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  • 13 Jan 25

Checklist: How to Analyze a Project Before Buying Cryptocurrency

Crypto analyst Miles Deutscher shared a checklist for analyzing cryptocurrencies before making a purchase.

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Crypto analyst Miles Deutscher shared a checklist for analyzing cryptocurrencies before making a purchase. According to him, answering the key questions in this list will help investors significantly improve their analytical skills and surpass 99% of other market participants. Here's what the checklist includes.

The Basics

The first stage of analysis involves studying the project itself. Miles suggests focusing on the following points:

  • What makes the project unique?
  • How well does the product fit the market?
  • Does it have a strong community and support from thought leaders?
  • Is the idea aligned with current market trends?
  • Does the project have a competitive advantage?
  • What are the project’s goals, and how achievable are they?

It’s also important to check whether the project’s smart contracts have been audited, whether it’s listed on centralized exchanges (CEXs), and whether there are any apparent risks, such as an inflated token supply or fraudulent schemes.

Tokenomics: What to Know

Tokenomics plays a key role in understanding the long-term potential of a cryptocurrency. Questions to consider:

  • What is the token’s primary function in the ecosystem?
  • Is the market cap to fully diluted valuation (FDV) ratio fair?
  • Does the project generate real revenue or fees?
  • Is the token inflationary or deflationary?
  • Is there a clear token unlock schedule, and are there plans to improve tokenomics?

Team and Partnerships

The professionalism of the team is another critical factor. According to Deutscher, investors should assess whether the team is doxxed and has a proven track record in the crypto industry. Equally important are the reputation of advisors, partnerships with established companies, and adherence to previously stated goals.

Technical and On-Chain Analysis

From a technical analysis perspective, it’s essential to understand how price behavior aligns with the market:

  • Is the price above key support levels?
  • Are there signs of an uptrend?
  • How liquid is the token?

On-chain data can provide insights into token ownership. For instance, check the number of whale investors, their behavior (buying or selling), and the growth in the number of unique wallets.

Why This Checklist Matters for Investors

Miles emphasizes that while this approach takes time, it allows for more informed decision-making. Most market participants do not conduct deep analysis, giving an advantage to those willing to put in the effort.

By using this checklist, investors can minimize risks and increase their chances of making successful investments. Good luck!

This post is for informational purposes only and is not an ad or investment advice. Please do your own research making any decisions.

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