I always look for new coins to find the ones with potential. We are talking about coins of all kind POW only, POS only and hybrids. The so called fact bellow are based on my experince, feel free to share you views.
Let`s see the pros and cons of each type in general.
cons: If you don`t have the hashpower mining is off the table, especially with "easy" algos ASICs are taking over. The network can get centralised quite easily, if a pool grows too big. (see early phase of Poly) Network difficulty can rise high make it hard and inefficient to mine. (see bitcoin,litcoin etc...) pros: More circulting coins on the market, more affordable to get them on stock exchanges, so you can buy yourself a nice share. The dev team has a bit lesser impact on the coin itself, even if the coin is premine. This makes the coin more reliable, smaller chances of coin goes bust.
cons: The only thing matters is your capital, if the coin is PREMINE: be CAUTIOS, chanses are the dev team is geady and will get most of the stakes from POS and centrelasies the network. Worst case they are scammers. Lower amount of circulating coins, makes it harder to get it on exchanges and makes it more expensive. POS pools just like POW pools can centrelise coins network. pros: It is much harder to centrelasie the network (except if premine), as it is rather and expensive (if not impossible) to buy 51% of all coins generated. It is more efficient, than GPU or ASIC mining. Futureproof
cons: pools can ruin a network POW and POS, but on a hybrid coin this effect can be even worse, as the biggest POW pool could easly get 51% of stake in POS. If premine AVOID it. Because of stacking is harder to buy coins. pros: The safest from the 3 options, smaller ASIC effect, network difficuly gonna be lower mining is more efficient, than POW only. Probably this is the future of most of the cryptos on the market.
Let me bring some examples here:
I`m actually invested in GMC bought coins qutie cheap. My experince with GAME is they spend most of there funds on marketing rather than improvements. Sponsoring e-sport teams, trying to get game developres to publish on thier platform instead of steam for instance. Dont get me wrong here, they are working on implementing the coin, but their real focus is on marketing. This makes the coin more growin with the "hype". Im curious what will happen when the hype ends, just like bitcoin. The thing is I cant really do anything with the coin, im just waiting for it to grow. I have zero impact on it. They coin is not realiang on the community its literally just the dev team.
POLY: even though this is hybrid coin in this phase is POW only. And see this is the exact opposite of GMC. As the dev trying to get the community together, you can actually have quite big impact on your investment and we arent in POS phase yet. No premine means and no ICO means a fair start.
Miningwise it was a good start, even with my old gtx960 I could managed to recieve a fair amount of coins. But after a couple of days Suprnova took over the network, but the communtiy decentralised the coin pretty quick with great guides and suggestions. This is a big plus, as most coins can`t handle 51% takeovers.
The first project master nodes are a clever choise. The dev team can raise some funds, but so does the community in the same time, meaning the dev team has funds to spend on improvements and the they earn the trust of the community in the same time. (The most decent way of conducting bussines IMO). Eventough I have only a little invested in POLY, I seriously have a good feeling about it as Im not investing for quick profit. The community projects are pushing me to learn new things every day, even if I dont see money from POLY it already worth it, just for the knowledge.
XP coin, altough it is a hybrid sort of coin POW phase ended a while ago, so is more likely POS only coin now. I just recently invested a small amount in XP. If you only have a little amount there is no chance to stake your coins, but for this exact reason the community created a stake pool. Right now the pool is not centrelaising. for me it works like charm, on my ~15k XP worth around $45, I stake around 30-40 coins a day. It looks like a good long term investment, plus I dont need to stake my coins myself, no need to have the wallet online 24/7, and yet I still have a little impact on my investment.
There is not much to do with it just wait.
Sigil (SGL): Well this coin is a prime example of greed/scam or bad way of conducting bussines.
They just launched a few days ago with POS/POW system (PREMINE). Turned out the dev team is steaking thier premined coins, make it impossible to anyone else to gain anything. They have been warned about this on forums, they appologised and promissed not to stake the premined coin. Guess what, they still do...
Coin went on exchange after 1 day. Devs are probably going to dump thier premined coins and dissappear in the thin air.
POW-wise, they had a dev pool with 10% fee. well noone mined there. Suprnova have 90% of the hashrate, Coin got forked 1 day after launch. Dev pool went down to 0% fee to balance, for 2 days it worked fine. In the meantime Suprnova gave up on the coin (that doesnt happen every day), balances went missig an so on. On dev pool is still 0% fee however 90% of miners got much lower than their actual hashrate. We are talking about 60-70% less, than it supposed to be. My example 360-380kHash/s hasrate on pool 80-120kHash/s. Probalby the coin is going to die after a week.
You have two main options in investing:
Invest into something what is already establised, but you will have no impact on your investment.
Invest in someting in early phase, but in this case you might have to work with the community.
THE MOST IMPORTANT THING:
BEFORE YOU INVEST MONEY INTO ANYTHING,
1.) READ COMMUNITY FORUMS/CHATS, BITCOINTALK.
If a coin community is toxic, than so is the coin. Forums will give you more info, than a roadmap or the official site.
2.) FIND RELIABLE SOURCES OF INFORMATION
One source is no source, alwasy compare to other sources. Be aware of FUD, many people try to get prices low to buy coins at a lower pirce.
And !newsagencies are not reilable!, this is important. Just try to compare the same news on different sites, it might be exact opposite of each other.
3.) IF A DEAL IS TO GOOD ITS MOST LIKELY SCAM
Dont be naive giving someone a dollar, beacues they promissed you thousand in exchange, you will never see your money.
4.) TRY MINING
Mining communtiy and mining itself helps you to understand things more about the coin, the algorithm and the exchanges.
5.) PREMINE & ICO
Theese are the most common way to scam. Look for the signs I mentioned up with Sigil. And the issues actually came up instantly on community chat.
Short time investments dont bring too much money, altough dont pump and dump, its illegal unethical and can ruin other people hard work.
Long time investments usually gets you futher, but dont expect to see money for years and they usually more safe.
Hope this will give the newbies a bit better understanding of how investing in cryptocurrencies works.