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How to analyze tokens?

by Admin
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Quite often, cryptocurrency investors suffer losses due to failed analysis. Many avoid making their own decisions regarding the purchase or sale of assets, preferring to shift the responsibility to trading channels, opinions of influencers or even statements of famous personalities such as Ilon Musk. Let’s take a look at the basic principles of analyzing any new token recommended for purchase in the internet space.

Let’s take an example with the Binance exchange and launching the HOOK token in the Launchpad.

How to analyze tokens?

Usually, you can get a personal message to email, messenger or social network, not from Binance, but from “left” people, offer to buy token on PancakeSwap cheaper and before listing. I really want to buy it, but how not to get scammed?

Always check the token on CoinMarketCap

As a first step, check out CoinMarketCap and verify the token in question there. If you find that the token is not yet traded and the status is listed as ICO, this indicates that the coin is not currently on the market and the offer to buy it may be a scam.

Check the announcements

After you have found the HOOK token on the CoinMarketCap page, go to the Twitter and Discord sections of the project. Study the announcements for the last month in the official accounts. If you don’t find information about trading the token on Pancake or participating in other airdrops, it may be a sign of fraud.

It is also worth visiting the token’s official website and studying information about the project: what problems it solves, the composition of the development team, the level of investor support, and so on. These additional steps can help you form a more informed opinion about the HOOK token and make sure it is legitimate.

Check the contract

If someone offers you to buy a HOOK token before it is listed on Binance, be extremely cautious. Attackers can publish a scam token contract pretending to be a real token and provide instructions on how to buy it on Pancake.

It is important to remember that you should never copy token contracts from Telegram feeds. All official contracts are usually available on platforms such as CoinMarketCap, Coingecko, DropsTab, Cryptorank, and in the white papers (whitepapers) of each project. Verifying information on reliable sources is a key step to avoid fraud and secure your investment.

Read the Whitepaper

CoinMarketCap has a link to the whitepaper of each project. It is desirable to look through the documents, the project’s tokenomics, and find out what this project does.

See where the token is trading

A popular question: “Where to buy this or that token/coin”. You can get the answer on CoinMarketCap – enter the token you are interested in into the search – go to the “Markets” section. You will see a list of all exchanges (CEX and DEX) where the token is traded.

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