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Rachel Welch

23 November 2022 17 Read Crypto

What is Fundamental Analysis in Crypto?

Using the right indicators to figure out the true value of crypto assets can be a daunting task. Fortunately, there are several educational sources to help newcomers figure out a good strategy.

One of the simplest indicators is the number of unique addresses used within a given period. Another indicator is the total number of sending and receiving addresses within the network. This is often considered a sign of a well-functioning network. Using a protocol's native unit is another method for measuring transaction values.

The crypto industry is awash in indicators, ranging from social media to user behavior. However, these aren't the only factors to consider. Using a variety of indicators to gauge the value of a crypto asset can help an investor determine whether or not the asset is worth the hype.

Similarly, the crypto industry is not the only one to feature a few quacks in the space. This is why doing your due diligence is important before committing to an investment plan. Using the best metrics can help minimize the risk of an investment. This is especially true in the volatile crypto market. In addition, having a good grasp of the market will make you a better trader.

One of the most important metrics to gauge is the hash rate, a function of the computational power of a network. This statistic is calculated from publicly available data. A higher hash rate indicates that the network is healthy. A lower one indicates that miners may be capitulating.