Investor Guide to Evaluating Cryptocurrencies

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The cryptocurrency market continues to be dynamic and often volatile. However, with growing institutional adoption and regulatory support, investors around the world are once again expressing interest in cryptocurrencies.

Methods to Evaluating Cryptocurrencies

The first cryptocurrency, Bitcoin is the most preferred cryptocurrency amongst Institutions due to its unique position as a store of value due to its limited supply and also its utility as a payment method. Bitcoin with its large market cap is likely to grow at a healthy pace this year as per the known forecasters in the market. But investors would like to diversify their portfolio, so which cryptocurrencies to include in their portfolio?

Self Assessment: Before identifying the best cryptocurrencies to invest in for 2025, investors must begin with a clear self-assessment. Understanding one’s risk appetite, investment horizon, and capital allocation is crucial in making informed decisions. Clarifying individual financial goals, whether aiming for short-term gains or building a long-term portfolio, helps align investment choices with personal strategy and reduces the likelihood of emotional or impulsive decisions during market volatility.

There are several approaches investors use to determine which crypto assets to invest in. But the dominant methods are to either DYOR which is Do Your Own Research or to depend on Trusted Sources. Most investors will probably do a mix of both. 

DYOR: DYOR remains the most comprehensive route. It involves in-depth analysis using various tools and signals. These includes:

1.On-chain analysis:

On-chain data provides raw, verifiable information straight from the blockchain, making it one of the most transparent ways to assess a crypto project’s actual usage and health. The Top on-chain statistics that matter include

• Token Supply and Inflation: Limited or reducing [Via Burn] supply is good while increasing supply of tokens is not good for price
• Active Addresses on Chain – More the Better
• Exchange Inflows/Outflows – Exchange outflows is good for price
• Whale Activity – Tokens with high Whale presence tend to go up or down depending on Whale Buying or Selling.
• Transactions – An increasing rise in Transactions is Good. 
• Network activity provides insight into long-term utility. Metrics such as smart contract usage, dApp activity, and total transactions on the network help investors evaluate whether the blockchain is gaining traction among developers and users
• TVL – Total Value Locked in DeFi Protocols, higher and rising is good
• Revenue – Revenue earned by the Blockchain. NFT Sales statistics.

Most blockchains provide explorers to be able to do this analysis. Alternatively numerous platforms like DefiLlama and Dappradar provide these statistics in a more organized manner on their platform. 

While On-Chain activity is a good indicator of price, it is not enough to predict future performance. It ignores macro-economic influences, news flow, community engagement and current relative valuation. That aside, reading on-chain activity is also quite onerous work and many investors restrict it to their shortlisted tokens only.

2. Technical Analysis: 

Many investors prefer technical analysis which involves regularly analysing the technical indicators. Technical indicators are really good for short term and even medium term price action

• Trend Indicators like Moving averages, MACD and Ichimoku Cloud
• Momentum Indicators like RSI, Momentum, CCI, Williams etc
• Volume based indicators like OBV and Chaikin Money Flow
• Volatility indicators like Bollinger bands and ATR
• Pattern Indicators like H&S, Fibonacci Retracement, Triangles

This form of data is available either via platforms that provide crypto screeners like Bitscreener or popular platforms like Tradingview.

While Technical analysis is quite reliable, it needs a high level of skills. Secondly, technical analysis output gets distorted by factors like Whale control, Market Maker engagement, Exchange listing, Other news flow and even Macroeconomic news. 

Reliance on Trusted Sources: Apart from DYOR, investors likely depend on the recommendations from trusted friends and family, social media influencers, analysts or other established institutions. 

These sources carry out detailed research as detailed in DYOR but may also include macroeconomics, community engagement, product innovations etc to come out with a detailed note, analysis or report on the likely price implications for a cryptocurrency. Most Investors prefer this method as it requires lesser effort and skill in comparison with DYOR. 

The downside of this method is that given that cryptocurrency is an emerging sector, reliable and trustworthy sources are not common place and even trustworthy sources may not have done beyond one cryptocurrency cycle. That said, just like the manner in which TipRanks tracks analysts on their forecasting accuracy, Crowdwisdom360 does the same for Cryptocurrency experts. 

Now that we have understood how to go about identifying best cryptocurrencies, let us get into the list.

Cryptocurrencies Delivering Higher Return

To help investors find the cryptocurrencies likely to deliver higher return return in 2025, we followed a smart and practical approach. We looked for coins that are already established but still undervalued, showing early signs of growth, and backed by steady buying interest. We also avoided tokens dominated by a few large holders, as these can be more risky. The result is a list of tokens that are deliver better ROI than most tokens this year, based on both data and investor behavior. This is a combination of Technical analysis and On-chain analysis. 

1. Ethereum ($ETH)

The second largest cryptocurrency by market cap, Ethereum has numerous use cases and has spawned numerous layer-2 blockchains. Many entrepreneurs/communities used Ethereum’s smart contracts to launch their own cryptocurrencies. ETH

2. Chainlink ($LINK)

Chainlink has established itself as the dominant oracle network, connecting smart contracts to real-world data. Chainlink continues to be made available across numerous applications. 

3. Eigenlayer ($EIGEN)

EigenLayer introduces restaking to Ethereum, allowing users to re-use their staked ETH to secure additional services. It has attracted significant attention from the DeFi community. 

4. DOG ($DOG)

DOG is a community-driven memecoin that has gained traction through viral marketing and strong retail support. It has risen around 150% in the last 30 days.

5. BRETT ($BRETT)

BRETT is a memecoin with growing community backing and improving technical strength. It has maintained a bullish trend above key moving averages. BRETT was recently listed on LCX. 

6. Bittensor ($TAO)

Bittensor powers a decentralized machine learning network where users contribute and train AI models. It is one of the few tokens bridging blockchain and AI meaningfully. TAO has surged from $320 to nearly $450 and continues to gain investor interest. 

7. Litecoin ($LTC)

Litecoin is a fast, low-cost cryptocurrency often used for peer-to-peer payments. It is widely accepted and has a strong historical track record. LTC has been often referred to as the “silver to Bitcoin’s gold.” 

This is only an indicative list and avoids cryptocurrencies that have a huge concentration of whales. Tokens with high concentration of whales can be traded for very short periods. This list can be much larger and varies over time. Placing proper stop losses for every investment is always a wise decision. This list will be updated regularly as market conditions evolve.”

*This article was paid for. Cryptonomist did not write the article or test the platform.