1. Major funds' bottom line: Is the capital really 'working'?
I've seen too many people staying up all night staring at K-line charts, ecstatic when the price rises a bit, and devastated when it falls slightly, yet they have never asked a crucial question: Who is footing the bill for this wave of market activity?
The new project especially loves to create illusions, talking about 'Wanchain Interconnection' and 'Ecological Revolution', but if you find its price curve jumping up and down like an electrocardiogram while the trading volume remains as calm as dead water—don't doubt it, this is just retail investors getting high on themselves. Truly promising projects always see major funds quietly entering the village, without making a fuss.
How to judge? Look at two points:
How long is the quiet period: If a coin is in a low position for more than half a year, does not follow the market when it rises, does not break the bottom when the market falls, and every drop sees trading volume shrink to a minimum while the rise is gently supported by increased volume, it indicates that the chips have been patiently collected. Coins that rise by 200% in three days and flood the internet are, in fact, smokescreens for the main players preparing to sell.
Who is picking up the chips: Use on-chain tools (like Nansen or Glassnode) to check the holdings changes of the top 10 addresses. If whale addresses continue to accumulate during a downturn while retail addresses chase the highs, then the show can go on.
A pit I fell into in 2021: A certain 'metaverse rising star' increased by 5 times in a week after launch, the community was full of 'vision' and 'faith', but the on-chain data showed that the project party's address was frantically transferring funds to exchanges. Later, the price was halved again and again, and those who shouted faith even canceled their accounts.
2. Consensus Gravity: Is the community 'truly lively'?
There is a paradox in the crypto space: no matter how strong the technology of a project is, if no one discusses it, it will eventually go to zero; conversely, those with mediocre technology but a crazed community (like Dogecoin) can survive the bull and bear cycles. Community engagement is not about Twitter follower count but about 'how many people are willing to argue for you'.
The difference between a true community and fake liveliness:
Discussion Quality: In a true community, people will debate technical routes and governance voting plans, even spontaneously create memes and jokes; in a fake lively group, there are only 'when will the price pump' and 'teacher, guide me'.
Downward resistance: Last year, a DeFi project faced a short attack, the price fell by 30%, but instantly hundreds of messages surged in Discord, with some organizing counter data, and others arranging AMA clarifications. A week later, the price not only recovered but also reached a new high. This kind of cohesion is much more substantial than the 'disruptive innovation' in the white paper.
3. My Screening Framework: Conduct a 'health check' on projects.
Now when encountering any new coin, I will check four reports like a health check:
Funding Report: Has the sideways period exceeded 3 months? Is there volume support during the rise?
Community Report: Is the daily active user count on Discord/Telegram stable? How frequent is the interaction with the project team?
On-chain report: Is the contract open source? Is the LP pool locked? Are the actions of the whales transparent?
Risk Report: Is there a promise of guaranteed returns? Is there an emphasis on 'referral bonuses'? (If encountered, directly block)
The crypto space is full of stories of 'getting rich overnight', but those who have truly survived three cycles of bull and bear markets understand one principle: high returns always come with high risks, and controlling risk is the greatest skill. Don't envy those who make quick money by luck; they are likely to lose it back due to lack of skill.
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