How I Evaluate a Crypto Investment: Project, People, PriceFebruary 8, 2019
If you’re a new crypto investor or a trader, you’ll quickly find there many excellent projects for you to invest in. The possibilities seem endless. You can browse the Internet and find articles and trading recommendations on literally thousands of cryptocurrencies. At the beginning of my journey into crypto investing, I was quickly over whelmed. I needed help!!
How does someone evaluate a possible cryptocurrency investment? What are the best criteria to use when looking at a project? These are just some of the questions I was asking myself back in 2017.
I tend to invest in projects I can easily understand and that I connect with. For example, I once saw an ICO that had something to do with putting the production of cow milk on the blockchain. This might have been a great investment but I am not all that interested in cow milk. Does that make sense? I tend to gravitate to projects that help the poor or unbanked people improve their quality of life. Those are projects I can get really excited about. This is a bit of an oversimplification but I think you get my point. I like projects that solve real world problems in a practical manner.
Once I have identified and chosen a project I can connect with, I then look at whom are the people leading the project. I do a thorough research into the team members, their experience, and what other people say about them. You can have a great project but if the leaders have little on no experience or expertise, chances are it could fail. On the other hand, if a project has a solid team of veterans who are extremely competent in their field, my confidence level becomes greater. A lot of what I’m saying is common sense. I probably do most of my research on the leaders when evaluating of possible crypto investment. I would estimate I spend anywhere between 10 to 15 hours checking the team members of any given project I’m looking at. I’m responsible for doing my own due diligence.
Once I’ve identified an interesting project that has great leaders, the last thing I look at is the price. While price does play a part in my decision to invest, it’s not high on my priority list. Some crypto investors I’ve met only invest in ICO’s or projects under $10. I never understood this logic and this is not something I would do personally.
The cryptocurrency market is still in its infancy. At the time of this article, the whole market is down almost 80 to 85%. Prices have been beaten down for almost a year. Don’t be misled by the price. If you feel confident about a project and the team members, the price should not be a high factor in deciding to invest in it or not.
When investing, I tend to be a simple man with a simple plan. Use this article to learn from. Read other articles and see what others are saying. Develop your own way to evaluate the projects you want to invest in. You work hard for your money. Invest wisely!
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