Metrics and indicators for analyzing DeFi tokens
Why you have to analyze DeFi metrics
Not only are proponents calling for immediate mass adoption of blockchain technology disappointing, but the many “digital mines” that exist in the crypto ecosystem, such as carpet painting and protocol hacking, have also created problems.
Investing is more than technical analysis and forecasting. Over the past year, a number of blockchain analytics platforms have introduced metrics that provide a better understanding of a crypto project’s core or support base.
P/S (Price-to-sales ) ratio
The price-to-sales ratio (Price/Sales or P/S) is calculated by dividing a company’s market capitalization (number of shares outstanding divided by share price) by the company’s total sales or revenue over the past 12 years. months. The lower the price-earnings ratio, the more attractive the investment. Sales prices provide a useful measure for inventory valuation.
The price-to-sales ratio shows the market’s valuation of each dollar of a company’s sales. This ratio is useful for evaluating growth stocks that are not yet profitable or are temporarily down.
For example, if a company is not yet profitable, investors can look at the P/S ratio to determine whether the stock is undervalued or overvalued. Investors may consider buying stocks with undervalued valuations if their P/E ratios are lower than those of their profitable peers. Of course, the P/E ratio must be used in conjunction with other financial ratios and metrics when determining whether a stock’s valuation is correct.
TVL (Total Value Locked )
Total Value Locked (TVL) in cryptocurrencies is the sum of all assets held in decentralized finance (DeFi) protocols that generate rewards, interest, new coins and tokens, fixed income, and more. Since blockchain services are peer-to-peer networks developed on a peer-to-peer basis, there is no central authority to govern, create or improve the ecosystem. Hence, crypto investors themselves are rewarded for building these networks from the bottom up using their coins and tokens.
This indicator is an important indicator for the entire DeFi market. TVL now stands at a staggering $169 billion globally, with Ethereum deposits taking the lion’s share from $400 million two years ago.
To get the current market cap, you need to multiply the circulating supply by the current price. To get the TVL ratio, you need to divide this market cap data by the service TVL.
In theory, the higher the TVL ratio, the lower the asset value should be; however, when we look at reality, this is not always the case. One of the easiest ways to implement the TVL ratio is to help determine whether a DeFi asset is undervalued or overvalued, which can be done by looking at the ratio. If it is below 1, it is underestimated in most cases.
Annual income from staking
The main benefit of staking is that you can get more cryptocurrency and the interest rates can be very generous. In some cases, you can earn more than 10% or 20% per year. This is a potentially very lucrative way to invest. The only thing you need is a cryptocurrency that uses a proof-of-stake model.
Staking is also a way to back the cryptocurrency blockchain you invest in. These cryptocurrencies rely on stake holders to verify transactions and ensure smooth operation.
Token Supply on CEXs
Catena X (CEX) is an undertaking to make an effective multi-chain move convention for interfacing numerous blockchains to work with exchanges and exchanges between various environments in a completely decentralized way. The help will be decentralized, secure and versatile, with a definitive objective of ultimately associating most existing standard blockchains. Multi-chain conventions will be intended to be quick, adaptable and minimal expense, giving truly necessary instruments in the biological system. The effective execution of this undertaking will give an answer that eliminates complicated and awkward systems from the multi-chain exchange condition, permitting clients to exchange and execute without restriction.
Catena X (CEX) tokens will be used for:
- Store of value
- Catena X-axis drive and power transmission
Unique Address Growth Rate
Arcane Research has announced that decentralized finance (DeFi), non-fungible tokens (NFTs) are growing in popularity, and transaction fees on the Ethereum network are increasing. The latest phenomenon began in 2020 during the “DeFi Summer”, a period of surge in DeFi users that led to increased network usage.
The proliferation of NFTs caused this problem and allowed Tier 1 tokens like Binance Smart Chain (BSC), Solana (SOL), etc. to connect users who were valued outside of Ethereum.
Inflation is the process by which a currency depreciates over time, causing the price of consumer goods to rise. Because most economists believe that some level of inflation is good for the economy, for example, the U.S. government has been printing money for decades, more than what consumers actually need. That’s why a 5-cent Coke half a century ago is worth a few dollars today.
Bitcoin, on the other hand, tends to appreciate faster than the U.S. dollar depreciates, going from almost worthless in 2010 to over $20,000 by the end of 2020. Declining, but the trend line has been rising over time. ) which makes Bitcoin an increasingly popular hedge against fiat currency inflation.
Project Documentation Completeness
The concept of owning cryptocurrencies can be divided into control and rights. To prove control of the cryptocurrency, you can move it or sign a message (i.e. show that you know the key). However, there is a fundamental risk that many people can control a cryptocurrency without legal rights associated with that cryptocurrency (for example, when two people know the private key). During a financial audit, you not only need to show the auditor that you know the private key, but that you are the rightful owner of the asset it protects. If the client has only a few addresses, the auditor can handle it manually. Given that each requires some time, documentation, and reporting to verify, the cost increases with the number of addresses. Interestingly, in the cryptocurrency space, Bitcoin Improvement Proposal 32 creates a standard whereby people who need many Bitcoin addresses can link them into so-called hierarchical deterministic wallets (HD wallets).
What can help you to analyzing DeFi token
DeFi is a term portraying monetary administrations accessible to anybody on a public decentralized blockchain network. This permits clients to make self-executing savvy contracts on the blockchain. The magnificence of DeFi is that it is liberated from the obstruction of brought together foundations that generally control exchanges.
The opportunity of DeFi has additionally prompted the utilization of non-fungible tokens, which have produced publicity from retail financial backers and establishments. Taking a gander at the latest things in the DeFi space, it is not difficult to see that the business will speed up market development. Industry information shows that in 2019, the market worth of DeFi items was just $700 million, while the market esteem has ascended to more than $100 billion.
Contrasted with conventional money, DeFi expects to change monetary administrations like exchanging, loaning, installments, and protection in a more decentralized way through blockchain. DeFi involves conveyed agreement in brilliant agreements, permitting distributed exchanges without the contribution of a focal power. For instance, DeFi gives a more proficient cryptographic check process for loaning and getting by incorporating brilliant agreements that characterize and control credit.
Check out the project’s community and developer activities
GitHub activity is an interesting indicator when analyzing ICOs and crypto projects. Developer time is a relatively expensive resource, and if many developers dedicate their time and skills to a given project, it can mean several things:
- These people believe the project will be successful
- Project provides more functionality
- It is unlikely that the program was just a fraudulent exit
Identify the majority owner sign who is
Investors who had the foresight (or wealth) to buy Bitcoin in the early days and then hold the cryptocurrency when it took off last year are now incredibly wealthy. (Read more: Who are the top 5 Bitcoin millionaires?) The world’s largest digital currency by market cap has done so well over the past few years, so many casual investors who seized the moment and saved BTC turned to become millionaire.
As the price of bitcoin skyrockets and more and more digital currencies flood the market, investors are looking for the next digital currency to make a fortune.
Token Balance Movements/changes on CEXs
Catena X sent off on October 6, 2021, when 31.5 million CEX tokens were stamped on Binance Smart Chain. Catena X will present to 63 million CEX tokens on the blockchain it runs on. The arrangement is to convey CEX tokens (eg BSC, ETH, ADA, and so forth) on each blockchain the task looks to fuse
Who Are the Founders of Catena X?
Catena X is the brainchild of designer Luuk Janssen with the assistance of Joud Haddad, both of whom have broad programming experience. Luuk and Joad met when Luuk was counseling on a side task that Joad was supporting at that point.
Where Can I Buy Catena X (CEX)?
Catena X is currently available as BNB pairs on PancakeSwap.