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How to conduct a fundamental analysis of cryptographic investments
The world of cryptocurrencies has gained immense popularity in recent years, attracting a wide range of investors from various environments. However, investing in cryptographic can be highly speculative, which means that it is necessary to conduct a thorough fundamental analysis before making investment decisions. In this article, we will examine the foundations of fundamental analysis and present step -by -step guidelines on how to carry out a comprehensive analysis of cryptographic investments.
What is the basic analysis?
Fundamental analysis refers to the process of assessing the internal value of assets based on its basic economic and financial characteristics. It includes data analysis such as market capitalization, revenue increase, profitability, competition, management team, industry trends and more to determine whether a given cryptocurrency has a great potential for long -term growth.
Why is fundamental analysis important in Crypto?
On the cryptographic market, fundamental analysis plays an important role in the identification of underestimated assets that can increase significantly. It should be noted, however, that the cryptocurrency market is very unstable and prices can change quickly. Therefore, investors must be prepared to adapt their strategies as market conditions evolution.
Step by step guide after a fundamental analysis for cryptographic investments
- examine the cryptocurrency
Start by examining the cryptocurrency in which you are interested in investing. Look at his:
* Programming team
* Case of use and purpose
* Market demand and adoption
* Technical analysis (e.g. charts, chart)
- Rate its economic characteristics
Rate the following factors:
* Market capitalization: Compare it with other cryptocurrencies in the same space
* Revenue rate: assess cryptocurrency revenue streams and the potential of future growth
* Profitability: analyze the cryptocurrency profity and cash burning margin
- Analyze its competition and market position
Examine the competition by:
* Identification of key players on the market
* Assessment of their strengths, weaknesses and strategies
* Market share assessment and consolidation potential
- Review industry trends and perspectives
He examines trends and perspectives in the space of cryptocurrencies by:
* Reading reports and industry research
* Consulting with experts in related fields
* Analysis of regulatory changes and changes in government policies
- Rate the management team and advisers
Rate:
* Experience and achievements of key team members
* Background and certificates of advisers
* Potential of interference or innovation
- Look at the regulatory frames and compliance
Examine the following factors:
* Governmental regulations and their impact on cryptocurrency space
* Requirements for compliance and potential risk
- Do technical analysis of the charts
Rate the charts to identify:
* Patterns and trends in price movements
* Levels of support and resistance
* Indicators such as RSI, MacD and Bollinger teams
Example: Bitcoin fundamental analysis
Let’s use Bitcoin (BTC) as an example:
- Market capitalization : Compare BTC with other cryptocurrencies with market capitalization similar to 30% of the total market.
- Team of programmers
: Rate the current team leadership structure and the potential of future growth.
- Economic characteristics :
* Revenues: Bitcoin revenue streams include transaction fees, mining income and advertising.
* Profitability margin: BTC has a relatively high profitability margin due to high market capitalization.
- Competition : Compare BTC with other cryptocurrencies with similar features in the same space.
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