{"id":26108,"date":"2023-10-22T04:46:02","date_gmt":"2023-10-22T04:46:02","guid":{"rendered":"https:\/\/zebpay.com\/in\/?p=26108"},"modified":"2023-10-22T04:46:03","modified_gmt":"2023-10-22T04:46:03","slug":"day-8-of-navratri-due-diligence-crypto-investing","status":"publish","type":"post","link":"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing","title":{"rendered":"Day 8 of Navratri: Importance of Due Diligence in Crypto Investing"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_66_1 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing\/#Thoroughly_Understand_the_White_Paper\" title=\"Thoroughly Understand the White Paper\">Thoroughly Understand the White Paper<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing\/#Analyze_Governance\" title=\"Analyze Governance\">Analyze Governance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing\/#Understand_Tokenomics\" title=\"Understand Tokenomics&nbsp;\">Understand Tokenomics&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing\/#Seek_Expert_Opinion\" title=\"Seek Expert Opinion\">Seek Expert Opinion<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/zebpay.com\/in\/blog\/day-8-of-navratri-due-diligence-crypto-investing\/#Keep_yourself_updated_on_Regulatory_developments\" title=\"Keep yourself updated on Regulatory developments\">Keep yourself updated on Regulatory developments<\/a><\/li><\/ul><\/nav><\/div>\n\n<p>Due Diligence is one of the most critical aspects of Crypto Investing. Several Analysts believe that due diligence takes precedence over Technical analysis when it comes to Crypto. The reason is that there are over a million Crypto tokens right now. This number will only grow, as Crypto is a highly democratic space where anyone with an idea can participate. However, with such a rapid increase, it becomes even more critical that investors evaluate projects with an objective lens. So, let us now explore five key aspects that one should remember when they are evaluating a crypto token.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Thoroughly_Understand_the_White_Paper\"><\/span>Thoroughly Understand the White Paper<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Reading a crypto token&#8217;s white paper is crucial for investors and enthusiasts. It provides a comprehensive understanding of the project&#8217;s goals, technology, and roadmap. By evaluating the white paper, you can assess the project&#8217;s legitimacy, innovation, and potential for growth. It helps in making informed investment decisions, identifying red flags, and gauging the team&#8217;s expertise. Most importantly, the White Paper will detail the problem which the crypto is trying to solve. If you consider the solution provided by the crypto project to be legitimate, you can go deeper into your due diligence process.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Analyze_Governance\"><\/span>Analyze Governance<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>One of the most critical aspects which blockchain technology and crypto are trying to disrupt is centralised power. Blockchain transfers the power to the end user. For example, Robert Kiyosaki famously called Gold as \u201c God\u2019s Money\u201d and Bitcoin as \u201c People\u2019s Money\u201d. For this reason, it is important to understand the governance model of a crypto project. While there are a few centralized projects such as <a href=\"https:\/\/zebpay.com\/in\/blog\/what-is-ripple\" target=\"_blank\" rel=\"noreferrer noopener\">Ripple (XRP)<\/a> which are making phenomenal changes, the most prominent Crypto tokens- Bitcoin and Ethereum are decentralised.&nbsp;&nbsp;<\/p>\n\n\n\n<p>Read more: <a href=\"https:\/\/zebpay.com\/in\/blog\/bitcoin-vs-ethereum\" target=\"_blank\" rel=\"noreferrer noopener\">Bitcoin vs Ethereum<\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Understand_Tokenomics\"><\/span>Understand Tokenomics&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Another crucial aspect which will determine the price trajectory of a Crypto project is its supply and demand dynamics. There are some crypto tokens like Bitcoin which have a finite supply and are deflationary by design. On the other hand, Ethereum has an infinite supply but is also known to be deflationary. This makes it harder for miners or stakers to generate Bitcoin and Ethereum as time passes. It is critical to fully understand the distribution of the crypto token amongst the community. Ask important questions like &#8211; \u201c Who holds the majority of the tokens?\u201d \u201c Is the price of a token exposed to massive drawdowns because of centralization?\u201d and more.&nbsp;<\/p>\n\n\n\n<p>Read more: <a href=\"https:\/\/zebpay.com\/in\/blog\/what-is-tokenomics\" target=\"_blank\" rel=\"noreferrer noopener\">What is Tokenomics<\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Seek_Expert_Opinion\"><\/span>Seek Expert Opinion<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>While investing in a token has to be your sole decision, it is helpful to seek advice from well-known experts to get a better <a href=\"https:\/\/zebpay.com\/in\/blog\/guide-to-evaluate-crypto-projects\" target=\"_blank\" rel=\"noreferrer noopener\">understanding of a crypto project<\/a>. The Crypto community is vibrant with seminars and expert talks happening all over the world. You can consider attending these expert talks where you can network with like-minded individuals. Remember to not send your funds to anyone else asking them to invest for you. Be proactive in seeking knowledge, but be the sole owner of your funds.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Keep_yourself_updated_on_Regulatory_developments\"><\/span>Keep yourself updated on Regulatory developments<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Governments are actively working towards setting up roadmaps and frameworks for the Crypto industry. The International Monetary Fund and the Financial Stability Board recently published regulatory recommendations for the Crypto industry. With rapid advancements shaping the industry, it is important to stay informed all the time.<\/p>\n\n\n\n<p>Read more: <a href=\"https:\/\/zebpay.com\/in\/blog\/day-7-of-navratri-understanding-crypto-market-cycles\" target=\"_blank\" rel=\"noreferrer noopener\">Day 07 of Navratri Crypto<\/a><\/p>\n\n\n\n<p>To learn more about Crypto, <a href=\"https:\/\/zebpay.com\/in\/blog\/what-is-web-3-0\" target=\"_blank\" rel=\"noreferrer noopener\">Web 3<\/a> and Blockchain, visit ZebPay blogs. Click on the banner below to join the millions taking part in the Navratri festive celebrations. Stay tuned for our final blog in this series which is about \u201c The Future of the Crypto Landscape\u201d.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><a href=\"https:\/\/zebpay.com\/in\/navratri-crypto-trading-utsav?utm_source=blog&amp;utm_medium=banner&amp;utm_campaign=navratri\" target=\"_blank\" rel=\"noreferrer noopener\"><img decoding=\"async\" width=\"1024\" height=\"512\" src=\"https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08-1024x512.jpg\" alt=\"Navratri Crypto Banner Day 08\" class=\"wp-image-26109\" srcset=\"https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08-1024x512.jpg 1024w, https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08-300x150.jpg 300w, https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08-768x384.jpg 768w, https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08-150x75.jpg 150w, https:\/\/zebpay.com\/in\/wp-content\/uploads\/2023\/10\/Navratri-Crypto-Banner-Day-08.jpg 1062w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/a><\/figure><\/div>\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Due Diligence is one of the most critical aspects of Crypto Investing. Several Analysts believe that due diligence takes precedence over Technical analysis when it comes to Crypto. The reason is that there are over a million Crypto tokens right now. This number will only grow, as Crypto is a highly democratic space where anyone [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":26112,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"_ayudawp_aiss_exclude":false,"footnotes":""},"categories":[14],"tags":[16],"acf":[],"_links":{"self":[{"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/posts\/26108"}],"collection":[{"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/comments?post=26108"}],"version-history":[{"count":2,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/posts\/26108\/revisions"}],"predecessor-version":[{"id":26111,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/posts\/26108\/revisions\/26111"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/media\/26112"}],"wp:attachment":[{"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/media?parent=26108"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/categories?post=26108"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zebpay.com\/in\/wp-json\/wp\/v2\/tags?post=26108"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}