In this thread, you’ll learn a very simple process you can use to analyze any cryptocurrency
When influencers drop a new play and end it with “DYOR” well here’s how to do your research and avoid rugs
Most crypto enthusiasts don’t even know how to do proper research before investing their funds into a particular token
The steps below is how i personally analyze any token or coin and know if it’s worth a long term hold or just a short term pump and dump shit coin.
First step is to look at the MARKET STATS AND OVERVIEW of the token.
I personally recommend @coingecko for this because it’s more user friendly and easy to understand, another option is @CoinMarketCap
Now on @coingecko you can see informations like ;
1 - The Top Exchanges Supporting the token
2 - The trading statistics (Volume and Market Cap)
3 - The Market Sector ( The Project’s Document, Website, Twitter, Discord and their communities)
4- The Tokenomics ( Economics of the Token )
1 - You have to ensure it is supported by top exchanges such as Binance, Coinbase, OKX and the likes
Most top exchanges ensure they don’t list shitcoins on their platform
2 - You can also ensure that the Total Supply and Circulating supply are nearly almost the same, which means that no new set of tokens will created that can affect the value
Also check if it also has a decent 24hrs trading volume and a good market cap
NB - The worth of a standard token should always be the Market Cap divided by the Circulating Supply.
3 - Take a look at the project’s document such as the whitepaper, which can most times be found on the project’s website
How organic is the Project’s Twitter, Discord and community generally ?
Ensure that everything ticks the box before investing your money.
4- The Tokenomics : This can be said to be the economical side of a particular token
You can also check tokenomics on @coingecko as well
Now let’s use Cardano’s $ADA as an example ??
The above photo describes the Token distribution of $ADA
57% to ICO
11.50% to the team
30.90% for staking rewards
This is a very healthy distribution imo.
The Below Photo also describes the supply schedule of $ADA, this pretty much explains itself ??
Everything above has the basic information you need to DO YOUR OWN RESEARCH before investing your money into any cryptocurrency
Know what to hold long term, know what to hold for a short time but always take profit aggressively
Because even the best tokens can still go to zero.
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