Ok, you trade in crypto, invest in crypto or want to do so. How do you invest in profitable Altcoins?
We discuss the strategy that profound investor Lark Davis uses to pick Altcoins with a potential of 100X return on investment.
Of course there are a lot of people trying to lure you into shady ‘easy money’ project. Therefore we first look at who Lark Davis is.
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Who is Lark Davis?
Lark Davis is a New Zealand based crypto trader and investor. He is know for his YouTube Chanel ‘The Crypto Lark’. This channel, which is active since 2017 has 232.000 subscribers from all over the world. He is renown for his combination of humor and ability to spot chances in an early state.
What are his tips to spot potential profitable Altcoins?
In short, Davis provides us with 5 tips to spot hidden ‘gems’ in Altcoin investment opportunities. Of course we share them.
1. Focus on market capitalization
The first tip is to dig into market capitalization. His point of view is that when the market capitalization arises above $ 10 million dollar, the opportunity of 100x profits is gone since they are to big for, as he calls it, ‘crazy profits’. Of course the low market capitalization alone is no guarantee.
2. Look for strong fundamentals
When looking at coins with a market cap below $ 10 million, the way to separate the wheat from the chaff is to perform fundamental analysis. When the outcome provides strong fundamentals you’ve spotted Altcoins to keep an eye on.
3. Buying tokens (without holding obligations)
Large profits are to be found in token sales. Especially Defi tokens can provide large gains. This can be seen when we look at the year-to-date results of Altcoins as of ultimo February. However, some tokens are only buy-able when you commit to a minimum holding period. According to Davis you need to avoid those obligations, which can be very costly.
4. Do you spot any ignored projects?
Another clue for finding Altcoins with a high return on investment is looking for ignored projects within the boundaries as set before. Some coins are under-valuated. This means that the potential user case (other than Defi, since Defi is already trending) of a certain coin justifies a much higher price than is currently noted on exchanges. A good example is VeChain (VET).
This blockchain project is designed for authentication of all sorts of products. Due to registration on the BlockChain Nike sneakers can be traced back to the original owner. Other user cases are the registration of production chain of food products. So consumers can check whether their ‘biological’ meat is indeed biological or their Champagne wine is a genuine Champagne. After prices moved within a multi-year Bolinger band the price is breaking out and the coin is tipped to be bullish for hundreds of percents. You can find more information about VeChain (VET) on our coin page.
5. Look out for maximum potential
As a final tip Davis suggests to look beyond the current state of a project behind a coin. When the fundamentals are good and potential beyond the current state of the project is large, there is a good possibility to earn large return on investments on certain Altcoins. As an example Davis mentions Polkadot (DOT), a cryptocurrency which has seen a huge rise of price while their project doen’t have a full mainnet at the moment.
In the video below Davis shares his full thoughts.
Of course we have to keep in mind that a return on investment is a reward for risks taken. It’s logical that in this segment of the market risks are higher and the market can be uncertain.
Are you curious about how to trade in uncertain circumstances? We have provided you with 5 tips.