In this step, we discuss fundamental analysis (also known as “fundamental analysis”) of Bitcoin and cryptocurrencies. In the previous section (Step 3 and Step 4), I answered the question of why we should invest in the cryptocurrency market and blockchain careers. If you still have a question on your mind, be sure to ask me through the comments section at the bottom of this page or by email, so I can give you the right answer and you can continue the next steps with greater awareness alongside me.

In Step 5 to Step 7, we answer the first of the essential questions in building a trading and investment strategy:

Which cryptocurrency should we buy?

To answer this very important question, we must develop the ability to recognize the characteristics of each cryptocurrency, so we can categorize different cryptocurrencies, compare them, and ultimately choose one or more suitable cryptocurrencies for investment based on our own risk tolerance.

“Fundamental” means basic or foundational. In general, when we want to buy an asset like real estate or a car, we either rely on personal knowledge and experience or consult a specialist. First, the authenticity, documents, and health/condition of that property or car are verified, and then we proceed with the purchase. In other words, we analyze it deeply and essentially (fundamentally) and do a detailed examination.

In the crypto market, too, in order to choose a suitable cryptocurrency for investment, we must properly review the technologies inside that crypto asset, identify and analyze the founding and development team, and understand its base, foundation, and underlying structure—so we can buy and invest with the lowest possible risk.

Fundamental analysis is the first step in designing and setting up a successful trading and investment plan. That plan is the strategy. A strategy tells us what we should NOT do and what we should do. In 21 Steps, you will learn what strategy and plan to write for yourself so you don’t get confused in financial markets—especially the cryptocurrency market. The points you learn across these 21 Steps will ultimately give you the ability to answer the essential questions of building a trading and investment strategy:

  • Which cryptocurrency should we buy?
  • When should we buy cryptocurrency?
  • How much cryptocurrency should we buy?
  • When should we sell cryptocurrency?

Like any other profession, doing fundamental analysis on cryptocurrencies is also a highly specialized task. You can master it yourself, or you can seek help from a specialist in this field. Even if you decide to consult a specialist, it is much more useful if you also know the basics, so you can speak a common language and move forward with more constructive interaction during the consultation.

Fundamental Analysis of Bitcoin

I’m sure you have already done Bitcoin’s fundamental analysis before. You might ask: when and where? Go back to Step 1 through Step 4. Yes—that’s right. Most of the fundamental analysis for a crypto asset is the set of checks you learned in previous steps, plus a few additional points that I teach you in this step:

  • Review the underlying technology of the cryptocurrency (reviewing the blockchain features of the crypto asset) (Step 1)
  • The founding / developer team, group, or company behind the cryptocurrency
  • Companies or individuals investing in the project team
  • The problem the cryptocurrency wants to solve
  • The level of creativity and innovation in the proposed solution
  • The advantages of the cryptocurrency versus similar competitors
  • The progress level of the crypto or blockchain project
  • The level of public interest in the crypto or blockchain project
  • Acceptance / listing on reputable exchanges
  • Acceptance among experts and the public
  • If the cryptocurrency is older: reviewing its past performance in profitability (Step 4)
  • Forecasting the future of the cryptocurrency by analyzing current and potential competitors
  • The project statement or whitepaper (White Paper)
  • The roadmap provided by the team (Roadmap)
  • The extent and quality of delivering the promises stated in the roadmap
  • Community growth (Community Growth)
  • Token economics / tokenomics (Tokenomics) (Step 6)
  • Supply and demand: the token’s supply and existing/potential demand (Step 7)

Based on the list above, we first do the fundamental analysis of Bitcoin as a cryptocurrency (so we assume we know nothing about Bitcoin and have only heard its name).

Fundamental Analysis of Bitcoin’s Underlying Technology

With a bit of internet searching or ChatGPT searching, we realize that Bitcoin’s underlying technology is blockchain. I personally search Google or any AI answering engines (ChatGPT, Gemini, Grok, Copilot,…) like this:

“the technology behind Bitcoin”

“What is blockchain technology”

Usually, the articles and information you find in English include more up-to-date, documented, and accurate details. Because sometimes I’ve seen that in Persian content, some translations fail to convey the original author’s meaning well, and in other Persian texts I’ve seen a specific word or sentence translated completely incorrectly! Unfortunately, there are websites that copy these errors without review and editing.

Blindly following articles on websites or social media posts without research (even those with a lot of followers) will cause financial loss—and consequently emotional and psychological harm.

Believe it!

So “always” do your own verification and fact-checking of what you see, hear, and study. — Mahdi Beik Mohammadloo

On this website, I have tried—based on 22 years of experience across multiple fields including information technology, crypto markets, foreign trade, marketing, iOS and Android software development, designing and managing e-commerce stores, and inventing various hardware products—to use all my knowledge and experience to provide valuable Persian content that is technical, practical, documented, and usable for those interested in entering or investing in crypto markets, so you can move independently in this specialized, fascinating, and practical market while not allowing opportunists to endanger your capital or mislead you.

Naturally, after we realize Bitcoin was born backed by blockchain, we go research blockchain. In Step 1, you already gained good information about blockchain, and now the path for deeper research into this technology is open and smoother for you.

Fundamental Analysis of the Team / Group / Company Behind Bitcoin

By searching the internet, we learn that an unknown person or group named “Satoshi Nakamoto” is the creator of blockchain and Bitcoin. I personally search Google like this:

“who made Bitcoin” or “who developed Bitcoin” or “Bitcoin project team” or “Bitcoin developers team”

You can also search in Persian:

“Who invented Bitcoin” / “Bitcoin creator” / “bitcoin project team” / “Bitcoin development team”

When well-known and reputable people develop and promote a crypto project, it increases the credibility of that project. But why—despite the creator/team being unknown—has Bitcoin received such attention over the years?

There is a subtle answer related to blockchain’s characteristics. As I mentioned in Step 1, many volunteers around the world maintain the blockchain and confirm transactions—some voluntarily and others for rewards. This global network of computers is not easily shut down or hacked. In an email Satoshi Nakamoto sent to a group of programmers and cryptography specialists, these features were described. From that point on, many people in technology trusted blockchain without knowing the inventor’s identity, relying only on those creative features and using them. So here, trust in a specific person is not the point; trust forms through trust in the technology and testing it over time.

Today, we use the internet and the web widely without knowing who created them, because specialists tested and verified these technologies years ago, and now we use them without knowing which people or which complex technology sits behind them.

As I said, not needing to trust a specific authority is a built-in feature of blockchain. Early adopters studied the definitions and features published by Satoshi, tested them successfully, and did not need to know or trust a specific person. Perhaps there is a hidden point in Satoshi staying anonymous:

In a decentralized system that “by nature” does not require identifying or trusting a specific authority, what is the need to know its creator? Maybe Bitcoin’s creator remained anonymous from the beginning to prove exactly this point. — Mahdi Baikmohammadlou

This anonymity itself is proof of blockchain’s “trustless” nature. If you want to study more, search for:

“What is a Trustless system” 

We don’t need to know who Satoshi Nakamoto was; what matters is reviewing what was said. — Mahdi Baikmohammadlou

Why Do Crypto Project Teams Seek an Audience?

Today, cryptocurrencies are not just a new financial tool replacing money and currency. In recent years, new cryptocurrencies have effectively functioned like shares for their project teams. Just as companies like Apple and Tesla raise investors by offering shares in the stock market, crypto and blockchain projects introduce their “shares” in the form of a cryptocurrency—sometimes even before full development, at the project’s birth—so that through ongoing issuance over time or an initial offering of part of the supply, and through investors buying those tokens, they can raise capital to build or further develop their blockchain, service, or product.

These products or services are often software products such as a decentralized exchange, an online gaming platform, a metaverse, and so on. But in my opinion:

In the near future, we will also see cryptocurrencies designed to support physical production such as cars, food products, and more. — Mahdi Baikmohammadlou

In other words, crypto and blockchain projects are startups that, instead of going to venture capital (VC), rely on global crowd funding through people worldwide. This can be a major warning signal for VC firms to quickly revise and update their investment strategies. In my view, in the near future, decentralized capital markets (DeCap) will replace many forms of traditional fundraising.

Fundamental Analysis of Investors Supporting the Bitcoin Project Team

It is still unknown how much time and cost was spent developing, testing, and launching blockchain experimentally before Satoshi’s first email. But the owner(s) of the Bitcoin.org domain (which also has a Persian version), the software maintainers in GitHub, the Bitcoin data custodians (Bitcoin nodes), and the transaction validators (miners) who receive rewards are all considered today’s financial, technical, and moral supporters of Bitcoin.

Problems Bitcoin and Blockchain Solve

In Step 1 to Step 3, we learned what this internet money and its technology solve.

Creativity and Innovation of Blockchain and Bitcoin

We also learned about this in Step 1 to Step 3, especially Step 3.

Bitcoin’s Progress and Public Interest

With a bit of research, we find that Bitcoin and blockchain have existed for years (since 2008) and have grown from an early project into a well-known internet currency and a widely used, practical technology.

Acceptance / Listing of Bitcoin on Reputable Exchanges

Bitstamp is one of the oldest exchanges that enabled buying and selling Bitcoin for dollars. Over time, other exchanges were created for this purpose, and today one of the largest is Binance, and at the time of writing this step, Bitcoin trading is happening there with high volume.

Past Performance of Bitcoin in Profitability

In Step 4, we saw that over the past ten years Bitcoin has delivered higher returns to its long-term investors compared to many common assets in financial markets—including many other cryptocurrencies.

The Future of Bitcoin and Its Current / Potential Competitors

As we saw in Step 3, blockchain and Bitcoin have not only passed real-world tests successfully for years, but also have a brighter long-term future ahead. But from the beginning, after blockchain technology was introduced, teams of programmers, marketers, and investors studied Satoshi’s specifications and developed new blockchains, each claiming improvements or fixes over Bitcoin’s blockchain to attract users. This continues today and certainly will not stop. Today we have hundreds of blockchains, each with its own cryptocurrency.

In Bitcoin’s fundamental analysis, we realize that many early competitors tried to address weaknesses identified in Bitcoin’s blockchain. One weakness was throughput: Bitcoin could confirm roughly about 9 transactions per second. Another weakness was scalability—meaning if many users worldwide simultaneously submit transactions, Bitcoin can process only a limited number; many transactions end up in a long queue (sometimes several days) or are simply canceled.

This issue led a group of programmers to implement an innovative idea on top of Bitcoin. Lightning is that idea. Lightning is not a blockchain; it is a tool that aggregates small transactions waiting for confirmation, helping transactions confirm faster and preventing long queues. In practice, it improves the scalability of Bitcoin’s blockchain.

Litecoin (LTC) was among the earliest competitors of Bitcoin’s blockchain, claiming that transaction speed was higher than Bitcoin. After specialists and then the public used it, this claim proved true, and Litecoin attracted different audiences for a long time. You can check Litecoin’s price growth here:

Price Changes in Fundamental Analysis

As you can see, Litecoin’s price in its early days (August 2016) was very low (around $3.7). After it attracted attention, it rose as high as about $227 in December 2017. Of course, as you study older cryptocurrencies, you’ll see that Bitcoin and many popular cryptocurrencies experienced major price increases in that period as well. Much of that rise was due to positive market sentiment at the time (and in later cycles). In those special conditions, cryptocurrencies competed on growth speed and how much their price rose relative to others.

Another older cryptocurrency with a different claim was Ripple (XRP). With a bit of research and fundamental analysis on Ripple, we understand that it is essentially a network that enables international transactions between banks and institutions at a speed much higher than the current system (SWIFT), without its limitations and formalities, and with fees lower than Bitcoin.

Over the years since blockchain was born, other new blockchains have appeared competing with Bitcoin, but:

Smart Contract

In my opinion, the most attractive and toughest competitor of Bitcoin is Ethereum, with the symbol Ether (ETH). Transaction speed on Ethereum is much higher and fees are much lower than Bitcoin’s blockchain. But Ethereum’s different and creative feature is that Ethereum not only has its own blockchain like Bitcoin, but it also enables people, companies, software, and even mobile and computer games to create their own cryptocurrency on Ethereum’s blockchain. That means in addition to transferring ETH on Ethereum, other cryptocurrencies can also be designed, created, and transferred on Ethereum.

How Did Ethereum Enable Smart Contracts?

Through Ethereum’s fundamental analysis, we learn that by designing and developing a simple programming language called Solidity, Ethereum enables people to program a cryptocurrency with their own preferred name and symbol quickly and easily (within minutes, assuming basic familiarity with Solidity). These programmed codes are called smart contracts. Because in these codes/contracts, a person can set conditions (like a contract) for executing a transaction, validating it, how fees are paid by users, and many other customizable rules—then those conditions are executed automatically (smartly) between the two parties of a transaction (sender and receiver). People who transfer such tokens are subject to the smart contract rules of that token.

Also remember: in the crypto market, cryptocurrencies created this way are called a “token.” A token is a type of cryptocurrency that does not have its own dedicated blockchain; it is created and hosted on an existing blockchain—like a guest of existing blockchains. In contrast, cryptocurrencies that have their own blockchain are called a “coin.” So Bitcoin (BTC), Litecoin (LTC), and Ethereum (ETH) are all coins.

Some well-known tokens created on Ethereum include:

  • Uniswap (UNI)
  • Shiba Inu (SHIB)
  • Decentraland (MANA)
  • Sandbox (SAND)

So be aware that anyone can create their own token. Unfortunately, today many people buy “some” tokens without paying attention to the token’s smart contract terms, and they can never sell—because the smart contract was programmed with a condition that prevents it! It’s true that most people cannot read code or fully understand how smart contracts work, but with some research and study about each token, you can understand how much risk investing in that token carries. You can also consult a specialist for guidance.

Interestingly, even with all Ethereum’s creativity, new competitors entered the market quickly—many of them, like Ethereum, can host tokens through smart contracts. One of the loudest and most famous is Solana (SOL), often called the “Ethereum killer.” I leave it to you to research Solana and its advantages versus Ethereum. But I won’t leave you alone—because here I have prepared material about Solana for you. Meanwhile, Solana has faced four full network outages in the past year, and the “Solana killer,” Aptos (APT), has arrived and made a lot of noise too. As you can see, competition in this field is very intense. People, projects, and companies can choose to build their tokens not on Ethereum but on a competing blockchain. Examples include:

  • Solana (known as the Ethereum killer)
  • Aptos (a newcomer known as the Solana killer)
  • Avalanche
  • Binance Smart Chain
  • Binance Beacon Chain

Now with all these competitors for Bitcoin—and with the revolution Ethereum created in crypto—where do you think Bitcoin’s place is?

Today Bitcoin is no longer only an internet financial tool for fast, intermediary-free transfers; it has become a store of value as well—like gold in the real world. Just as people buy and hold gold or silver to preserve the value of their money and capital, in the world of cryptocurrencies, individuals and large companies accumulate Bitcoin to preserve the value of their capital. I will teach the reason in Step 6.

Therefore, in my view, Bitcoin should be categorized in a different asset class—not only as a currency.

Fundamental Analysis of Bitcoin’s Whitepaper

Usually, all technical and economic features of a cryptocurrency—whether it is a coin or a token—are presented to the public in a file, a website, or at least a page on a website. Today, every project has a website to publish its project statement and the features of its cryptocurrency. In the crypto market, this statement is called the whitepaper.

There is still no formal standard for writing or publishing a whitepaper, but generally the following information can be found in most whitepapers:

  • Underlying technology of the cryptocurrency
  • The developer team / company / creator
  • The problem the cryptocurrency aims to solve
  • Creativity and innovation of the solution
  • Advantages versus similar competitors
  • Roadmap
  • Tokenomics

As you can see, answers to many important fundamental-analysis questions are in the whitepaper. So by studying the whitepaper carefully, you can speed up fundamental analysis. But also remember: no yogurt seller says their yogurt is sour. Whitepapers usually show big innovation claims and a picture of a successful future for the project and investors. But by going through 21 Steps, you can intelligently track those claims over the life of a token—from day one until now—and compare the original claims with what actually happened.

Be extremely careful with projects that are not launched yet or are only a few weeks old and try to convince you to buy their token using only an attractive whitepaper, a flashy website, and a team of smiling “experts” with impressive resumes. — Mahdi Beik Mohammadloo

One key reference website that helps us significantly in fundamental analysis is CoinMarketCap.com. On that website, we can find the official site address of cryptocurrencies and even the direct whitepaper link for each crypto. In the search field (magnifying glass), type the crypto name (for example, Bitcoin) and wait for a list to appear. Then click the crypto name to go to its page.

On each crypto’s page, you can usually find very useful information. In this step, we are looking for the official website link and the crypto’s whitepaper. Slightly below the name, symbol, and price, there is a row/section titled “Links.” Click the small arrow on the right to open a new panel with the links. Now you can click the website address (in this example: bitcoin.org) to go to the official site, or click “Whitepaper” to go to the crypto’s whitepaper file/page.

Note that the whitepaper link for some cryptocurrencies on CoinMarketCap may be outdated and may not take you to the actual whitepaper. In that case, you should first enter the project’s website and look for a link to view or download the whitepaper there.

For example, Bitcoin’s whitepaper is available in multiple languages including Persian on its official website Bitcoin.org via these links:

Roadmap in Bitcoin Fundamental Analysis

One very important item in fundamental analysis is the roadmap or the path a crypto project has taken—or wants to take—to reach its defined goals. The roadmap is usually accompanied by a timeline and milestones, often grouped in quarterly periods (Quarter): first quarter, second quarter, etc.

A cryptocurrency’s roadmap is usually found on its website or in its whitepaper.

Part of Bitcoin’s roadmap looked like this:

  • Whitepaper — Date: October 2008 — Satoshi Nakamoto published the Bitcoin whitepaper
  • Genesis Block — Date: January 2009 — Bitcoin’s genesis block was mined
  • Standard M-of-N Transactions — Date: October 2011 — BIP 011 implemented M-of-N signatures as a new standard transaction type, enabling secure wallets, escrow transactions, and other cases requiring more than one signature
  • Pay-to-Script-Hash — Date: January 2012 — BIP 016 (building on BIP 013) implemented a new standard transaction type for Bitcoin’s scripting system and defined additional validation rules applying only to new transactions. It shifted responsibility for providing redemption conditions from the sender to the redeemer and allowed complex redemption conditions to be represented by a fixed-length 20-byte hash that is short enough for QR codes and easy copy/paste
  • Hierarchical Deterministic Wallets — Date: February 2012 — BIP 032 introduced HD wallets (Hierarchical Deterministic Wallets), enabling multiple wallets and keypairs generated from a single recovery phrase, with flexible sharing and spending permissions
  • Limited Supply for Bitcoin — Date: March 2014 — BIP 042 introduced a limited supply after discovering a bug that could have allowed unlimited coin supply growth; developers added a “hard cap” for Bitcoin
  • OP_CHECKLOCKTIMEVERIFY — Date: September 2014 — BIP 065 introduced a new opcode allowing transaction outputs to be unspendable until a specified future time, paving the way for payment channels
  • CHECKSEQUENCEVERIFY — Date: August 2015 — BIP 112 introduced a new opcode which, in combination with BIP 68, allows script execution paths to be restricted based on the age of the spent output
  • SegWit (User-Activated Soft Fork) — Date: July 2017 — Proposed as BIP 148 by an anonymous developer (Shaolinfry) in response to “Segwit2x.” Users rejected Segwit2x and implemented a user-activated soft fork, showing that users control the Bitcoin network

Evaluating Delivery Quality and Roadmap Execution

One of the most important points in fundamental analysis is whether the promises and claims on a project’s website—especially its roadmap—have been delivered. And if delivered, whether they were delivered on time and with high quality and success, or whether the team only did small, ineffective tasks as a superficial show for investors.

Bitcoin’s roadmap has been fully delivered, and each underlying planned change has been tested in practice. Today, Bitcoin’s blockchain continues operating and developing with updated features compared to 2008, without technical problems. This shows that:

  • The technical team supporting Bitcoin’s software is active and monitoring the project
  • Bitcoin’s software is continuously updated
  • Bitcoin roadmap plans are being delivered
  • The execution quality of delivered plans is acceptable

Did you notice the “limited supply for Bitcoin” update in March 2014? A technical bug was found in Bitcoin’s code and immediately fixed. This is a simple example of active monitoring, debugging, and an active user/developer community.

In this whitepaper context, BIP means Bitcoin Improvement Proposals. If you want to read other BIPs, check the following link from Bitcoin’s official GitHub:

https://github.com/bitcoin/bips

Bitcoin Analysis from the Perspective of Community Growth

A cryptocurrency’s community includes the people, companies, or countries that:

  • support it (by following official pages, discussing it, and publishing about it online and offline)
  • use it
  • help develop its software
  • maintain and support its hardware/network infrastructure
  • earn income or create businesses directly or indirectly through it
  • trade it
  • hold it in their wallets (Holder / Hodler)

In general, a crypto community includes everyone connected to that crypto in any way. Without a doubt, Bitcoin has the largest community in the cryptocurrency market. It may not be easy to measure Bitcoin’s exact global penetration rate, but the fact that among more than 24,000 cryptocurrencies (the total number of coins and tokens listed on CoinMarketCap.com), the first crypto that comes to mind for people inside or outside the market is Bitcoin—this itself shows its adoption. Another useful measurement is the number of wallets holding Bitcoin, which can be a good scale for comparing Bitcoin’s community with other cryptos.

In fundamental analysis, the number of followers on official social pages can also be a metric to compare communities. However, some unknown or less-known projects may have fake or purchased followers, so you should be very alert. Social media addresses are usually listed on CoinMarketCap.com in the “Community” section.

It is also useful to know that most crypto projects are active on these social platforms (in priority order):

  • Twitter
  • Reddit
  • Discord
  • Instagram
  • Medium

Crypto development teams typically work in GitHub. For example, here are the GitHub pages for Bitcoin and Solana:

Also review Bitcoin’s Reddit (about 4.7 million members) and Solana’s Discord (about 135 thousand members) here:

On-Chain Analysis

In my opinion, the most important tool in fundamental analysis is research and study. But supportive tools like on-chain analysis can also help you examine the behavior and dynamics of a cryptocurrency. As the name suggests, on-chain analysis typically examines major transactions on a crypto’s blockchain, the distribution and balances across different wallets, and many other extractable signals from that blockchain. Websites like IntoTheBlock offer various free and paid datasets and services. I recommend you first study all 21 educational steps on this website, and after mastering them, then use on-chain analysis as well.

Reviewing the Portfolios of Large Companies

We cannot say with certainty that any cryptocurrency held in the portfolio of large investment companies is necessarily a future winner, because no one knows the future of these projects. Also, each company analyzes fundamentals based on its own strategy and policies, which may differ completely from our investment timeframe. For example, an investment company might have a 5-year long-term view, while we might prefer a one-year or even six-month horizon.

Still, because investment companies generally aim to satisfy their board and shareholders, they most likely do significant fundamental research before selecting a crypto. So we can partially rely on their analysis—especially if we see the same crypto in the portfolios of multiple different companies.

You can use all the fundamental analysis methods in this step when analyzing any cryptocurrency you want, and compare it with others to make a more informed decision in selecting a suitable crypto for investment.

In Step 6 and Step 7, we will examine tokenomics in more detail and the topic of supply and demand in a cryptocurrency.

2) Worth Noting

The original Step 5 framework is strong. The additions below make it more modern, more defensible, and more “investor-grade” when you analyze real projects:

  • Regulatory status and compliance readiness: A project’s long-term survival increasingly depends on whether it can operate under major regulatory regimes (token classification, licensing, disclosures, and exchange eligibility). This is now part of “fundamentals,” not an afterthought.
  • Security posture and audit discipline: Verify whether smart contracts and core infrastructure are audited by credible auditors, whether issues were fixed, and whether there is a public security practice (bug bounties, responsible disclosure, incident response).
  • Real adoption signals vs vanity metrics: Followers can be faked. Prefer metrics like active addresses, retention, fee revenue, protocol usage, stablecoin liquidity, and developer activity consistency.
  • Unit economics and sustainability: Ask: does the network or app generate sustainable value (fees, revenue, demand) or is it mainly subsidized by emissions (high inflation rewards)? This connects directly to Step 6 – Tokenomics.
  • Liquidity quality and market structure: Look beyond “listed on exchanges.” Evaluate the quality of liquidity (depth, spreads, real volume, concentration risk) and custody/settlement reliability—especially important for larger positions.
  • Governance risk: Many projects claim decentralization but have admin keys, upgrade controls, or validator concentration. This is a fundamental risk, similar to “management risk” in stocks.
  • Roadmap credibility and delivery culture: Beyond “did they ship,” evaluate how they ship: transparent reporting, realistic timelines, post-mortems, and measurable milestones.

3) Trending and Future Insights (Opportunities, Threats, Regulation, Adoption)

Major Adoption Trends

  • Tokenized real-world assets (RWA): Expect growth in tokenized funds, bonds, real estate claims, invoices, and commodities. Fundamental analysis will increasingly include legal enforceability, issuer credibility, and settlement guarantees.
  • Stablecoins as financial infrastructure: Stablecoins are becoming the “payment rails” for global trade and remittances; fundamentals will include reserve transparency, compliance, and redemption reliability.
  • Institutional-grade crypto markets: As institutions participate, standards rise: audited financials, robust governance, transparent token emissions, and regulated custody will become “minimum requirements.”
  • On-chain identity and compliance layers: Identity, credentials, and compliance tooling will expand—especially for RWA and regulated DeFi. Fundamentals will include privacy design, legal compatibility, and censorship-resistance tradeoffs.

Opportunities for Investors and Builders

  • Projects with measurable cash-flow or fee revenue: Protocols that generate real fees and have credible value-capture mechanisms can become the “blue chips” of the next era.
  • Security and auditing careers: Demand for security engineers and auditors will grow as code-based finance expands (ties to Step 3).
  • Cross-chain and interoperability leaders: Projects that reduce fragmentation (liquidity, messaging, settlement) may gain durable adoption—if security is strong.
  • Bitcoin scaling and settlement layers: As Lightning and other scaling approaches mature, Bitcoin fundamentals also increasingly include payments and settlement adoption (ties to Step 2 and Step 1).

Threats and Risk Trends

  • Regulatory fragmentation: Different rules across regions can split liquidity and increase compliance cost; projects may become “region-limited.”
  • Security incidents and systemic contagion: Bridges, smart contracts, and custodians can create systemic risk. A single failure can trigger broad market drawdowns.
  • Centralization creep: Too much control in a few validators, a foundation, or admin keys undermines the “trustless” promise discussed in Step 1.
  • Token inflation traps: High yields can hide dilution. In long bear markets, inflationary tokenomics can be fatal (ties to Step 6 and Step 7).
  • AI-driven scams and deepfake marketing: As AI improves, fraudulent teams can look more credible. Fundamentals must include stronger verification: real code, real usage, real governance, real legal entities when relevant.

Practical takeaway: future-proof fundamental analysis is not only “What is the project?” but also “Can it survive regulation, security threats, and market cycles while still growing adoption?”

4) FAQ

Q: What is fundamental analysis in crypto?
A: Fundamental analysis in crypto means evaluating a coin or token based on its technology, team, investors, use case, adoption, roadmap delivery, community strength, tokenomics, and supply-demand dynamics—not only price charts.

Q: Why does Step 5 focus on “Which cryptocurrency should we buy?”
A: Because asset selection is the foundation of any strategy. Timing and execution come later in technical steps (for example Step 8 to Step 11), but first you must choose assets with strong fundamentals.

Q: What is the fastest way to check a crypto project’s fundamentals?
A: Start with the official website, the whitepaper, the roadmap, and verified community/developer links (GitHub, X/Twitter, Reddit, Discord). Then confirm usage and distribution using on-chain data. Finally, connect it to tokenomics and supply-demand.

Q: Can a project have a great whitepaper but still be a bad investment?
A: Yes. Whitepapers can be marketing. You must verify delivery (roadmap execution), real adoption, security discipline, token unlock risks, and regulatory viability.

Q: Why is “trustless” important in crypto fundamentals?
A: Trustless systems reduce reliance on individuals or institutions. In fundamentals, this means checking decentralization, governance controls, admin keys, and whether the network can operate safely without trusting a single party (ties to Step 1).

Q: What comes after Step 5?
A: Step 6 – Tokenomics and Step 7 – Supply and Demand, where you learn how token economics, emissions, and market dynamics influence long-term value.