HOW TO #DYOR FOR 7 YEAR OLDS“DYOR” translated as

“Do Your Own Research” is a common phrase you’ll be

seeing under a lot of Crypto tweets but do you know what
to Research on? This thread explains all you need to know
before you buy a Coin
This Topic will come in 2 threads as it’s very length (Took me a whole day to write.

There are a number of things you need to take note of when buying a new coin, this form
of research is what is termed Fundamental Analysis.

It involves taking a deep dive into the available information about a Coin. For instance, you
might look at its use cases, the amount of people using it, or the team behind the project.
Your goal is to reach a conclusion on whether the asset is overvalued or undervalued.

Here are highlights of Fundamental Analysis I do before buying a Coin

1. White Paper - A white paper is a document that outlines what a cryptocurrency is created
to do and how it will achieve it. A few things you should look out for in the white paper are:

•The Description of the Project and how it’s going to provide solution to a real and relevant
problem. •The use case(s) it aims to cater to •The roadmap for upgrades and new features
•The supply and distribution scheme for coins or tokens •The Team

2. Tokenomics Tokenomics show you the total supply of the coin, how it is distributed
among the creator and the team, and how much is available in circulation. Also if there is
any information to suggest that a large number of coins has been burned or rendered
unusable.

3. Initial Distribution Another important factor to consider is how the funds were initially
distributed. Was it via an ICO or IDO or Airdrops? What percentage of tokens were set aside
for the founders and the team.
Paying attention to the distribution should give you an idea of any risk that exists. For
instance, if majority of the supply is owned by only few addresses, we might reach the
conclusion that this is a risky investment, as those people could eventually manipulate the
market.

4. Date of release (All time low) - The date of release in comparison with the current price
can suggest if a Coin is Overvalued at the time. For example if a Coin released in less than 3
days has done 5x (500%) or more, then that’s a recipe for disaster.

The Coin is obviously moving with Pump and a few major withdrawals could send it to hell
in minutes. If you got in earlier then it’s time to jump out, if you didn’t then stay away from
it or wait for the Fall if you must buy in.

5. All time high (ATH) - This is the highest price a cryptocurrency has attained. The all time
high in comparison with the current price can tell you if you have a chance of making profit
Hodling for a little while or longer or have an increased chance of losing your money

For example: $BNB hit $686 ATH but it’s current price is at $503 almost $200 less. The
chances of me making profit from here is higher. If the Current price is the ATH then buying
in at that time is just FOMO, you might need to wait a while for a retrace.
6. Current Price - Without being told, the current price is what you’d compare to everything
else so it’s one of the most important things to look out for. For example, a lot of people
won’t want to go for $BTC at $50k+, they’d rather buy a $Bake at $6 cos’ they’d get more
units.

7. Market Cap - The Market Capitalization can let you predict how many more % higher the
coin can go. While you cannot accurately predict this, you can make a good guess using the
MCap.

For Example: $AFEN has a MCap of just $25M, I could predict that it still has a chance of
doing 5-10x from here because 10x will take the MCap to about $250M and that’s kinda
realistic. (Pls note that this example is not a financial advice, it’s only for educational
purpose)

We’ll be stopping here for this Part. Liquidity, Community, Trade Volumes, and more will be
covered in the next part. Keep Notifications on so you don’t miss a thing.