The crypto market is as vibrant as ever right now. We are seeing increasing activity in the space, and more projects are raising funds as they hope to scale and deliver their services to people.
Crypto projects have also gained massive notoriety by launching cryptocurrencies. Many of them are looking to raise funds, while others use these coins as utility tokens that offer investors access to their services.
As such, there are ample opportunities for investors to get into the market. You could find interesting crypto projects that you’d like to back, and doing so means potentially getting on some massive gains.
However, before you take the plunge and invest in a crypto project, it’s also important for you to do your research. Critical research is one of the hallmarks of a suitable investment, and you need to be able to recognize the right projects to back.
To be fair, there is no one-size-fits-all when researching cryptocurrencies in a market like this.
A report on investment behavior from BDC Consulting revealed that investors consider several factors when choosing crypto projects – including the project’s transparency, understandable mechanics of functioning, and user generation.
Regardless, there are several important sources that should be studied when researching crypto projects. Below, we’ll examine some of the things you should consider when conducting cryptocurrency research:
Exploring social media platforms
It’s important to take social media very seriously when conducting cryptocurrency research. Each platform offers benefits that are unique – from the insights shared to the communication channels and even the types of investors who check out the platforms in the first place.
You can find several large crypto-focused groups on Facebook and Telegram. Twitter is primarily home to the quickest crypto bits, where many professionals and industry experts tend to share information directly to their fans. As for Reddit, it’s a bit of the Wild West. But, even Reddit has groups where significant crypto topics are being discussed.
When researching crypto projects, it is important for you to listen to both parts of the argument. There will be proponents, and there will be detractors. Understanding all the arguments will help you to know the project’s merits and demerits, and you can make decisions based on your inferences.
Check out upcoming events
Despite its importance, social media is still a small piece of it. Before investing, it’s critical to get a global perspective. To find this, you might need to check out upcoming events.
Sources like CoinMarketCap are great ways for you to get a glimpse of possible events coming in the future. They get information about possible events coming in the future, so you can prepare accordingly.
Try to understand some of the events that are coming, their possible impacts on the project, and what investors and insiders are saying about it. Google searches and the project’s website are other possible sources.
Know about the project’s fundamentals
If you’d like to be a long-term investor, it’s important to check a coin’s fundamentals. These days, there are a lot of new assets and projects trying to do what others have already done. Even if they’re trying to do these things better, it doesn’t necessarily mean that they will be able to stand out.
Discovering a coin’s fundamentals means looking at what it is trying to do and whether there’s a true market for it. This can be a time-consuming process, but it will save you a lot in the long run.
Do you think the project can deliver on its promise? Can its developers build a token economy that will lead to gains for investors? Or do you think the developers are just looking to make a quick buck?
Learn about trending topics
These days, there’s a lot about trends in the crypto space. Everyone’s talking about decentralized finance (DeFi), non-fungible tokens (NFTs), blockchain gaming, and much more.
A great way to analyze the market’s sentiment is to look into the space that a prospective project plays in. Know what the market is talking about in this space, and you can probably understand what people think about it. This is a great way to learn the early stages of what the market could be and the prospects.
Harness the strength of niche forums
Crypto-based forums on the internet offer another great way to gauge market sentiment when doing research. First, you get proper information regarding the project and the coin. Also, you can speak directly with individuals who understand the project more than you and who might even have gone deeper into the research project.
Are there any changes coming to the project? What do the developers have planned for it? Do you think they have a chance to actually pull things off? Questions like these are what you get to learn about during these forums.
Attend crypto meetups
It’s easy to think meetups don’t accomplish anything. Just people coming together and talking about stuff. Well, that belief isn’t necessarily correct.
Crypto meetups became especially popular in 2018 when coin prices took a dive following the market’s slump. Today, they’re pulling in thousands of enthusiastic crypto community members. If you’re looking for nuanced views about crypto projects, meetups are a great way to get started.
Meetups also allow you to get technical details about how to craft your research. Getting differing opinions is one of the most important parts of doing your own research, so meetups are your sure source for these.
Being able to spot a promising crypto project can be challenging. Many times, it looks like the investors who were able to get on the ground floor of several projects have simply struck gold.
But, it’s not always like that. Understanding how to conduct your research can help you to know which asset is more of a hit and which might not be. The full version of the study is available on the BDC Consulting website.