The crypto space is full of risks and opportunities. There are so many coins and tokens to choose from, making it hard to know which ones are worth investing in. Doing your own research (DYOR) ensures that you will not lose your money.
Let us take, for instance, when venturing into a decision to buy a new car or house, or even any long-term investment, do you do your research? Without a doubt, the answer is likely a big yes.
When deciding to put your money into something, it is always a step to get an idea of its viability and see if it’s the right choice.
To do so, take your time to research.
What is DYOR in Crypto?
It is a familiar notion that cryptocurrency is a very volatile market. As such, you might be lost if you lack a strong base of knowledge and understanding.
As a way of gaining the requisite knowledge, educating oneself is the only key.
The info on crypto one gets from research is known as DYOR in crypto.
How to Do Your Research
Before picking a cryptocurrency, you should research it thoroughly and analyze it. Some methods help in such a task.
1. Fundamental Analysis
The central concept behind fundamental analysis is analyzing a company carrying out the project, the founding team, whitepapers, tokenomics, future roadmap, and more. In simpler words, fundamental analysis assists you in finding a fair value of a cryptocurrency.
Additionally, it shows how much crypto is worth and if it can survive in the crypto market.
In addition, it takes on the part of research to evaluate the crypto industry and competitors to show if it is the right time to invest.
2. Technical Analysis
As seen, fundamental analysis tells you the worth of cryptos. On the other hand, technical analysis provides you with the strategy you need to dive into the market.
Technical analysis involves analyzing the price movement of the crypto you want to invest in, comparing it, and finding the trends.
There are several ways in which you can conduct technical analysis. It may include price charts, reading trends, indicators, candlestick patterns, and more.
3. Sentimental Analysis
The sentimental analysis involves looking for different sentiments traders record concerning the overall market condition or a specific crypto asset.
Investors often drive market conditions in the direction they feel it can take. As a result, there may be overselling or overbuying of an asset.
Consequently, the result may be increased volatility and a high probability of entering the market at the wrong time.
This does not affect the worth of crypto. However, it has the ability to affect the prices and, in turn, your investments.
4. On-Chain Analysis
This technique is quite an advanced one as it uses blockchain data and takes into consideration different metrics.
Such include a crypto’s transaction value and count, transaction fees, hash rate, and staked tokens.
The main reason for an on-chain analysis is to know how stable the blockchain network of the crypto is.
5. Social Media Analysis
The foundation of this analysis is evaluating the project’s website. The website gives a prospect of the future of that project.
The next step involves checking the social media platforms and seeing what experts and influencers say about the preferred cryptos.
6. Read Whitepapers
From beginning to end, the prospects of a cryptocurrency are in a whitepaper. The document tells you the start of the crypto project, its reason for issuing, the roadmap ahead, and the growth prospects.
Investing in Crypto
The most basic but important factor to consider when investing in crypto is understanding the space. As crypto markets are highly volatile, it becomes crucial to research before venturing in.
Knowledge mitigates the risks investors can face in the markets. DYOR helps you see crypto assets differently and make financially sound decisions.
Comments