10 min read
Best Practices
Learn how to protect yourself and make informed decisions when participating in token presales. DYOR (Do Your Own Research) is essential.
Important Disclaimer
Cryptocurrency investments are highly speculative and risky. This guide is for educational purposes only and should not be considered financial advice. Always do your own research and only invest what you can afford to lose.
Identifying Good vs Bad Projects
Green Flags ✓
- KYC verified team with doxxed identities
- Smart contract audited by reputable firm
- Liquidity locked for 6+ months
- Active community with real engagement
- Clear roadmap and whitepaper
- Working product or detailed MVP
- Reasonable tokenomics (not 90%+ to team)
- Transparent fund allocation
Red Flags ✗
- Anonymous team with no verification
- No audit or self-audited contract
- Short liquidity lock (< 3 months)
- Paid followers, fake engagement
- Vague or copy-pasted whitepaper
- No working product or demo
- Team holds majority of tokens
- Pressure tactics ("buy now or miss out")
Security Best Practices
Secure Your Wallet
- •Never share your seed phrase with anyone
- •Use a hardware wallet for large holdings
- •Enable 2FA on all crypto accounts
- •Use unique passwords for each platform
Verify Before You Click
- •Always check the URL - beware of phishing sites
- •Verify contract addresses from official sources
- •Don't click links in unsolicited DMs
- •Bookmark official project websites
Research Thoroughly
- •Read the whitepaper and tokenomics
- •Check team backgrounds on LinkedIn
- •Review audit reports carefully
- •Look for organic community growth
Community Due Diligence
- •Join official Telegram/Discord groups
- •Ask questions and gauge team responsiveness
- •Look for red flags in community sentiment
- •Check for genuine user discussions
DYOR Checklist
Before investing in any presale, go through this checklist to ensure you've done proper due diligence:
Team
- KYC verified?
- Previous projects?
- Active on socials?
Contract
- Audited?
- Verified on explorer?
- No dangerous functions?
Tokenomics
- Fair distribution?
- Vesting schedule?
- Reasonable team allocation?
Liquidity
- Lock duration?
- Lock percentage?
- Trusted locker?
Smart Investment Guidelines
1
Diversify Your Investments
Don't put all your funds into one presale. Spread across multiple projects to reduce risk.
2
Set Investment Limits
Decide how much you can afford to lose and stick to that amount. Never invest emergency funds.
3
Have an Exit Strategy
Know when you'll take profits or cut losses. Don't let emotions drive your decisions.