Today, we’re discussing How to Analyze a Crypto project Fundamentally
For each coin you will want to find out the following:
•Tokenomics
⁃ The tokenomics is a term used to describe how a particular project’s coins are distributed amongst different parties such as the Team, private sale investors, and marketing and mining rewards. An example of bad tokenomics would be if the team held more than 50% of the total coins which could lead you to believe the project is in for a quick buck.
•The team
⁃ Seeing who is working on the project can be a great indicator as to whether or not this project has potential or not. For example finding a project with ex founders of other successful coins *cough cough* Polkadot may be a reason to add another point to this coins score
•Inflationary or Deflationary
⁃ Does the amount of coins go up over time or down over time. Some coins have a feature called ‘Burning’ which essentially get rid of coins form the network over time, this would be an example of deflationary which is good for you as an investor as it’s means there will be less coins available to buy which usually makes the price go up. Fun fact: Bitcoin has deflationary mining, the amount of bitcoin that can be mined halves approximately every 4 years!
•Use Case
⁃ The use case of a project is what the project actually does in the real world or within the crypto world itself. An example of a good use case is a coin called Hathor (HTR), this project provides a Decentralised exchange called HathorSwap, with very little fees unlike competitors such as UniSwap which has large fees; this is a valuable use case. Projects usually have a main aim and this usually goes hand in hand with the use case.
•Product:
⁃ Some projects provide a product such as an app or a platform to preform actions on. An example of a good product would be ShareRing (SHR), which will help in COVID 19 tracking system with there ShareRing ID and they have a massive selection of travel essentials such as hotels and rentals which can be all controlled via their app which revolutionises travel.
•Partnerships
⁃ A Project with strong partnerships to already certified company’s or services are always a good sign that this project is legitimate and has a bright future. An example of a project with good partnerships is Shopping.IO (SPI), SPI is partnered with Amazon, and as we all know Amazon is one of the largest companies in existence so you can definitely believe in this project. So be in the lookout for these partnerships in the news and on there official website.
•News and Hype
⁃ Hype is a very important factor when in comes to investing in a coin, if you can identify this early before the majority of people do, you can get in early and make some money, this doesn’t mean that you should go and invest into DOGE coin though! Keeping Up to date with the news is a great way to know whether or not this coin has this magical buzz.
•Roadmap
⁃ A project Roadmap will tell you what the project has planned over the coming years. You can go over this roadmap and see if the project is sticking to it and meeting the times they promised, if they aren’t then look into why this is to determine whether or not you believe the team is being productive and making the moves needed for their success.
•Investors
⁃ Looking at who is backing the the project from infancy can tell you a lot about the projects future; projects with big venture capitalist backing are coins that have a big future especially one backed by top tier firms. The reason this is a good indicator on whether or not you have a good project is because the investment firm will hm have done lots of research and negotiation before putting their millions into it.
Resources:
•News Sites:
⁃ News sites:
⁃ Crypto chart makers Telegram
⁃ Coin Telegraph
•Research Sites
⁃ YouTube
⁃ Binance
•Telegram (gauge the atmosphere)
⁃ Official chats of respective Telegram group
⁃ Nonofficial trading chats in various groups
