Guides to Cryptocurrency and Blockchain Investment
Identifying an Effective Team
How can an investor know if a Crypto Project is led by an Effective Team?
One of the most essential researches to do before investing in a cryptocurrency or blockchain project is to analyze the project leaders and the team. An investment product or project with the highest potential and best technology in the world will still fail if its team is inefficient and uncommitted.
There are ways to spot an efficient or an incompetent group, a trustworthy or a dishonorable organization, a winning or a losing team etc. by referring to the following guidelines:
1. Read the White Paper
A well-organized valid project with substance will have a detailed white paper (usually released by a marketing team) that contains vital information about the project and the overall team as follows:
Go ahead to study the team structure as stated on the white paper. A team which has a good organization structure and consists of a chief (eg. a CEO), Technology Head, Decision Committee, a marketing department, a R&D department with strong committed leaders, is more likely to be well coordinated and organized as compared to a team with only a handful of staff running the show.
You should not trust the document completely; do your own research on top of reading the white paper by searching the web (eg. on google search engine) for articles or records of those team members, especially the founders. Leaders and developers with a good history or CV of project completions (especially on blockchain), and have their successes reported or recorded on the web, should obviously be considered favorably as compared to unknown people, or at worst, someone with a history of failures, delays or deceits recorded.
Vision and Roadmap
A good team should have a project vision and a clearly defined roadmap with a detailed work plan for at least the next 12-24 months. A team will more likely be successful if they have a strong business plan of both short and long term, other investors will examine those as well to decide if it is worthwhile for them to invest their money into the project.
News of a team who constantly delays the time frame as stated on their project roadmap are possible indications of poor planning or incompetency and should be part of your investment considerations.
2. Research the Founder or Principal Leader
Majority of the crypto projects on the market are scams. Researching the founder or the top ranking leader of a project helps to rule it out as a scam. For example, if the leader is already successful and owns another bigger business that is doing very well, he/she will less likely develop a scam product to risk ruining the success and reputations of his/her existing business.
3. Observe Frequency of Progress Updates
Check out how frequent the team provides progress updates. As compared to a silent team, a team is more likely to put in real work and more efforts to develop a product when they provide regular status updates that can be verified on a transparent and open-source blockchain project. There are many scam crypto projects out there and a lot of them do not provide any progress updates. Do not take the chance on a silent team, instead, put more trust on a team that is obviously working hard to develop the product.
4. Visit Social Media Profiles of Key Leaders
Social media profiles of leaders, especially the founders, provide investors with a lot of updated valuable news, information and opinions of their projects. You will be able to view healthy debates between the leaders, users and other crypto experts; hence you are not getting only one side of the story.
Sometimes founders may post out messages that are positive to investments as follows for example.
Sometimes founders may post messages that will alarm the community too. An example message from Litecoin founder on Dec 2017 is shown below.
His prediction turned out to be correct, LTC price dropped from $163.44 after he posted the above message on 11 Dec 2017 to $22.92 on Dec 2018. Those that saw his message and followed his advice probably saved themselves at least a small fortune. Founders will not be right all the time, but they are influential, experienced and know a lot about their own coins.
However, you will have to be careful of malicious unknown people commenting under profile messages of those leaders to impersonate them and scam others, for example, commenting that if you send them some cryptocurrency coins to verify yourself for a promotional event, they will send you back more than 10 times of that amount. Ignore those comments and always remember that nothing is free.
The following list will provide you with the links of social media accounts belonging to prominent crypto leaders: