If you’re new to digital currencies, you could be struggling to navigate the waters. It can be daunting with all of the technical concepts, computing jargon, and new key phrases that have never been used before.
To help you get started, we have created a crypto fundamental analysis guide for beginners.
The Importance of Performing Your Own Analysis
When investing in the stock market, it’s critical to analyze the financial health of a company based on its financial statements. Along with the company’s history, you can make a somewhat educated determination of its value and whether it’s worth an investment.
The same goes for digital assets. If you want to make an investment, you should perform some sort of analysis to see if it’s worth your money. Except digital assets are very different to corporations.
There are no financial statements available to help you, and nothing more than a very volatile history to look back on for insight. That’s because there’s no profit to determine value. It’s all based on participation in the community. And, because digital assets are relatively new, there are a limited number of use cases and no track record of performance. You have to perform a fundamental analysis using a different methodology.
So, how exactly do you determine whether a digital asset is worth your time and money?
Find Reliable Sources
Digital assets are new and far from easy to understand. However, having a good understanding of the fundamentals of a digital asset will help you to form your own opinions so you can take a stand where you feel comfortable.
Gather all of the knowledge you can by reading articles written by experts and even by learning what other people think or do. Other people’s experiences with a certain digital asset will help you understand more about how it works.
Check platforms like CoinMarketCap for current value and past performance. This is key to understanding how the digital asset performs. You may…