Cryptocurrency is sometimes referred to as “Internet Money” or “Money 2.0” with Bitcoin being the main example. However, there are far more cryptocurrencies available than just Bitcoin but it helps to know about them or at least the cryptocurrency market in general if one was planning to invest money into this technology.
So what makes a cyrptocurrency successful and flourish? High level crypto-community members everywhere agree on 7 key points that determine if a cryptocurrency will succeed.
Every cryptocurrency creator has a plan, most of the time the plan is focused around high technology, and/or sophisticated features. It is recommended that you know the cryptocurrency creator’s vision for the cryptocurrency even if the developer is no longer personally available. A supportive community should be able to articulate a clear vision for the currency.
Eecentralization in the cryptocurrency industry essentially means: ‘no central point of responsible’ however to some it means: ‘many are independently willing to accept responsibility’. Responsive, accountable, and transparent are character traits often used to describe good caretakers of a currency.
All of the people directly involved with a cryptocurrency including: the creator, administrators, investors, supporters, anyone that uses the cryptocurrency, watchers/trackers/followers of the cryptocurrency, regular contractors for the cryptocurrency, including the uninvolved supporters (endorsers) of the cryptocurrency should be considered part of the cryptocurrency’s community.
Some good sign of a healthy community is daily interaction, regular update of meaningful content, some form of leadership, a healthy mix of membership tenure, respectful interactions, and a growing membership.
Structure & Security
In the cryptocurrency universe centralization is a bad word, however whenever a major upgrade is needed or the market rate for the cryptocurrency takes a disappointing turn investors are always looking for someone to “handle it”. Foundations, elected leaders, and/or individuals who ‘step-up’ to assume leadership roles are stabilizing forces for a currency.
At every point in the development of a currency security is vital, safety enables a currency to be able to grow into a strong currency.
Purpose & Productive Performance
A cryptocurrency should have a well articulated purpose, after the code is written, community gathered, and allocations made. At some point a currency must perform as a currency otherwise it is a commodity, or worse a space holder. Productive performance means it has an articulated purpose and is visible, recognized, and woven into the culture.
Utility refers to a currency’s usage. Another way to think of it is “application.” as in how will this cryptocurrency be used? Between ‘purpose’ and ‘performance’ is ‘adoption’, adoption of a currency often refers to merchant acceptance or willingness to accept a currency.
Many times cryptocurrencies create for themselves a niche market eg: gaming industry, science research industry, medical.
Meaningful Drive refers to marketing and outreach that enable you to provide your target audience with additional perspective or detail. This is in contrast to irresponsible hyperbole or rhetoric.
Cryptocurrency is a complex subject, those who are responsible for promoting a currency should be willing to explain every detail to you in terms that you understand.