Okay 👍
I will give you a structured and step-by-step guide to fundamental analysis for cryptocurrencies, so you know how to evaluate any project before investing in it and avoid most of the 'traps' in the market.
---#Bitlayer
1. What is Fundamental Analysis in Cryptocurrencies?
Fundamental Analysis (FA) means evaluating the value of the currency or project by studying:
The Idea Behind the Project
The Team and Investors
Financial or Economic Data
Usage Volume and Partnerships
Goal: To know if the currency is undervalued or overvalued.
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2. Steps for Fundamental Analysis of Cryptocurrencies
First: Study of the Project (Whitepaper)
Read the official document (Whitepaper) to understand:
The problem the project solves
Mechanism of Action (Blockchain, Layer 2, DeFi…)
Distribution Plan (Tokenomics)
Roadmap
> Note: If the white paper is vague or full of promises without a clear plan → Warning Sign 🚩
---#Xrp🔥🔥
Second: Team and Founders Analysis
Is the team known and have a track record of successes in previous projects?
Are there major investors (VCs) supporting the project?
Transparency of their accounts on LinkedIn and Twitter
Third: Analysis of the Internal Economy of the Currency (Tokenomics)
Total Supply and Circulating Supply
Inflation or Deflation Rate
Token Distribution: How much for the team? How much for investors? How much for the community?
Burn or Buyback Mechanism (if any)
---#Bitlayer
Fourth: Study of Activity and Partnerships
The existence of real partnerships with other companies or protocols
Number of Active Users
Projects built on the platform
Fifth: Study of On-chain Data
Daily Transaction Volume
Number of Active Wallets
Liquidity Volume in Decentralized Exchanges (DEX Liquidity)
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Sixth: Study of Competitors and Target Market
Is the project entering a new market or competing with strong existing projects?
Competitive Advantage
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Seventh: News and Updates
Follow the project's official channels (Twitter, Telegram, Discord)
Follow General Market News (Regulations, Government Decisions…)
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3. Useful Indicators and Sites for Analysis
CoinMarketCap or CoinGecko → Price and Supply Data
Messari.io → Project Analysis and Reports
TokenUnlocks.app → Token Unlock Dates
DefiLlama → Follow Liquidity in DeFi Projects
Glassnode or Santiment → On-chain Data
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4. Warning Signs (Avoid These)
Promises of Guaranteed or Unrealistic Profits
Completely Anonymous Team
Unfair Token Distribution (Most in the hands of the team or major investors)
