A systematic 12-check due diligence framework takes 60-90 minutes per project and eliminates the most common costly mistakes. Applied consistently, it separates disciplined investors from FOMO speculators. Here is the complete process.
Team Checks (1–3)
1. Identity: Google each founder. LinkedIn profiles must predate the project by years. Reverse image search profile photos. No prior verifiable history = immediate disqualification.
2. Track record: Have they shipped working products? GitHub contributions to prior projects? Crypto credentials go back further than the current project?
3. Advisers: Do named advisers publicly confirm involvement on their own channels? Unverifiable advisers are often listed without consent.
Technology Checks (4–5)
4. Audit: Published report from a recognised firm (Trail of Bits, OpenZeppelin, Halborn, CertiK)? Critical/High findings resolved (not "acknowledged")? Verify at the firm's website, not just the project's claim.
5. Working product: Active GitHub (commits in last 30 days, multiple contributors)? Testnet or mainnet users? Empty or private GitHub = red flag.
Tokenomics Checks (6–8)
6. FDV vs comparables: IDO price × total supply = FDV. Compare to 5+ working comparable protocols on DeFiLlama at equivalent stage. Over 3× comparables = expensive.
7. TGE float: Under 5% circulating at TGE = severe 12-36 month dilution risk. Healthy: 15-25% with gradual vesting.
8. VC quality: Named VCs appear in their own official portfolio pages? Tier 1 backing (Paradigm, a16z, Multicoin) is the strongest third-party quality signal.
Market Checks (9–10)
9. Problem-solution fit: One sentence: why would users switch from the existing solution to this? No clear answer = weak positioning.
10. Liquidity plan: 20-40% of raise to locked DEX liquidity (UniCrypt, 12+ months). Under 10% = immediate trading risk.
Platform Checks (11–12)
11. Community quality: 50+ messages read across 3 days in Telegram/Discord. Technical discussion and critical thinking signal organic community vs. shill-only groups.
12. Launchpad vetting: Platform applies quality standards (DAO Maker under-5% acceptance) vs. permissionless listing (anyone can launch)?
For the fraud protection guide extending this checklist, see our crypto fraud protection guide. For the smart contract audit guide covering check 4 in depth, see our smart contract audit guide. For the FDV guide covering check 6, see our FDV guide.
Glossary
- DYOR
- Do Your Own Research — the standard crypto disclaimer emphasising independent research over influencer tips or community hype.
- Problem-Solution Fit
- The alignment between an articulated real-world problem and a protocol's proposed solution — foundation of sustainable protocol value.
- TGE Float
- The percentage of total token supply circulating at Token Generation Event — determines initial dilution risk from future vesting unlocks.
Disclaimer
Important: Passing all 12 checks reduces but doesn't eliminate investment risk. This guide is educational only. CryptoPresaleNews.com is not a licensed financial advisor.
