How To Research and Invest (One Investor’s Method)

We chose to excerpt the post below because it is a reasonably descriptive approach to crypto investing that some members of the UVA Cryptocurrency Club also use. While it is certainly not all-inclusive, it serves as a great introduction to get started.


“Alright, so here’s my research process.

First, it’s always important to look at the market cap and supply of coins, and whether or not there will be a burn-off or something similar. Also, look at what exchanges the coin is trading on. These are huge in relation to price, and should be thought about it in terms of your investing goals, and especially look at the supply existing.

Then comes the actual research. I always read the white paper. The first thing I want to know is: what does the coin do and why is it a novel adaption to the crypto space? Usually, if the white paper lacks technical information, this is a red flag. Also, a lot of coins create coins just for the sake of getting funds from an ICO, without really having a strong use-case. So I always ask myself: what is the point of this coin? Could this project be a thing without the coin implemented? Once you read enough white papers, you begin to be able to naturally identify good projects, but what you’re looking for is innovation.

Then I look at the team. Who are they and what are their credentials? If you can’t find the founders on LinkedIn, that is usually, although not always, a red flag. You want them to have a good mix of coders, but also a strong marketing and business development team. Marketing is huge in this space. Then I look at their sponsors or partnerships, which is a huge factor for adoption. After looking at the white paper, hopefully I have confidence that the coin can perform what it says it can, and carry out its roadmap.

I then go onto the coin’s website and look all over the site, especially at the roadmap or upcoming features that might cause some price action. Then I look at the social channels, specifically Reddit. It can be full of trolls, but it also has some good information here and there, and I read the FAQs, and assess the community. Also, I like reading peoples’ shills now and again, just to make sure a good opportunity doesn’t pass me by. When I research a coin on Reddit, a lot of times I want to read what people say is bad about the coin, because the white paper doesn’t always mention the coin’s obstacles or weaknesses. If the coin has a lot of hype, that is a big factor, because crypto trades almost exclusively on fundamentals, and the investors in this space are all trying to make money quickly.

So to make it simplified, here are the things I look at:
1. Novelty/Innovation
2. Team/Credentials
3. Use Case/Potential for Adoption
4. Marketing Ability
5. Strengths/Weaknesses/Obstacles
6. Sponsorships/Partnerships
7. Supply
8. Hype”


This article is an excerpt from a post by user SmartThinker on wallstreetoasis.com. You can access the full post and more at: https://www.wallstreetoasis.com/forums/im-in-college-and-a-millionaire-because-of-crypto-ama