1. Fundamental Analysis (FA) for Crypto
FA involves evaluating the intrinsic value of a cryptocurrency by analyzing its underlying factors.
Key FA Metrics:
• Project Fundamentals:
• Whitepaper: Study the goals,
tokenomics, and use cases.
• Team & Partnerships: Ensure transparency and expertise.
• Roadmap: Look for realistic timelines and developments.
On-Chain Metrics:
• Active Addresses: Higher activity indicates strong usage.
• Network Value to Transactions (NVT) Ratio: Similar to a P/E ratio for cryptos; lower is better.
• Hash Rate (for POW coins): Higher hash rates suggest stronger network security.
Market Metrics:
• Market Sentiment: Use tools like Fear & Greed Index.
• Liquidity & Volume: Ensure the asset has sufficient market depth for trading.
• Exchange Reserves: Declining reserves may signal higher buying pressure.
Macro Factors:
• Regulatory Updates: Stay informed about laws affecting crypto.
• Global Events: Monitor news that might impact sentiment (e.g., inflation, Fed rate changes).
Tools for FA:
• Glassnode/IntoTheBlock: For on-chain analysis.
• Crypto News Aggregators: CoinDesk, The Block.
• Social Media Trends: Use LunarCrush for real-time sentiment analysis.
