How To Research Cryptocurrencies
In this video I show you how I research cryptocurrencies, including my favorite sources for news and keeping up to date, as well as the important pieces of information I analyze the determine the underlying value of the cryptocurrency or crypto-asset.
-The asset name, ticker symbol, and current market cap (i.e.: Ethereum/ETH/$34.7 Billion)-
-Also is it stable or has it been very volatile in past months? Any major activity in recent days/weeks?
-Looking at market price and volume. How has volume been? Esp compared to market cap?
-Current coin supply, max coin supply.
-Inflation rate: 1-year inflation rate (take supply 1 year out by determining block reward and issuance frequency, divide by current supply). This is a big one.
-The value proposition (and target market), and potential size of the market, (un-exaggerated) (i.e: platforms vs (relative) smaller use cases. How has this market growth been so far?
-What is it doing unique (if it is). Is it another copy-cat or clone? (Bitcoin has thousands of clones). Are there a lot of copy-cats already for it? What does it really have going for it?
-How would it monetize? (if it is monetizable) (this is important for many ICO's or smaller-use case cryptos).
-How would it grow? (And on that note, is it currently growing? And how fast?)
Size of the community/Public interest-
-Reddit size and growth- a screenshot of redditmetrics total community size within a report is good - be sure to do total community size here
-Slack channel size and growth
-Telegram channel size and growth
-# of Twitter followers
-Transactions per day, amount sent per day(in USD)
-Active nodes/active addresses- observing growth of this (is it going up, down or stagnant?)
-Forum statistics. Including # of members, most # of members active in history, # of users currently online. And growth stats if you can determine that (by checking the forum, seeing how many new users being added per day-- I do this often manually taking screenshots of it and checking the growth over time).
-Alexa ranking-- this is important for seeing website traffic
-Also see if it has a noticeable presence anywhere -Alexa shows this data on their site. (ie: Antshares obviously gets a lot more traffic in China)
-Google search traffic (via Google trends)
*note on community size* it's important but not everything, as seen by Dogecoin, the direction and tech behind it is important too. (See bitinfocharts)
-How many team members?
-Who are the main developers/leaders?
How big of following do they have on social media- esp twitter.
-What is their history?
-Their history in cryptocurrency, what past work have they done?
-Any shady background on them?
-How well do they interact with the public? Are they likable? What is their reputation? (These
are the leaders after all. People often buy the leaders, not what is currently available, it's like
buying the brand, the reputation, without knowing all the details. Same for cars, clothes- and
-How adaptable and sharp are they?
-Checking GitHub activity
-How fast are they progressing the project? Consider that all cryptos develop at a different pace.
Some very fast some very slow, some in the middle.
-This is relevant as some cryptos esp with icos are certainly cash grabs, if the devs don't move
fast, they get swallowed up by competition- example of Vine vs Instagram I saw the end of vine
coming once Instagram added 15s video capability - and now they added Snapchat capability.
Instagram team is sharp.
History of the Asset-
-How long it has been around. (3 years or 3 months?) - gives more insight into checking various
things, if been around longer, should see good progress in it, if not red flag. Competence of
developers know they need to bring to market (with consideration to quality), you don't want to
rush them but that’s the name of the game. If it's new, needs a lot of scrutiny to make sure it's
going to stick around.
-How it has performed in the market in that time. Hints market interest, etc
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