What Makes a Cryptocurrency Likely to Survive Long-Term

Each and every day, there are cryptocurrency projects that crash forever or are delisted due to going defunct. But how can you tell which cryptocurrencies are likely to survive long-term?

Robust whitepapers, usability, and uniqueness are all good qualities to look for when trying to predict the sustainability of a cryptocurrency. Read on to learn more about what makes a cryptocurrency survive long-term.

1. A Robust Whitepaper

You should never invest in a cryptocurrency without a whitepaper. A whitepaper will give you a good idea of how much planning and research has gone into a particular project. Not just that, but the more informative and robust a whitepaper is, the more likely it is that it will survive long-term.

Of course, just having a whitepaper is not enough to guarantee a project will survive, but it is a good place to start your evaluation into a cryptocurrency’s longevity.

2. Usability/Utility

One thing we like to look for when evaluating projects is how usable they are. Ask yourself, does this cryptocurrency serve a purpose? If so, is it one that is applicable to everyday life? For example, Bitcoin offers a store of value and a way to send money abroad without using a bank, but the same can’t be said for other projects.

Again, this alone is not an indication, but if you look at cryptocurrency projects which have already failed, you’ll notice they have one thing in common—many were trying to make it without a clear application of the cryptocurrency. Still confused? Just look at what happened with NFTs.

3. Uniqueness

Another aspect to consider is the uniqueness of a project. For example, while a project may have a great whitepaper and utility, if there are twenty other projects just like the one you are considering, that project will likely always struggle for success. This is because not only does it have to be well-made and usable, but it also has to be better than the 20 other alternatives. This alone led to the death of many tokens in recent years.

That being said, if a project has 2 or 3 competitors, it may still be worth an investment. In our opinion, the number of competitors is also important. But generally, if you see more than three, you can assume the competition is too steep for the cryptocurrency to survive (i.e., memecoins).

4. Who Is Behind the Cryptocurrency?

You’ll also want to consider the creator when evaluating a project's potential longevity. Humans have a tendency to grow bored, run out of funds, and run out of ideas, so when you invest in a new project, it’s important to note whether or not you would invest in the creator themselves. If the answer is no, then it’s likely the project won’t last.

Ask yourself, does the person behind the project have the knowledge to continue the project long term? Do they have the funds to continue? And do you trust the person to be successful? If you answer no to any of these, don’t invest.

A good example of this is Ethereum. While Ethereum has gone through some rough patches, Vitalik Buterin has the know-how and the investor backing to continue the project for a long time. He is also knowledgeable and knows his industry—something which the long-term status of Ethereum displays.

If you compare it to World Liberty Financial (Trump’s official token), for example, the same can’t be said. Trump does not have the know-how to work on his own cryptocurrency, and while he may have the money now, he’s bankrupted enough companies that investors tend not to trust him. Pair this with the fact that he is old and often speaks unintelligibly, and it’s easy to see why his token has not experienced widespread success.

**It is important to note that you can also consider institutional backers in this step. If a project’s creator doesn’t have funds but is great at gathering venture capital funds, then they have a higher chance of success than if they are striking out on their own.

5. Where is the Cryptocurrency Based?

If you believe in the person behind the cryptocurrency, the next step is to consider where they are based. While this may seem trivial compared to everything we mentioned above, local regulations are always changing, and this can have an effect on a cryptocurrency.

A prime example is pre-2019, when many cryptocurrencies were based in China, only for the government to implement a full ban on crypto. When this happened, companies either had to rush to relocate or shutter entirely, and as such, many cryptocurrencies that may have survived long-term were snuffed out overnight.

Obviously, you can’t have a crystal ball (and we don’t have one either), but we urge you to be more critical of cryptocurrencies based in countries with harsh laws like China, Russia, and North Korea. Then take into account countries with changing politics like the US. Definitely take a look at current and pending regulations before making your final decision.

6. It Prioritizes Security

Unfortunately, there have been cryptocurrencies that have met every requirement on this list so far only to skimp on security and fall victim to a hack or other code-related weakness. Cryptocurrencies not only have to talk the talk, but they also have to walk the walk. This means you should only invest in projects which also invest in themselves via audits, checks, and continuing development.

If a project has everything on this list, but doesn’t take the time to invest in security, then it is just as dangerous as investing in a product which has none of these things. So, before you buy, ensure you check for a whitepaper, utility, who is behind the project, where they are based, and whether or not they prioritize security. If they do, then you may have found a cryptocurrency which will weather the crypto winter and survive long term.