Whether you’re new to the cryptocurrency universe or you’re a seasoned HODLer—many Altcoin afficionados are on the lookout 24/7 for fresh and lucrative investment opportunities.

But given the market volatility and the abundance of Altcoins to choose from, it isn’t always easy to fight #FOMO (the Fear of missing out), this urge we all know, namely: to join and not miss the Moon-Train.

I know, because I’ve been there. That’s why I created a Google Spreadsheet to help me evaluate and rationalize my decisions when choosing Altcoins to take a long position in. The purpose of this spreadsheet is to investigate the long-term investment potential of an Altcoin based on qualitative and quantitative factors, all the while making an effort to avoid the pitfalls of psychological biases, as outlined here.

And I would like to share it with you — make a copy and save it to your own Google Drive. You will find instructions how to use the sheet down below.

This sheet I call the “Altcoin Evaluation Spreadsheet” can be of help if:

You are interested in a long-term investment in an Altcoin (18 to 60 months)

You want to analyze a Cryptocurrency and investigate its fundamentals

You want to find out more about and evaluate this gem that is being shilled on #Crypotwitter

Some of the evaluation questions can also be of help if:

You are interested in an ICO and want to find out more

It’s of less to no use if you’re day or margin trading, as other aspects factor into these decisions. The longevity and sustainability of the project is what this analysis spreadsheet focuses on.

You can open the spreadsheet here. Make a copy of it and save it to your own Google Drive. If you find it helpful, make sure to follow me on Twitter (@steakhodler) and I’d love for you to share it in your community—and a virtual cup of coffee in form of a tip is always appreciated:

BTC: bc1qyv4npu42e26k20ypzp0gdzgjslq790rpfmqd5u

BCH: qzj958g6q7lvegywu99pqvx3waqe0xn2uqqs3rr23q

ETH: 0x7495bE836FEd52d8f408c53a8Ef20c57214D6E17

LTC: ltc1qtmnuvs96l5gsmg4qe882apmtg28nc2axntnne9

XRP: rLkjm3p8WTgF3Mc9ZLhXpUuK4XpdtGaLrw

The first time I used this spreadsheet for myself I was looking into $PCN / $DAPS and $SNTR / SilentNotary (hence the use of these currencies as examples in the sheet). But it can used for any Altcoin (or even ICO, minus the market factors).

I have employed it a few times since—as for results, we will see. As I mentioned above, this spreadsheet is first and foremost an aid to making an informed decision when contemplating a long-term investment in an Altcoin / Cryptocurrency. Important: There is no need for a coin to get a highscore to be considered for an investment—find out what your most relevant factors are and weigh the score accordingly, and then even a yellow rating can be a promising position.

Disclaimer: This article and the spreadsheet are not trading advice! I am not a registered broker, analyst, investment advisor or anything of that sort. The information provided here is purely informational and educational purposes and should be independently verified and confirmed. You partake of this information at your own risk!

The time to fill out the Altcoin Evaluation Spreadsheet can take anything from 15 minutes to a couple of hours, all depending on which cryptocurrency you’re investigating and how much effort you’re willing to put in.

Personally, I find due diligence, otherwise known as #DYOR (Do your own research) to be the most important aspect when looking into a long-term investment. I don’t care if I’m handling 10 Euros or 10 BTC—I always do my research.

This spreadsheet helps me save time and work through the pertinent questions, essentially stopping #FOMO from getting the better of me. It is an orientation, a compass. It goes without saying that no spreadsheet will be able to reduce the general risk of investing in the volatile cryptocurrencies market—but it may help minimizing the chances of falling for a scam or unwanted pump and dump scenario.

Without further ado, let’s dive into the instructions

How to use the Altcoin Evaluation Spreadsheet

Please open the sheet. The sheet is divided into a qualitative and a quantitative category and both are subdivided into several factors, with a sum total of 22 questions and answers factoring into the final score: Potentially good investment, Put on watchlist or Hold off for now.

Screenshot of v1.0

This approach is inspired by the Levermann strategy for long-term stock investments that equally takes hard and soft facts into consideration. I ask questions for each factor and distribute points accordingly, with a final score that gives me an indication of potential. (Please install the Cryptofinance Add-on in your Spreadsheet (Add-ons > Get add-ons), then input the currency symbol in the field in the sheet).

Let’s take the questions one by one and I’ll explain my approach.

Qualitative

Team

For a long-term investment, I find the setup of the people behind the product and coin are far more important than the product itself. Traction forms around people and based on emotional components. These soft facts are paramount for the long-term success of an endeavor. As @crypto_rand so rightly says on Twitter:

Best technology ≠ Success Many techies are not able to understand that the success of a project mostly comes from a good network and a right timing with real world needs/sentiment. No matter how smart some of these guys are. They are biased.

There is a lot of truth to this. Therefore, these are the questions I ask regarding the team:

Does it have a verifiable team (eg. Do they have real LinkedIn-Accounts? Are their CVs authentic?): Check the team. Are the members legit? Try a Google reverse image search and rule out that they are using stock photography or stealing someone’s identity. Do they have a LinkedIn account? Can you verify their CV? If everything checks out, add a score for this question accordingly (instructions for the score be found in the spreadsheet below each question).

Does the team and / or advisory board have verifiable expertise in the field their blockchain product is in?: Just because they’re real people doesn’t mean they’re the best fit for their endeavor. So take a closer look. What did team members and advisors do before? What experience do they have?

Are there verifiable endorsements / partnerships?: Sometimes, a coin or ICO seems to good to be true. Partnerships and endorsements on their website seem like a blockchain dream come true. Sadly, there have been cases where partnerships have been lied about—so do your own research here. By the way: If there is no partnership yet, this might change in the future. Feel free to come back later and adapt your score to reflect current developments. A coin on the watchlist can always turn into a potentially good investment with time passing by.

Are team members and / or advisors outspoken about their product?: Don’t underestimate the power of the people involved. Look at Justin Sun of TRX fame: Despite the criticism and backlash surrounding his company, $TRX has been going fairly steady and has overwhelming support from the community and investors. Based solely on the team factor, $TRX is a solid investment.

Another example: I mentioned my personal investment in $PCN / $DAPS earlier. Now, based on the first and second question, $PCN / $DAPS doesn’t score a point, as their team is pretty much pseudonymous. But then again, that is their product: a decentralized anonymous payment system. Naturally, the founders would be pseudonymous. What swayed, therefore, was the way they openly communicate, the transparency of the whole project—and the outspokenness (and marketing). I hope this example helps illustrate how important #DYOR is.

Last but not least the level of involvement of the team is an indication for a project that is still alive. There are loads of cryptocurrencies in the low caps, but many are dead and there’s no significant movement to be expected. Don’t buy a corpse.

Marketing / Media

My day job is in PR so I feel fairly qualified to speak on this subject: The way you market your project to your customers is half the battle—think Dogecoin. So it’s consequential you would look into how your potential investment fares in this regard.

Is the marketing strategy solid?: Is there any marketing at all? Do they have a marketing specialist on board? A spokesperson? How are they on the art direction side?

Is there media coverage that is not paid for?: Nothing easier than getting paid reach and coverage if you’re willing to pay for it. It’s much harder, especially the state “crypto journalism” is in, to get organic coverage. If there actually is coverage of a coin that wasn’t paid for, this indicates that the project was able to generate substantial interest, or at least they are good at networking and pitching their stuff. Both is good for the potential success of a coin.

Is there an animated community supporting the product / coin?: Look at $XVG—despite the negative press of the past weeks, the cryptocurrency managed to climb in price. This is no doubt down to a devoted community of HODLers and supporters who want to see the project through to fruition. The same goes for $XVG’s competition: $PCN / $DAPS. They are always there to speak up for the Altcoin they believe in. No matter what your belief system is, if you’re looking for a good reason to invest in a coin, a passionate community is a relevant factor to base your decision on. Investigate and distribute points accordingly.

Volume of 24 h mention count on Social Media Social Media / 24 h Sentiment level: This spreadsheet makes use of the Cryptofinance Add-on for Google Spreadsheet to collect data automatically from Coin Market Cap. As the add-on is only used in three fields, you can work without it, but it makes this part a bit more efficient.

What we are doing here is taking a look into how much chatter there is on Twitter and Reddit and what the sentiment is towards the coin we are looking into. Hey, but what if it’s a pump and dump and just being shilled excessively right now, you may now ask. Valid question—we will balance this factor out shortly.

Caution: The add-on pulls the social volume and sentiment data from Solume. When looking into small cap Altcoins and ICOs, there’s a fair chance it is not listed on Solume yet and the field will produce an error. In that case, invest the time and do a manual search on Twitter and Reddit and get a feeling for the current sentiment.

Product

Ist there a working product?: Now here’s the thing—investing in cryptocurrencies is de facto a gamble. My little spreadsheet won’t change the fact that you are effectively betting on a positive outcome of your investment. What we are trying to do is minimize risk by examining as many factors as necessary and as little as possible. Whether there is already a working product to show off is actually not that important in cryptospace at the moment. Take EOS: They collected 4 Billion with a promise.

But as we are taking a look at a long-term investment, it is of course of interest to see how far along the project is. In my template, a working product gives you +1. But I would absolutely consider a different approach as well. For example, you could take the standpoint that a working product is a -1 due to the fact that it doesn’t seem to have propelled the value of the currency.

For me personally, I am going with the first variant, but I think it’s absolutely plausible to nullify this factor altogether, depending on your personal preferences.

Does the product have a real-world purpose? / Does it have a real-world market?: Now this aspect I find far more interesting than the aforementioned. Because this factor has the possibility of opening up the project to a market outside of crypto. Think: Mainstream usage. While it is absolutely possible for a coin to moon in its community alone, we are in this scenario aiming for a long-term investment. Hence, the longevity of the project is relevant for our evaluation. To be precise: Of course any cryptospace-only use case is real world, too. What I mean here is basically your Uncle Vinny whose tech savviness ends is excelling at Candy Crush and checking his Facebook settings being able to fathom and use the product.

Example: Silent Notary ($SNTR). The project “is a multiplatform decentralized service for confirmation of event existence. SilentNotary converts an event into legally significant evidence, excluding the possibility of falsification.” The name Notary is therefore more than fitting. An electronic notary with a host of integrations and interfaces is something that has big potential in a real-world market, not least because it brings cost efficiency to the notary system.

Does it have a crypto market?: This is no less important. Even 10 years after Satoshi’s white paper, we are still in the teenage years of Crypto and the blockchain. Number one consumer segment is the crypto space. So it should also have potential for this segment, as well.

Does blockchain technology add to the product?: While this may be irrelevant for short-term investments, I find this to be an interesting factor in the long run. What with 2017’s hype, Long Island Ice Tea adopting Blockchain in its name and a legion of ICOs promoting products that essentially boil down to “Familiar product or idea, BUT with blockchain tadaaa”, there are far too many projects that could work perfectly without the blockchain technology. In other words: Just because you’re a database doesn’t make blockchain necessary.

Again: Totally irrelevant in a pump and dump or margin trading scenario. But if you want your investment to be around come 18 months later (or later than that), it’s probably good to take a look at how native to this technology environment the project actually is.

FOMO

FOMO is short for the fear of missing out, with FOMO basically being the antonym of FUD (Fear, Uncertainty, Doubt). While the latter tends to make people sell frantically, aiming to cut losses, FOMO makes people buy into something because of peer pressure, often without any prior research, only on the grounds of ominous “signals” or Social Media chatter.

Remember how we measured Social Media volume and sentiment? Here is the part where we balance it out.

If you are reacting to a price spike, are there news or announcements that might explain the spike?: We’ve all been there. Browsing CoinMarketCap or CoinCheckup, we come across this small cap with the 1 hour and 24 hour growth in double or triple digits and a spike steeper than the North Face. Very often, this is where FOMO kicks in. But instead of reacting with an impulse buy, #DYOR: Has the project announced an exciting development? Was there coverage in the news? If not, move on quickly to the next question.

Is there a high volume of chatter on Twitter inferring it is being pumped right now?: Now I am absolutely not anti pump and dump. We’re all adults and it is our responsibility to handle our emotions and weigh the facts. Crypto is a gamble per default. Also, if you’re into gambling per se, like sports bets or horse races or Eurovision Song Contests, participating in a pump and dump is just another scenario where timing, but especially luck plays a role. So if you like that, go ahead. This article features the positive sides of p&d.

That being said, the basics of a pump and dump scheme make it likelier than not that you will be late to the party. You probably won’t register a significant margin and you might even lose a bit in the following dump.

Not every massive spike is due to p&d. Therefore: If you registered a high volume of chatter on Social Media in your research so far, go to Twitter-Search, input the currency symbol and analyze the chatter.

Quantitative

Exchanges

Exchanges are the life and soul of the crypto trading party. They are also a deciding factor in what makes and breaks the value of a currency. This boils down to the available liquidity. Rule of thumb: The more exchanges your coin is on, and the bigger these exchanges are, the better it will fare mid and long-term.

Welcome to the quantitative part of our evaluation.

Listed on Top 15 Exchange?: Based on their trading volume pulled from a couple of websites, I have put together my personal Top 15 of Exchanges worldwide (you find the list in the second tab in the spreadsheet) including the #1 Binance. Feel free to adapt it for your purposes.

If your coin is included on one of these exchanges, that is a damn good sign.

Listed on at least 2 minor exchanges?: Especially small caps and young coins find it challenging to be listed on major exchanges. The good thing is, there is a host of alternative exchanges with smaller volumes where low caps can find a home, for example: Cryptopia, Kucoin, Hotbit, Bleutrade, Cryptohub or TradeOgre, to name a few. So even if the coin in question is not listed on a major exchange yet, there’s still a fair chance it’s getting exposure and is on the road forward.

If neither of the two apply: Are future listings announced?: Even if neither of the prior questions apply, this needn’t be a red flag per se. Maybe the project is still in its beginnings. Check the website and social media channels or Bitcointalk for announcements regarding listings, or reach out to the team via Telegram and Discord. Of course, if there is no listing at all in the near future, this does increase the risk for your investment right now. That’s why I’ve set the points for a negative answer to -2 here.

Price

In this part, we simply look at the price development over a set period of time—I’ve chosen 7 days back (starting from the date of your research), 30 days back and 45 days back. You can find this information on the historical data page of the cryptocurrency in question on CoinMarketCap.

What I look for is a steady increase over time. If the 7d value is higher than the 30d and 45d price, than this would result in the highscore for this particular question, indicating healthy growth. A 7d value that is lower than the 30d value but higher than 45d is still ok—this can be explained by market volatility, but might warrant further research.

I would have preferred a longer period of time for evaluation, but given the fact we might be looking at young coins, this is a compromise. But feel free to adapt the range for your needs.

Market

The same principle applies to Volume and Market Cap. The steadier the increase, the better.

Final Score

The points you have distributed will have automatically added up, and depending on the height, it will light up green, red or yellow. Please remember: This score is not a verdict. It is a compass and orientation for your personal, final decision.

There are many factors beyond this spreadsheet involved, a bear or bull market, for example, or the coin’s price against Bitcoin and other currencies. These are aspects you will have to consider. This spreadsheet is a starting point.