Cryptocurrency Fundamental Analysis

Cryptocurrencies are challenging to perform fundamental analysis on due to their speculative nature and lack of a use-case or, in many cases, companies backing them or executive teams making decisions on the project’s behalf.

In Bitcoin’s case, there is no team of developers, marketing team, or CEO running the show. It’s a fully decentralized autonomous network kept in operation by miners powering the network and an incentive system that generates a sum of BTC for doing so.

Because mining is so essential to Bitcoin’s operation and network health, this is where analysts will focus their fundamental efforts.

Additionally, things like on-chain transactions, the value each network transacts per day, and many other metrics can be helpful to understand.

Reading an asset’s whitepaper and researching any related development team and the support of its community should act as the foundation for any cryptocurrency fundamental analysis.

Unique tools for determining the health of the Bitcoin network have been developed, that blur the line between fundamental and technical analysis.

Whatever methods you ultimately choose is less important than conducting extensive research as a whole. You are putting your money on the line, so investing time and effort into understanding what you are about to invest in as an asset, is also critical to success.

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