Blockchain technology has given rise to cryptocurrency and redefined the way we look at digital finance. Over the years, cryptocurrency has become increasingly popular as an investment choice and there are more people looking to break into crypto. With that being said, there are hundreds, if not thousands of projects available in the market, and some people might find it challenging to pick the ones they would like to support.
However, it does not necessarily have to be as challenging as one might think. As we peel back the layers of each crypto project, we may find that there are key features to consider when deciding if a project is worth supporting. In anticipation of the new year ahead, here are some key features one can look out for before investing in the next crypto project.
The 3 features to consider are the project’s applicability, team, and community. Understanding these features can help identify legitimate opportunities, understand the technology more, avoid the bad actors and of course, continue the fight against crypto scares.
Feature 1: Applicability – Knowing the “what” and the “why”
The first layer behind every crypto project is the applicability, which can be simply understood as the purpose and usage behind a project. Cryptocurrency tokens usually allow holders to spend or transfer value on the blockchain while ensuring that these transactions are secure and reliable. With that being said, there are many variations of cryptocurrencies, each one having different functionalities. On top of that, crypto tokens and blockchain projects can offer other services and features to their users.
Just to name a few, there are security tokens, utility tokens, payment tokens, exchange tokens and so on. Binance, the world’s largest blockchain ecosystem, uses BNB, a utility token that is native to the exchange. Not only does the BNB token provide seamless transfers and transactions, it also provides other special utilities such as discounts on fees as well as participation rights within the Binance community.
Understanding the applicability of each project is not only crucial in determining if the project aligns with one’s values and foresights, it also helps in assessing if the project is meant to last or if something fishy is already going on from the get-go. These details are included in the project or crypto token’s whitepaper – a document that contains details of the creator’s vision for the token as well as features that it will provide to users and more.
Feature 2: Community – Knowing the people around the crypto project
A crucial feature of a crypto project is the community that is supporting it, which users often overlook before diving straight into investing. Communities are fellow users that support and utilize a token and are essential to the success of blockchain projects. A strong community is not only defined by the big influencers that push and market a project, but also by the individuals that help support its growth by being actively involved.
A good crypto and blockchain project will have an active community that is constantly talking and interacting, not just with each other but also with the people behind the project. Blockchain’s decentralized nature allows community participation by voting on changes and updates or making suggestions through the form of proposals. For example, Ethereum or ETH, one of the most popular blockchain tokens in the world, has the Ethereum Improvement Proposal program that allows ETH users to suggest updates, not just on the token’s utility but also other core functionalities, and network improvement.
Blockchain projects with a high level of inclusion will allow users to be more involved. Apart from providing opportunities to learn more about the project, it also allows users to share ideas or refine features and utilities that a project already has. After all, supporting more great projects can help push the technology forward and unlock new innovations.
Feature 3: The team – Meeting the people behind the crypto project
The third facet of a crypto project, as well as one of the most important aspects to take note of is the team and people behind the project. In blockchain, the team consists of people responsible for designing, coding, and maintaining the project. This also includes business professionals who provide support and facilitate communications with the token’s community. In addition to having a great track record in the community, a strong project should also have a team that is experienced in the development and creation of related blockchain and cryptocurrency projects.
Transparency is one of the core features of blockchain and that should also be extended to the team members of a crypto project. Being transparent also includes being involved and active in the community; users should be aware of who the team members are and be kept up to date with what they are doing.
Binance’s Changpeng “CZ” Zhao, who is one of the global leaders in the crypto space, always makes sure to maintain regular and active communications with users through his social media channels and media appearances. This way, users are always kept up to date on happenings within the ecosystem and remain constantly engaged with the core team behind the crypto projects.
Getting into Crypto
Closing the knowledge gap is essential when it comes to crypto. To ensure the sustainability of the crypto and web3 ecosystem, Binance has several features in place to help users trade responsibly and make informed trading decisions. For one, Binance provides free educational materials to users through Binance Academy, which is an open access blockchain and crypto learning portal that hosts free educational resources in over 20 languages. In November 2022, Binance Academy launched their first free crypto education courses and has since accumulated 200,000 users who have completed up to 8.3 years of blockchain course content (at an average of 22 minutes per user). To learn more about crypto projects, visit https://academy.binance.com/en.