The crypto community lacks a set of commandments and does not enforce a system of rigid regulations. On the other hand, investors frequently preach that everyone should thrive by relying on personal research.
Beginners of any subject would, in an ideal world, have access to a universal handbook that explains how a sector operates and how to participate in it. However, because we do not live in an ideal society, people are strongly encouraged to conduct their own research (DYOR).
DYOR is a concept that has never gone out of style. It can be used in every aspect of life. However, there is no other option than to DYOR when it comes to a disruptive and highly innovative sector like blockchain.
What is DYOR?
Do Your Own Research (DYOR) is a potent acronym that encourages newcomers to learn on their own rather than always relying on others. The community is pushing DYOR to protect new investors looking for solid investments and is being shilled by other investors looking to pump their bags.
Failure to DYOR in Practice
Let’s imagine a new investor named Remi decides to enter the cryptocurrency market by creating a Binance account and funding it. He’s heard of Bitcoin, Ethereum, Cardano, and all the other fancy names, but he’s more interested in benefitting from altcoins that aren’t as well-known.
Rather than researching, he begins his search for a good asset by searching. What exactly does this imply? Remi goes to Bitcointalk, a cryptocurrency subreddit or Crypto Twitter chats, to see which coins are now trending. Along the way, he comes across users who promote their assets to others in order to boost their portfolios. Alternatively, those users could be members of a project’s marketing staff who promote the initiative to raise exposure.
You are more prone to be misled if you rely on the word of others. Sure, someone may be able to assist you by providing his in-depth knowledge of a highly bullish altcoin, but this is not always the case. Instead, Remi will buy someone’s bags and end up with a project that isn’t even being actively developed in the worst-case scenario.
How to DYOR
Remi’s crypto journey ended with him purchasing a digital asset based on the advice of others rather than coming to his own conclusions. He might have struck gold if he was lucky, but as we all know, it is a rare event in the sometimes predatory world of finance.
After all, cryptocurrency is all about generating money, so it’s no wonder that some investors are taking advantage of others. What is the solution? DYOR.
Learn How to Learn
Many people do not know how to learn correctly, which may come as a surprise. They memorize irrelevant information, never test a procedure or experiment, fail to explore beyond surface-level knowledge, and, in general, never grasp a subject’s essential significance.
In that instance, knowing how to learn is significantly more crucial than knowing what a blockchain is or what type of data crypto transactions contain.
Return to the fundamentals. Make a plan for getting around in the decentralized world and stick to it. Don’t waste your time reading caustic Twitter threads full of half-truths; instead, concentrate on the basics.
Identify Potential Investments
A substantial portion of DYOR is spent determining whether projects are ready to invest in. After all, debating the best block size only gets you so far. Participating in the cryptocurrency market is primarily for the goal of investing in assets rather than for the purpose of discussing them. That is why you must get comfortable in your chair and devote numerous hours to project study.
Create a small list of projects that you are interested in first and foremost. After that, examine each project’s website, team, smart contracts, marketing approach, and so forth. Do everything that one would do when conducting fundamental analysis in practice.
Technical Analysis (TA)
Market analysis is crucial for a day trader. To excel with technical analysis, you must spend time staring at charts, looking for candle patterns, evaluating indicators, and testing new trading techniques.
Naturally, DYOR plays a role in this as well. There is always a day when you can learn something new or improve your trading skills solely by practicing.
Fundamental Analysis (FA)
Last but not least, fundamental analysis is used to welcome investors to DYOR. FA is a market-based evaluation approach for determining the fair value of an item. This is typically accomplished by looking into company practices, whitepapers, roadmaps, development, marketing plans, teams, tokenomics, network activities, and so on.
In other circumstances, FA also entails keeping track of market data, including volume, circulating supply, token emissions, team token distributions, and so on.
With the use of fundamental analysis, users may determine if a project is undervalued or overvalued and how it compares to other initiatives. Investors can only rely on DYOR because the procedure is so lengthy and involves so much investigation.