How To Correctly Evaluate A Crypto Project

Strong communities are the backbone of crypto projects

It’s quickly become the case that new DeFi and NFT projects are successfully using IDOs to list tokens, benefiting from advanced features and fairer methods that give improved visibility and empower uses, among others.

Examining the project team’s talents and experience can give you assurances that the project has the necessary blend of ability and know-how in dragging the project past milestones, while also giving you a good idea of how sustainable their development is over the long term. The same goes for their community, how healthy they are and their motivations will tell you if it’s just a project filled with short-term profit-takers, or true enthusiasts who ultimately decide the lifetime of the project.

1. Three Criteria of A Good IDO Team

1.1 Track record

The first port of call should be the team behind the project. Who they are and what they can do is less important than what they have done. An anonymous team isn’t necessarily worse than a team with names and photographs.

Be wary of those serving as project advisors but in reality are only there to lend their high-profile name to the project to get as many people on board as possible! Many of these types of advisors are doing little more than shilling these projects to their online followings, moving on as soon as they’ve made their profit from dumping their tokens (or “advisory fee”) onto unsuspecting newcomers.

Finally, watch out for highly-qualified teams with seemingly every possible coding language and expertise in their locker, but without any actual completed projects or professional achievements. You don’t want to be saddled with a project that doesn’t know how to actually push out finished products.

Look for past achievements. IDO projects can be notoriously difficult to see through to the end

Watch out for red flags. Check the team’s track record for any blemishes or past negative associations

Study the advisors. Look up the members of the advisory board. Unfortunately, many advisors exist solely to lend their name but aren’t actually involved in any meaningful way. If someone holds many advisor roles at the same time, can they truly contribute anything?

1.2 Developers

IDO projects, if distilled to an end result, are essentially technology developers and product experts working to build a product that successfully implements features using blockchain technology. Like it or not, this means the beating heart of the project is its code. Because blockchain is still a new industry, there is a lack of high-end developers able to create robust infrastructure — hence the many hacks and exploits in the space due to poor coding backbone.

Is there really a code? Open-sourcing can clarify this, but security audits of closed-source codes also help you ensure they really do have developers.

1.3 Transparency

Transparency is a big deal in the crypto space and more people, whether users or investors, demand as much transparency as possible from projects they invest in.

Some projects even have a place for development updates, keeping their communities abreast of developments and of progress towards it. Some companies only announce things on social media or through PR campaigns, while others make personal contact on Telegram or Discord, or arrange for live streams for people to join.

How does the team communicate and how often? Generally, the more willing a team is to communicate, the better the project is, because a fake IDO won’t dare to talk to people if they aren’t actually developing anything!

How do they handle bad news? When something bad happens, are they the first to inform or do they generally end up explaining themselves every time there’s a negative event? Good IDOs aren’t afraid to be honest when things don’t go as planned.

2. Two Criteria for A Good Crypto Community

2.1 Social media – where they live

If people can be defined by the company they keep, then it’s almost certainly true that IDO projects are defined by the communities they have, and where they choose to live.

Is the community active and healthy? Differentiate between the short-lived white noise from shillers and speculators, and sustainable sentiment from users and enthusiasts.

2.2 Positivism – how they grow together

Crypto Twitter and Reddit are such diverse and active platforms that have the most active and engaged people coming together under a common banner of crypto use. But it isn’t enough just to have hundreds and thousands of users talking about the product and enjoying it.

How does the community treat newcomers? Watch out for elitist projects that are condescending towards clueless newcomers. 

Who are the leaders? Every community has informal leaders, personalities that they look up to and speak on behalf of the project. Are they knowledgeable and nurturing? Or are they antagonistic and argumentative? Crypto projects that have the latter as leaders tend to burn bridges… and put off potential users.

Of course, there are many more things to consider when trying to find good IDOs, particularly from a technical standpoint, but when it comes to the intangibles, we truly believe that people are the backbone of any good project — be they developers creating the product, or users giving the product true value.