Do Your Own Research (DYOR) is a phrase that accompanies every investment advice in crypto and otherwise. Most of us have relied on trading signals or token suggestions from influencers and seasoned investors at some point in our investment journey. But it is nearly impossible to make it big in crypto without having a proper understanding of the industry and sound research skills. With over 21,000 cryptocurrencies on listed on CoinMarketCap, how do you identify solid projects? In this blog, you will learn about some of the best crypto research tools to up your investment game.
How Do You Research A Crypto Project?
Crypto research tools do simplify the process of identifying solid projects, but what is the process you need to follow for researching a new project? Here’s a step-by-step guide to researching a crypto project:
- Understanding The Use Case: Use case refers to the problems that the project solves. Recall the term memecoin? Memecoins are called so because they are tokens without any real-world use case. This puts a huge question mark on their future. If you are in crypto to make a fortune, you must look for cryptocurrencies with strong fundamentals. A solid use case is critical to strong fundamentals, and it is bound to have a market impact in the long run.
- Scan Social Media: Social media is one of the most effective tools to check if a crypto project is active. It helps you differentiate between genuine projects and Ponzi schemes designed to loot investors. Search the project’s token symbol on Reddit, scan informative Twitter accounts that share useful insights, follow trusted influencers, and assess the online community strength of the project.
- Check The Team: The success of a project depends on the people building it. You can assess how serious the project is by looking at the qualifications, experience, and previous work of the team behind it. Therefore, you must go through the information about the team members of the project you are researching.
- Competitor Check: New trends continue to emerge in the crypto space. So how do you assess if the trend will last beyond the hype phase? An effective strategy is to measure the performance of competitors to the crypto project you are researching. This will help you get a rough idea of how well the project you are investing in can perform.
- Market Cap and Tokenomics: In the highly volatile market the crypto is, the market cap is a better indicator to assess the performance of a cryptocurrency than its market price. The higher the market cap, the stronger the project. Another vital metric for researching a crypto project is its tokenomics. Tokenomics means how the project issues tokens, what portion of the tokens is held by the owner, burn mechanism, total supply, distribution mechanism, and other critical developments that affect the token’s price. Studying tokenomics is particularly important for the technical analysis (TA) of a project.
- What Exchanges Is It Listed On: Cryptocurrencies listed on top exchanges like Binance, FTX, Kucoin, and Huobi are bound to have more trust than those on exchanges with comparatively less volume. If you are looking for a safe investment with higher growth potential, sticking to these exchanges will certainly help.
Now, while these steps are extremely helpful, doing all this manually is a daunting task. This is why you need some top crypto research tools. Continue reading if you want to learn about these tools.
Best Crypto Research Tools In 2022
- Glassnode: One of the best crypto research tools out there, Glassnode makes blockchain data accessible to all. It sources, analyzes, and dissects on-chain data to measure the network activity of a cryptocurrency. Glassnode uses the analyzed data to provide useful metrics and actionable insights to investors. You can use Glassnode to explore market indicators and view the number of addresses with successful transactions on a network. You can also access price data and set alerts for timely investment actions using Glassnode. On Glassnode, you get free access to Tier 1 data, which gets updated every 24 hours.
- Messari: Messari is one of the best technical analysis tools catering to the requirements of professionals. Messari aggregates and analyzes crypto data to aid informed decision-making. You get access to several analysis tools on Messari. The tool has plenty of useful filters, like market cap, price, and industry, that you can use to analyze any cryptocurrency out there. Messari is a tool serving both individual analysts and crypto research firms. In a nutshell, Messari provides you with an edge over the crypto market through its professional-grade tools and industry-leading research.
- Coin Metrics: Coin Metrics is a tailor-made platform for financial analysts across spaces. The tool supports over 100 cryptocurrencies and compiles 400+ metrics to organize up-to-date on-chain data. It is a high-end tool specifically designed to meet the requirements of seasoned investors and institutional clients. To simplify, Coin Metrics is the Glassnode of institutional clients. Besides up-to-date market data, Coin Metrics also uses three key indexes to help you manage your digital assets while aiding risk management.
- LunarCrush: One of the most popular crypto research tools out there, LunarCrush is a social intelligence platform for cryptocurrencies and NFTs. Staying ahead of the trend is critical to make regular profits in the crypto market. LunarCrush provides trending social media and market insights on your favorite cryptocurrencies and NFTs. With LunarCrush, you don’t have to search for the latest trends and news across different platforms on the internet. LunarCrush also assesses the impact of a particular news or tweet by an influencer on the price of a token, enhancing your decision-making process.
- CoinGecko: CoinGecko is another great platform for the technical analysis of a cryptocurrency. Preferred by seasoned investors and beginners alike, CoinGecko is the world’s largest independent cryptocurrency data aggregator with 13,000+ cryptocurrencies, 10 million+ monthly users, 10 billion+ monthly API calls, and 8 years + in operation. The platform tracks crypto assets from 600+ exchanges globally. Coin Gecko provides up-to-date token metrics, an in-depth analysis of the market, and community stats from different social media platforms for informed decision-making.
- Santiment: Santiment is very similar to Glassnode in terms of what it does. It is a crypto research tool that provides on-chain, social media, and other critical data on over 2,000 cryptocurrencies. If you are looking for a tool to predict the price movement of your favorite tokens with accuracy, Santiment is a great tool to have. It is a great replacement for the daunting task of studying charts regularly to draw patterns for ascertaining price movements. You can also set alerts on Santiment to get timely updates on any significant movement.
- CoinMarketCal: It is important to stay up-to-date with emerging developments in the crypto market to make timely decisions and cut losses. CoinMarketCal is a reliable analysis platform that covers every relevant news surrounding the crypto industry. It also offers a full calendar, helping you plan your moves in advance. Quite often, we miss important updates like airdrops or token launches of our favorite projects. CoinMarketCal helps you know about these events in advance.
- CryptoQuant: Last but not least, CryptoQuant offers up-to-date data on Bitcoin, stablecoins, and all other cryptocurrencies listed on top exchanges globally. This includes market inflows, on-chain data, and other critical information impacting price movements. The tool has a dashboard where you get updated price charts, newsletters, and other important updates.
Final Word
These are some of the best tools that can transform your investment style, given that you learn to use them properly. However, it is advisable not to rely on a single tool. You must get data from multiple sources to be sure about any decision you make. Seasoned investors and asset managers use these tools to maximize their gains while managing risks effectively. Using a crypto analysis tool saves you time and energy while aiding your decision-making for beneficial investments.