Your 7-Point Checklist to Crypto Research

First and foremost, create a short list of projects that you are interested in. Then, review each project by reviewing their website, team, smart contracts, marketing style, and so on. Practically, do everything that one does when conducting fundamental analysis. https://xcritical.com/ It’s important to check the social media accounts of a project before you invest. This is where you’ll find most of the information about the team and their plans for the future. Details on what ownership, voting, and yield-earning rights token holders get.

This is your chance to understand their intentions and decide whether you think the plan is realistic before jumping in. From here you get a good view of what the sentiment around a crypto is. Another thing here is that you can adjust the time frame to as narrow as 5 minutes and this might help you spot the local top.

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Investors could dollar-cost average into a position expecting to ride out the waves, make an initial investment only, or trade daily. The important thing is to take action and follow the investment strategy that is right for you and your investment goals. Network effects – The Terra protocol has a number of network effects to support its growth. Firstly, it’s integrated with the Cosmos ecosystem so is incredibly easy to use by dApps there. Furthermore, it’s building bridges to all the popular layer 1 protocols.

The tokenomics include details of how the token will be distributed among the investors as well as its supply limits. It also includes information regarding minting new tokens as well as token burning, if that is part of the ecosystem. Today, 19,000 cryptocurrencies exist, and many of these altcoins frankly don’t have a promising future. So it’s important to learn how to tell which coin is worth your time and money.

How to Use Etherscan: Analyse Smart Contracts

Competitor analysis allows you to discover the strengths and weaknesses of various projects. For example, a project might have robust technology but poor implementation, while another project might have the opposite. By understanding the competitive environment, you can weigh the pros and cons and make investment decisions that align with their goals and risk https://xcritical.com/blog/how-to-do-your-own-research-dyor-before-investing-in-crypto/ tolerance. Bitconnect is one of the most famous high-yield Ponzi schemes in crypto history, causing losses of up to $3.45 billion in total. In November 2017, Vitalik, the founder of Ethereum, had already accused Bitconnect of being a scam. However, as investors were so overwhelmed by the high returns, they didn’t realize the huge risks behind the yield.

The term meant that it was necessary to make investment decisions based only on their conclusions and not other people’s opinions and advice. Hence, there are on-chain data analysis platforms that provide statistics on the network’s health in real-time. Speculating on-chain metrics help you analyze market and investor behavior. For example, think of market capitalization as the participation of all traders and this could encourage the participation of long-term investors. CoinGecko makes it easy for investors to access projects’ white papers through the Whitepaper feature on the platform.

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While a project doesn’t need to be perfect in every respect, the stronger it is overall, then the higher the chances it will prove a lucrative long-term investment. Please note that none of the information in here is any kind of financial advice but only sharing of an opinion. Understand the target market, is the message easy to understand etc.

Not surprisingly, now there are 100s, if not 1000s, of NFT projects that have flooded the market. Despite these last few months of a downturn in crypto markets, the NFT market has never been hotter, especially on the Solana blockchain. NFT markets primarily are driven by hype, with utility as a second.

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The term first became popular during a wave ofICO projects that flooded into the cryptocurrency space between 2016 and 2018. Many investors were left duped or out of pocket by a host of scams entering the market as potential get-rich-quick crowdfunding schemes. In addition to understanding the market metrics, you should always take note of the price history of a cryptocurrency. The crypto market is volatile, so it’s normal to see fluctuations in price, but look for a gradual increase in price over time. It’s wise to observe the price over different time spans, including the “all time” history view to get as broad an understanding as possible of the long-term and shorter-term price trends.

Ideally projects with hype what you have to be looking for. Fear and Greed Index The crypto market is greatly affected by the sentiment of traders. In other words, DYOR is needed to reduce the number of uninformed investors and encourage them to understand the product before investing money.

How to do your own research in cryptocurrency

You don’t want to miss out on an airdrop just because you didn’t have a clue that there even was something to miss. Glassnode is an on-chain analytics tool and it’s one of my favorite places to visit when the markets turn red and I need to see the bigger picture to regain my confidence. Looking at active wallet addresses rising always helps me sleep at night.

• Coin Bureau – Extremely high quality and very researched content.
• The term DYOR is used in many fields, but it can be even more important in crypto investing than in the traditional financial market.
• To my surprise, people were extremely enthusiastic and saw the eventual recovery as something given.
• A bunch of people coming together, just to ensure that everyone believes the same thing.
• Look for people who are very much invested in a certain altcoin.
• Cryptocurrencies are bought or traded by investors and speculators, and everything needs to be put in the correct perspective.
• For smart contract tokens, the tokenomics data shows the number of tokens released at launch, whom they were allocated to , and information about vested tokens.

It has a vast amount of market information on nearly all the coins and tokens in existence. The amount of information is so diverse and large that many new aspiring investors may feel lost figuring out what to pay attention to. The acronym DYOR is well-known in crypto and blockchain circles. It refers to carrying out your due diligence and gathering the right kind of market intelligence to make successful investment decisions. In this article, we will cover some key DYOR tools and how you can use each of these tools for effective crypto research.