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Coach D – Cryptocurrency & Tokens – Do Your Own Research (DYOR) Part 1
1) Initial information gathering and filtering
Once I identify something that looks like a good potential investment, I first go to the CoinMarketCap page for that symbol and look at the website and blockchain explorer.
* Critically evaluate the website. This is the first pass of the bullshit detector and you can tell from a lot from just the website whether its a scam. If it uses terms like “Web 4.0” or other nonsensical buzzwords, if it’s unprofessional and has anonymous teams, stay away. Always look for a roadmap, compare to what was actually delivered so far. Always check the team, try to find them on LinkedIn and what they did in the past.
* Read the white-paper or business development plan. You should fully understand how this crypto functions and how its trying to create value. If there is no use case or if the use case does not require or benefit from a blockchain, move on. Look for red flags like massive portions of the float being assigned to the founders of the coin, vague definition of who would use the coin, anonymous teams, promises of large payouts…etc
* Check the blockchain explorer. How is the token distribution across accounts? Are the big accounts holding or selling? Which account is likely the foundation account, which is the founders account?
* Read the subreddit and blogs for the cryptocurrency and also evaluate the community. Try to figure out exactly what the potential use cases are and look for skeptical takes. Look at the Github repos, does it look empty or is there plenty of activity?
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