is difficult to determine whether it can maintain its advantages and build a strong moat. Therefore, its market value has not been so strong, and the price of the currency has not exploded. This is the fundamental reason why its price has been sluggish.
Although many people are not optimistic about it, I am extremely optimistic about it. The main reason is that it is focused enough on the dex issue.
I often imagined that uni would eventually soar to fame.
This is certainly not investment advice, it's just my opinion. I just prefer uni, that's all.
I am talking about a coin here, such as Link. This coin is parasitic on the takeoff of DeFi. It is a data-oriented coin. You can think of it as a data intermediary company that allows real data and on-chain data to communicate with each other.
We can imagine that the DeFi field must have very bright prospects. Pledge, lending, trading, gambling, etc. all rely on the feeding of real information data.
Although Link does not have passive deflation, the total amount is limited. As for the use cases, there are too many. Companies that provide data must use Link coins, and projects that accept data must also provide Link coins. If the provider of the data costs money, Link will be confiscated. It can be said that it meets a large number of use cases. It almost monopolizes the oracle market.
Link has another advantage, which is that it is fully circulated without unlocking. In other words, the current market value is the real market value with full pricing.
Defi was developed in 2020, it has only been 3 years, and it is still a bear market.
It can surpass the market value of uni because it is truly useful and will continue to grow
There will be no problem for on-chain lending transactions and data usage to reach a scale of 10 trillion US dollars in the future.
The entire market is only one trillion US dollars now.
So based on these conditions, how much can link rise in the next bull market? I personally think it will start from 20 times.
I have no reason not to hold it. I think people in the cryptocurrency circle and those who play DeFi should study this project carefully.
Buy a coin.
The point of being useful is very important, whether it is useful in the short term or in the long run.
Usefulness is the most core factor in determining the performance increase of the currency price.
I think even if you are speculating on coins that are based on sentiment, such as blockchain games.
In the short term, this coin must have a usage scenario, only then will it rise sharply.
Only when this certainty exists can its currency price explode rapidly.
And a useless coin, which depends entirely on emotions and cycles, will greatly increase the weight of luck.
The only thing we can't control is luck.
