Invest in Low or High Market Cap Cryptocurrencies? 🧐
Well, as I have previously mentioned, you should also take attention to the chosen crypto’s market cap.
Knowing about a crypto’s market cap and its ranking versus other coins is important because that info can quickly show you how popular the coin is and how much money you may be able to make from it. Of course, market capitalization alone can't tell you about the crypto's potential, it should always be used in conjunction with other factors.
So where should you invest, in a low market cap altcoin, with the potential of exponential growth and meteoric returns, yet a higher rate of uncertainty and possible failure ? or a large market cap altcoin at the top of their fields or industries who have achieved already a massive success and are approaching their limits of growth?
Here enters at some point the diversification. Why low and high market cap coins should fight each other in order to enter your portfolio? You can dedicate a portion of your capital to a few low-cap cryptos, in order to capture the potential exploding growth and manage your risk tolerance.
Last but not least, think about your crypto’s market cap potential in a healthy economy. How many people could benefit from using its technology?