Learning the friendly way

Before you invest in any crypto projects or assets, the golden rule is to always do your own research (DYOR). Hearing about a new coin from your neighbor or cousin's friend on Facebook is great, but it still requires a sizable chunk of your own research. Before you part ways with your money in the crypto space ensure that you've weighed up both the risks and the potential, the responsibility lies with you.

Crypto investing has a track record of being volatile, so the more clued up you are on the crypto assets you invest in, the better. While market data and fundamental analysis are important, be sure to understand the basics of a project and the project's potential.

What is DYOR (do your own research) in the crypto space?

The holy grail of investing in crypto projects, DYOR has become a common abbreviation for do your own research. The phrase is used to remind crypto investors that they should conduct their own research on a crypto project thoroughly before investing any money in it.

Whether you're looking to buy crypto assets, tokens, NFTs, or in any way get involved with a crypto project, be sure to thoroughly investigate the following factors mentioned below when doing your own research. Don't be lured in by a project's fundamental analysis, ensure that you understand everything there is to know about the project. Crypto investing can have devastating consequences for uninformed investors.

The 4 dimensions of how to DYOR on a crypto project

Below we will outline the four main dimensions of conducting your own research on a new cryptocurrency. These four pillars will give crypto traders a solid understanding of what the project represents, how it's been received, and what might happen in the future. Be sure to do this before looking at any technical analysis.

Remember, doing your own research requires reading multiple sources and verifying that the information is correct. When conducting your own research you mind find some disputing information, continue looking until you have the accurate answer.

Team

First and foremost, who is the team running this project? This information is typically presented on the platform's website or in its whitepaper (it's imperative that a project has both of these).

Take a look at the size of the project team, a small team might fall apart if one of the three members leaves while an excessively large team might be a red flag if it is still in its early days.

Check the experience of the leaders on the team. Ideally, you want leaders and executives to have experience in blockchain, Web3, finance, business, computer science, or any other related fields. Also, consider whether their current titles match their experience.

Are the team entirely anonymous? This is considered a red flag as the potential for them to execute an exit run is high. Consider the leaders of the project carefully and decide whether they have the means to steer this ship in the right direction.

Tokenomics

Tokenomics refers to the factors related to the supply and demand of a coin or token. The term merges "token" and "economics" and provides a key area of study for potential investors when establishing a coin's long-term viability. Below are the main aspects of tokenomics:

• Token supply: what is the maximum supply of coins or tokens?
• Token utility: what is the purpose of the coin (does it have governance rights, does it serve a specific function)?
• Market cap: How does the coin's market cap compare to that of its competitors?
• Issuance tactics: does the project intend on conducting token burns or any related activities?
• Minting, allocation, and distribution: how are the coins minted (all at once, gradually), when launched how are the tokens distributed, do a small number of members hold a large amount, are any coins locked up that will be released to the market on a specific date?
• Trading volumes and liquidity: what kind of volumes does this coin trade and how much liquidity does it have?

Innovation

For this pillar of the project, you want to look at what problem this project is solving, and what edge it has over its competitors. It's also worth taking a look at the project's road map and whether it is delivering on its self-set milestones. No roadmap is a red flag, well-managed projects are transparent and eager to release their milestone accomplishments.

Ideally, you want to establish what solution this project is bringing to the greater industry and what competitive advantage this project holds over similar projects. Consider its weaknesses.

If you want to take things one step further, consider what the team might not be telling you, and what elements could work against the growth and success of the project.

Social

This might not seem essential, but social media platforms can offer significant insights into the project's community, achievements, and current state within the crypto space.

When conducting your crypto research check whether the project has active official social media channels, and how often these are updated.

Secondly, how big is their community both in terms of followers and engagement? Are people engaging with the platform or talking about it on their own channels? Community members can shed a big light on how the project has been received.

Lastly, what kind of discussions are being had within the community of these groups? Are people friendly and inviting, or are they blindly promoting the project and pushing "lambo" sentiments? Ideally, you want to have a space where open and honest discussions can be had and constructive criticism accepted.

Toxic communities along with shillers and abandoned channels are all red flags.

The bottom line for DYOR and crypto projects

Establishing these four dimensions of a project is important prior to investing any money. Not only does it give you the opportunity to learn about a new project, but also to become better acquainted with what is happening in the crypto space.

Through the process of conducting your own research, you might discover a viable gem or even gain access to exclusive airdrops as an early supporter. Bear markets are a great time for diving into DYOR explorations.

The crypto market has entered a phase that veterans often call the "boring zone." It's a time when:

• Bitcoin's price seems stuck, fluctuating between $50,000 and $70,000 for months.
• Altcoins are in an even deeper slumber, with many down 50-80% from their peaks.
• Trading volumes on major exchanges have plummeted, dropping 30% from the last bull market's heights.

Sound familiar? It should. This lull is a recurring theme in the crypto market cycle, and historically, it's often the calm before the storm. It’s also a common attribute after a recent Bitcoin halving. 

Let's look at what happened after previous Bitcoin halvings:

• 2012 Halving: 92 days until new all-time high
• 2016 Halving: 291 days until new all-time high
• 2020 Halving: 216 days until new all-time high

For perspective, 28 July 2024 marks 100 days from the most recent halving, with 25 February 2025 marking the 300-day mark. 

The power of patient investing

Investing in cryptocurrencies over longer time horizons can be likened to early-stage venture investing, where patience could potentially lead to significant returns. While past performance doesn't guarantee future results, historical examples like Ethereum and Solana demonstrate this potential. 

Ethereum, launching at less than $1 in 2014, and Solana, starting below $1 in 2020, have since seen their values grow to over $3,000 and $140 respectively as of early 2024.

In the crypto space, what’s known as the HODL approach, emphasises the power of time and compound growth, similar to that of traditional asset classes. The idea is straightforward: if you've taken a position in a project you believe has strong fundamentals, maintaining that position through periods of high volatility could potentially lead to significant gains.

To illustrate this point further, in 2010, Bitcoin was worth less than $0.01. By April 2024, it had reached around $70,000. An investor who bought $100 worth of Bitcoin in 2010 and held it until 2024 would have seen their investment grow to millions of dollars.

Strategies for surviving (and thriving) in the "boring zone"

During quiet periods in crypto dive deeper into blockchain fundamentals, research promising projects, instead of anxiously checking prices or reacting to every piece of news, use this time productively.

Alternatively, for those with capital to invest, dollar-cost averaging (DCA) could be something to consider. A Vanguard study found that DCA outperformed lump-sum investing in 68% of cases during market downturns, highlighting its potential effectiveness in notoriously volatile markets.

Know with certainty that this "boring zone" is often temporary. Based on previous cycles, we might see a new Bitcoin all-time high in 30 to 150 days, and once Bitcoin breaks its previous record, top altcoin projects have historically seen gains of 200% to 1,000%.

By staying patient and disciplined during quiet periods, you can be prepared for potential opportunities that may arise as the crypto market evolves. Remember, while historical patterns offer insights, they don't guarantee future results, but these historical patterns are worth considering as you plan your strategy.

We get it, the waiting game is hard

Holding onto your crypto during boring market times can be tougher than you'd think. When prices aren't moving much, it's easy to get antsy or start doubting your choices. But keeping a cool head and being rational is key to long-term success.

First off, remember why you got into crypto in the first place. Was it the tech? The potential? Keep that big picture in mind. It helps to set realistic expectations too - crypto's known for its ups and downs, so flat periods are normal.

Try to limit how often you check prices. Constantly peeking at your portfolio can drive you nuts during slow times. Instead, focus on other parts of your life or dive deeper into learning about blockchain.

Connecting with other crypto fans can help too. Chat about ideas, not just prices. And don't forget to celebrate small wins - even if the market's quiet, projects are still developing and growing.

Stay patient, stay curious, and remember: in crypto, today's boredom could be tomorrow's excitement.

‍

What is a stablecoin?

A stablecoin is a cryptocurrency that aims to keep its value consistent with a specific asset or group of assets, in other words, its value is pegged to the underlying asset. Unlike volatile cryptocurrencies such as Bitcoin or Ethereum, stablecoins aim to provide the benefits of digital currencies without the wild price fluctuations. Most commonly, stablecoins are pegged to fiat currencies like the US dollar, with one coin typically equaling one dollar.

How do stablecoins maintain their value?

Stablecoins use various mechanisms to maintain their peg:

1. Collateralised stablecoins

These are backed by reserves of the pegged asset. For every stablecoin issued, there should be an equivalent amount of the asset held in reserve (in a bank). Examples include USDC and USDT.

2. Algorithmic stablecoins

These use smart contracts and algorithms to automatically adjust supply based on demand, theoretically maintaining the peg. An example was TerraUSD (UST) before its collapse.

3. Hybrid models

Some stablecoins combine collateral backing with algorithmic mechanisms.

Maintaining the peg often involves continuous market operations, such as minting new coins when demand increases or burning excess supply when demand decreases.

What does it mean when a stablecoin depegs?

When a stablecoin "depegs," it means its value has deviated significantly from its intended peg. For instance, if a USD-pegged stablecoin trades at $0.95 or $1.05 instead of $1.00, it's considered depegged. Minor fluctuations are normal, but substantial or prolonged deviations indicate a problem.

Why does this happen?

Stablecoins can depeg for several reasons:

1. Market pressure: Extreme market conditions can lead to massive sell-offs, overwhelming the stabilising mechanisms.
2. Loss of confidence: If users doubt the stablecoin's backing or the issuer's credibility, they may rush to sell, causing a depeg.
3. Insufficient collateral: If a stablecoin isn't adequately backed by reserves, it may struggle to maintain its peg during high-stress periods.
4. Algorithm failures: For algorithmic stablecoins, flaws in the stabilising mechanism can lead to depegging.
5. Regulatory issues: Legal challenges or regulatory crackdowns can shake confidence in a stablecoin.
6. Liquidity crises: If there's not enough liquidity in the market, it can be difficult to maintain the peg.
7. External economic factors: Major economic events or changes in monetary policy can affect a stablecoin's stability.

What are the consequences of a stablecoin depegging?

The consequences of a stablecoin depegging can be severe and far-reaching:

Loss of user funds

Investors holding the stablecoin may face significant losses if the value drops substantially.

Market volatility

A major stablecoin depegging can trigger broader crypto market sell-offs and instability.

Loss of trust

Depegging events can erode confidence in the entire stablecoin market and the specific project.

Regulatory scrutiny

Such events often lead to increased regulatory attention on stablecoins and the broader crypto industry.

Disruption of crypto ecosystems

Many DeFi protocols rely on stablecoins; a depeg can disrupt these systems. And as stablecoins are often used as collateral, depegging can trigger mass liquidations and potential system-wide instability.

Project failure

In extreme cases, like with Terra/LUNA, a stablecoin depeg can lead to the complete collapse of the associated project and ecosystem.

Understanding the mechanisms behind stablecoins and the risks of depegging is crucial for anyone involved in the cryptocurrency space. While stablecoins play a vital role in the crypto ecosystem, providing a bridge between traditional finance and the volatile world of digital assets, they are not without risks. Be sure to always do your own research before engaging in the crypto space.

‍

‍

Understanding what crypto trading pairs are is important for all levels of trading, whether new to the market and looking to buy cryptocurrencies or wanting to engage in advanced arbitrage strategies. 

While the concept has been around in the stock markets for a while, it came about in the crypto industry due to a number of exchanges only allowing bigger cryptocurrencies like Bitcoin and Ethereum to be purchased with fiat currencies. While other cryptocurrencies were available on the platform, they could only be bought by trading BTC or ETH. Hence, it became necessary for a relationship to be established in terms of value between the cryptocurrencies being exchanged for one another.

When it comes to investing in cryptocurrencies there are plenty of options available, it only makes sense that markets open allowing one digital asset to be traded for another.

Crypto Trading Pairs Explained

Every cryptocurrency has an established value against a fiat currency, while this will continuously change depending on the market conditions affecting it, the use of the same fiat will remain. Most sites default to present a cryptocurrency's value in USD, however, they also allow for changes to be made (to GBP, EUR, etc). This is referred to as a base currency.

A trading pair is when two cryptocurrencies can be traded against each other, as opposed to a cryptocurrency and fiat. For example, BTC/LTC, or ETH/DOGE. In order to acquire the one, the other will need to be exchanged. In this case, the base currency is now a cryptocurrency. 

If you would like to buy DOGE with DOT but the exchange does not have this trading pair available, you would need to exchange DOGE for BTC, and then buy DOT with the BTC. Unfortunately, this will incur more fees, illustrating the convenience of trading pairs. 

How Do Trading Pairs Work?

Exchanges typically allow you to compare costs between cryptocurrencies, i.e. how much Bitcoin you will need to pay for Litecoin. If you are unable to load your account with fiat, you can still trade using cryptocurrencies, depositing one and trading it for another. 

Trading pairs allow you to establish a cryptocurrency's value in terms of another cryptocurrency. 

Say you buy ETH/LTC, this means that you are buying ETH in exchange for LTC. LTC is then the base currency. If you were selling ETH/LTC, you would be selling ETH and accumulating LTC. Ethereum and Bitcoin are the most common base currencies, however, the bigger the exchange the more trading pairs are on offer. 

Before engaging in any trading pairs take a look at the fees and taxes associated with the trade on the exchange's website, as sometimes some cryptocurrencies can incur higher fees. 

In Conclusion

Trading pairs are when a cryptocurrency is valued against another cryptocurrency and capable of being traded for one another. Trading pairs provide an essential role in the crypto economy. These days there are hundreds of trading pairs on offer, allowing traders to make informed decisions, find better prices, and perform a greater number of transactions. 

‍

You might have come across the term p.a. in traditional investment cycles, but how does it relate to crypto? In this article, we’re breaking down what p.a. means, how to get in on it and how it relates to the crypto industry. 

What does P.A. mean?

P.a. is an investment term that stands for per annum. This refers to the interest an investor can gain over a year's period and provides insight into the yields that the investment will generate. This is calculated on a simple basis and not compound. 

You might see digital wallet platforms offering reward rates of 8% p.a. Or 14% p.a., this tells the potential investor that the platform will provide 8% of the initial investment, over a 12 month period. 

PA can also stand for price action, a popular term used on crypto Twitter. In this piece we're focusing on the annual interest rates version.

How can users make money with crypto assets?

There are several ways in with industry participants can earn cryptocurrency. Below we outline the most widely used, and safest options. Be sure to check each option with the relevant blockchain network as these will differ from network to network.

Crypto Mining

Crypto mining can be a lucrative means of generating a passive income, however, the costs might run high depending on where you live and what cryptocurrency you are mining. Each network has its own way of minting new coins, which require different hardware and electricity means. 

Bitcoin, for instance, is a Proof of Work network that requires miners to use large amounts of energy as they race to finish a complex cryptographic puzzle. The first to complete this is rewarded with mining the next block and receiving the associated payoffs. 

Bitcoin requires a large amount of electricity, not practical in areas with high electricity costs, and either a graphics processing unit (GPU) or an application-specific integrated circuit (ASIC), which can also be costly. 

If you wish to get involved with mining cryptocrrencies be sure to do adequate research on what will be required and what income this could generate before investing any money. 

Crypto Staking

Crypto staking is an alternative minting solution for Proof of Stake networks, such as Cardano and soon-to-be Ethereum. Crypto staking requires users putting their funds in a smart contract usually for a predetermined lock up period to confirm transactions on the network. This will typically require a minimum amount, so as to ensure that individuals hold a “stake” in the network and will act on good intentions. 

When crypto traders stake the minimum balance, a node will deposit these funds into a staking pool on the network, similar to a deposit. The bigger the stake, the higher the chances of that user, now referred to as a node, being chosen to verify transactions. When the node is chosen to confirm transactions, they will create a new block and receive a reward for adding it to the blockchain.

Reward rates are specific to each blockchain network so be sure to check the details relevant to platform on which you wish to stake. As a security mechanism, the staked coin in the network is typically taken away if the node acts with ill intent.

Passive Income

There are a number of crypto initiatives that allow users to earn passive income through their crypto assets. These work in a similar way to holding funds in a wallet, however, these wallets will likely be on a cryptocurrency exchange or DeFi wallet and the user will typically not be able to access the funds for a certain period of time. 

Over the duration the user will earn interest as stipulated in the initial agreement. Note that p.a. Values are subject to change with market fluctuations, rising when prices rise and falling when an asset’s price takes a dip. This typically works in the same way as a savings account.

Its worth noting that the onus lies on the traders to pay taxes on any income generated. It is important to check the crypto specific tax laws in your region.

Disclaimer: This article is intended for communication purposes only, you should not consider any such information, opinions, or other material as financial advice.

Investing is not as easy as the internet makes it seem, with every profit comes plenty of research behind it. Not to mention all the strategies. Similar to trading, investing can at times be time-consuming and demanding. While investing, whether in the stock market or cryptocurrencies or any other asset classes, is beneficial in so many aspects, it can also come with some trial and error. In this article, we take a look at the time-tested dollar-cost averaging and explain why this is considered to be a low-risk strategy.

What is DCA?

DCA is an abbreviation for dollar-cost averaging. You may be wondering what DCA is? To put it simply, DCA is an investment strategy that sees people investing gradually over time rather than dropping a lump sum of money into assets.

Let's say an investor has a total of $10,000 to invest monthly, lump-sum investing would see them entering all that money into an asset market while DCA would have them investing $500 each week or month. Not only does DCA provide your leeway to pay your bills while still investing, but it also protects you from excess loss. While lump-sum investing does have its perks, it also has the potential for big losses.

By investing only what you are willing to lose, you are at no risk of financially crippling yourself. DCA ensures you do not lose all your money on an investment, whereas one wrong trade in lump sum trading can greatly set you back. DCA is a great way for newbies to test the markets and trust in an investment before moving forward, seasoned traders are also a fan of DCA as it allows them to diversify their funds in a more structured way. 

The point of DCA is to avoid market watching and big losses, DCA is the practice of routinely investing smaller amounts, timed over regular intervals, regardless of price. This typically allows the investor to buy an asset at an average cost of a long period of time.

Why and how to use DCA

The how is easily answered, as already stated prior, it is as simple as allocating a set amount aside each month with the plan to invest. You invest your set amount a month routinely, regardless of the price, growing your total shares. But the real question is why? Why is this strategy so popular and why is it so highly recommended? Let's get into it. 

The benefits right from the get-go are clear, you hold less risk of losing everything at once. As the traders' tale goes, only put in what you are willing to lose. Lump-sum investments do not take this approach with caution, putting it all on the line, or a large portion at least.

DCA means that you are continuously putting in small amounts that do not greatly limit your day-to-day life while still growing the value of your portfolio. DCA is a longer-term investment strategy. It also eliminates some of the risks involved with investing.

With DCA, the markets don't matter, you are buying your assets at whatever price they are at and reaping the profits when the price climbs. But also, by purchasing every week rather than all at once, you have the option and ability to buy in on the volatile markets getting better prices per share than someone who puts it all in at once.

This strategy also helps you manage emotional investing, forcing you to hold onto your investment despite FUD being spread, ensuring you don't sell low or buy high.

The DCA conclusion

While there are many investment strategies out there, this is a favoured strategy by many investors, that is not to say it is the only or best strategy, just one to consider. There are many perks that come with DCA, and that's what we wanted to highlight in this piece for you today. DCA provides a sense of commitment that is hard to find, ensuring you secure your space in the market without any added risks. There will always be risks involved with investing, but the DCA strategy finds some ways to minimise those risks in comparison.