how to research a crypto dyor

5 factors to use to research a crypto (DYOR).

If you have been in the crypto space for a while now, you might have come across lingos like “DYOR-Do your own research” and “NFA-Not financial advice”. Making these statements do not help much as many crypto enthusiasts do not know how to do their own research.

In analyzing the financial markets to look for a probable market direction, there are technical, sentimental and fundamental analyses. Doing your own research on a crypto is solely based on the fundamentals of the coin or token; there are a lot of factors to consider and I will run you through them below.

Research a crypto tokenomics.

Tokenomics explains itself; the economics of a token or coin. It is the first factor to consider when contemplating on buying a certain cryptocurrency. This will show whether you are making a good investment or not.

It comprises of concepts like the crypto’s market capitalization, supply, liquidity and trading volume over the last 24 hours. Notable in tokenomics is whether a coin is inflationary or deflationary. This speaks volumes about the potential of the asset.

An inflationary crypto is somewhat like fiat currency; it is printed endlessly and loses value gradually as time goes on. A deflationary crypto is one that has a limited supply which creates a sense of scarcity thereby gaining value gradually.

The idea behind the inflationary and deflationary concepts is that; a crypto can experience inflation when there is no limit to the amount that can be mined and it can experience deflation if it has a fixed supply. These are long term predictions.

Bitcoin is a perfect example of both an inflationary and deflationary crypto. For the time being, it is inflationary since there are many more bitcoin blocks to be mined. Eventually though, it will become deflationary when the last block is mined to reach its maximum supply around 2100. The bitcoin blockchain has been programmed to be valuable in the long term.

Teams behind project the crypto project.

Integrity is a good trait and any sane individual looks forward to dealing with people who have a good reputation. It is the same idea when doing your own research on a specific cryoptocurrency. The people behind the projects matter very much.

Just like jobs look at CV’s and will seldom hire ex-convicts or people with a bad history, crypto researchers like their potential investments free from questionable characters. With the amount of scams in the crypto industry right now, the integrity of a team is very important.

For instance, SOL is a budding cryptocurrency and it is the 7th largest coin by market cap at the time of this writing. It was created and co-founded by Anatoly Yakovenko; one who has worked as a software engineer at dropbox, Mesosphere and Qualcomm.

His team comprises of Greg Fitzgerald, Raj Gokal, Eric Williams and a whole lot of other people who have made a name for themselves in the tech and crypto industry. With such a good track record, you can be rest assured that you are buying into a legitimate and long term project.

Strong and reputable teams behind a crypto project matter very much in an industry where big investors want to scam, pump and dump and go their way. Always make sure to do your research on the teams.

Whitepaper of the crypto.

Every serious crypto project has a whitepaper. They can be found with just a simple google search. Whitepapers outline the problems that a cryptocurrency is meant to solve and the processes through which it will be solved.

They may be difficult to read as they come with a few technicalities. However, with just a little bit of focus anyone with good language skills can grasp them. Also, people break them down and simplify them all the time so you can always find what works for you.

Crypto focused sites like coinmarketcap and coingecko also go the extra mile to break down and summarize the purpose of the coins or tokens. Their summaries could be used as mini whitepapers though they can not substitute the full versions.

You might have heard the term “use case” being thrown around recently; for instance shiba inu or dogecoin has no use case and it will not be long before they die out of the crypto space. Use case is basically the problem a coin solves and it is well detailed in whitepapers.

Ethereum, the second largest crypto by market cap’s major use case is in the creation of smart contracts. Solana can also be used to create NFTs as well as smart contracts. Coins with good use cases have the potential to shoot up in value gradually.

Sector of the crypto.

Sector is also an important aspect when doing your own research in crypto. It plays a role in highlighting the use case and growth potential of a coin. A lot of sectors popping up in the crypto space Decentralized Finance (DeFi), Decentralized Exchanges (Dex’s), Smart contracts, Non-Fungible Tokens (NFTs), Stablecoins, Metaverse and a whole lot.

Knowing the sector of a crypto allows you to know what it can do. For instance, if you are looking for a coin where you can buy and hold and make some crazy gains over the years it will be disastrous to buy a stablecoin like USDT or BUSD.

Presently, the coins making waves are the ones in the Metaverse sector due to the potential the masses see in a digital future.

Research a crypto ‘s social media.

When it comes to cryptos, social media is a powerful tool when researching the potential of a coin. The idea is that the larger the amount of following, the better. Higher numbers speaks well for any coin since it could mean that there are many people who buy into a particular project.

However, not all social media apps are created equally with respect to cryptos. The most valuable apps to look at when doing your research on a coin are Reddit, Twitter, Discord and Youtube. These ones are the standout apps.

Fantom’s FTM is one of the cryptos with a good potential. A simple research on the crypto on twitter reveals a combined following of over 400,000 accounts on two well known FTM  accounts; Fantom Community Alerts and Fantom Foundation. They also have massive engagements on their tweets as well as a lot of mentions from individual accounts.

Huge number of following is important but it doesn’t end there. Engagement is also an important factor, thus, users who believe in the potential of a coin must be vocal about it on social media platforms. Frequent postings, comments and likes also speaks volumes.

This must be taken with a grain of salt though; since cryptos referred to as “shitcoins” may be popular on social media; because users would want many others to buy into their hype with the “get rich quick” mentality. It may work in the short while but it doesn’t always have a good ending.



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