It’s hard to overestimate the significance of crypto news to traders, investors, and other cryptocurrency community members. Cryptocurrency news makes it possible to study any project not by the dubious quality of informational materials, but by reconstructing the direct chronicle of the main events invariably included in headlines and bulletins.
Cryptocurrency fundamental analysis precisely implies a deep dive into the available information about a crypto project and its token. But why do it? Well, to identify patterns and make predictions.
Cryptocurrency Fundamental Analysis and Forecasting
The main function of fundamental analysis is to determine the “real” value of an asset. It helps to correlate the current indicators with the expected ones, estimate the influence factors and make forecasts.
Fundamental analysis has three basic directions:
- Project metrics. This includes analyzing crypto news and all sorts of materials on the project. The goal is to study the project’s whitepaper and roadmap, its products, and tokenomics. It’s necessary to find out all the details about the project team, that is, who is behind its creation, development, and financing. Finding and at least superficially analyzing the project’s main competitors is crucial in order to assess its place in the market. Crypto news, thematic articles, and other informational materials allow collecting this data from the most diverse and independent sources.
- On-chain metrics. These are the project’s technical quantitative characteristics. Transaction volumes, the number of active addresses, commission amounts, processing power, and network bandwidth. All these data in blockchain projects are usually open and available directly from the project or specialized services.
- Financial metrics. These metrics include market capitalization, liquidity and trading volume, issuance patterns, inflation rates, and other financial mechanisms and indicators. You can find these data in specialized services, as well as in the project documentation, which brings us back to the first point.
There are no academic methods of fundamental analysis, so all interested individuals develop and use their own analysis algorithms based on the existing data and personal experience. The primary indicator of the success of a particular method is its results. If the method allows building the forecast with the subsequent realization of 70% and higher, it’s a good one.
How Does Crypto News Help in Fundamental Analysis?
All public and relevant information about the cryptocurrency project is glimpsed in a constant media flow:
- changes in quotes;
- investment receipt;
- new product launches;
- major contracts and partnerships;
- changes in the management structure, etc.
Everything appears in crypto news: companies’ achievements, successes, and failures. Undoubtedly, this affects their tokens’ value because we’re talking about cryptocurrency companies. There are also analytical articles, expert opinions, and reviews among the news reports. Analyzing the influence of news events on asset quotes in the past and comparing them to similar correlations in the present helps to identify patterns and make future predictions. It’s essential to remember that such forecasts need to consider the totality of factors that influence the cryptocurrency price at a given moment, including the market’s general mood, a particular market segment, and macroeconomic and other factors.
Therefore, when taken in an integrated approach, fundamental analysis helps crypto investors and traders assess the prospects of various assets and build their strategy based on the analysis data. Cryptocurrency news is one of the key sources of information in this analysis.
Press releases or guest posts published by Crypto Economy have sent by companies or their representatives. Crypto Economy is not part of any of these agencies, projects or platforms. At Crypto Economy we do not give investment advice and encourage our readers to do their own research.