Get Our Updates in Your Inbox

Sign up for up-to-date and interesting information and news about bitcoin - delivered hot off the keyboard to your inbox.

Close
Back

How to Evaluate Cryptocurrency for Investment - Company and Community Strength

Liz Louw
13 July 2018

Note: This blog is part 4 of a 4-part series.

Our newly launched ebook “How to Find the Best Cryptocurrency to Invest In - 2018 Edition” explores three categories of cryptocurrency fundamentals - coin utility or purpose, economic and technological foundation, company and community - and provides you with some sub categories by which you can assess the potential value of a cryptocoin or blockchain. Here’s the fourth excerpt from the eBook that is available for (free) download over here.

How Does the Leadership of the Blockchain Project Measure up?

As a first step to evaluating the strength of the company and community behind the project, it is important to research the individuals in leadership and advisory positions. Take a look at the founders, company management, developers, investors and the community behind the project. Warning signs that the project might be a scam include the absence of a team and source code that is unavailable.

Assess the Team Leadership's Strength:
  • Does the executive lead (CEO, COO, executive lead, founder, managing partner etc) have experience of managing multi million dollar/pound/euro companies?  
  • Does their experience include blockchain projects?
  • Have they improved their company performance (balance sheet) during their serving time?
  • Do the leaders deserve sole credit for decisions that delivered success in past ventures or are they taking credit for a team effort?
  • How many years of executive leadership experience does each leader have?
  • Does the technological lead have experience of managing multi million dollar/pound/euro projects?
  • How many years of technological leadership experience does each leader have?
  • Does the team include dedicated Quality Assurance members?
  • How does the size of the Sales/Marketing team size compare to those of other coins?
  • How does the total team size compare to those of other coins?
Assess the Advisory Board’s Strength
  • Does the project have advisors with bios on the website, and have the advisors confirmed their involvement in project?
  • Do at least two of the advisors have experience of managing multi-million dollar/pound/euro companies?
  • Have any of the advisors won awards or been awarded accolades, i.e. Bloomberg recognition, Fintech awards, ‘30 under 30’ lists? These are the type of advisors that can really gear a project for success.

Community Support

While we have seen scenarios where coins lacking any utility have amassed tremendous followings (e.g. Dogecoin), even a coin with great utility stands to struggle to gain adoption if it lacks community support.

Assess Brand Awareness:
  • What is the coin’s total community size compared to other coins, e.g. Facebook, Twitter, YouTube, Reddit.
  • Does the coin have a GitHub community dedicated to testing and improving the project?

Fundamentals Are King in Cryptocurrency Investment

While the full list of coins in a Bitstocks’ investment portfolio remains a trade secret, our CEO Michael Hudson has publicly declared our commitment to investing according to the fundamentals instead of market hype and speculation.

We play the long game: we do our research on the viability of a coin early on, then hold on through the turbulence of the cryptocurrency market. Follow our example and you will be able to HODL with confidence too.

Remember: One of the golden rules for cryptocurrency investment is to stick to an amount that reflects your comprehension of the market and the underlying technologies, and no more than you can afford to lose. If you are uncertain, it would be wise to contract cryptocurrency market advice.

How to Find the Best Cryptocurrency to Invest In

Learn how to assess the investment potential of cryptocurrency coins and tokens.

Download
Market Advisory Desk
0203 743 2228
OTC Dealing Desk
0203 743 2229