Monitoring on GitHub as a Model for Evaluation of Crypto Projects

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This article will get you acquainted with the idea of tracking the activity of GitHub as a way of evaluating projects of crypto assets and whether this approach merits inclusion in the arsenal of the crypto-investor. Despite the fact that the crypto-active market is developing at a tremendous pace, there is still no consensus on how to determine the "fair" value of an asset in today's market.

Several estimates have been proposed, but unlike share markets, where discounted cash flow models and accounting factors have become standards for price determination, new models for estimating crypto assets continue to emerge. And one of the most common is monitoring the development of the project on the service GitHub.

"Activity on GitHub" and evaluation of projects

Activity on GitHub evaluates the work of developers in open source projects (like Bitcoin or Ethereum) in the popular service-repository of the GitHub code. The theory is that the more people work on a cryptocurrency project, the more opportunities and improvements one can expect - and the more people believe in the future success of the cryptocurrencyThus, the probability that the project will be successful becomes higher. All this can have a positive effect on the value of the currency or the project's token.

Evaluation of the Cryptocurrency for the work of developers

The developer contribution is an approved change to the project source code, which is approved by the community and administrators. At the same time, in good projects, such changes can be set for one day.

The use of such improvements as a way to evaluate a cryptocurrency project is one of the methods for evaluating projects (for example, it uses the CryptoMiso resource). Using this approach, you will receive a list that is very different from the list of assets estimated in accordance with market capitalization.

According to the same CryptoMiso, the five best crypto assets in the past three months are 0x (ZRX), Nuls (NULS), aelf (ELF), EOS (EOS), and republic protocol (REN), respectively. Ethereum (ETH), the second most important cryptocurrency project measured by market capitalization, appears in the list at number 67 following such projects as Ethereum Classic (ETC), Nebulas (NAS), Bitmark (BTM2), and TrustNote (TTT).

Although at first glance this seems to be a well-grounded approach, there is a nuance. For example, branched projects inherit all the improvements of codes of their predecessors and thus already have good statistics. And not only branched projects have such an advantage. For example, the project DigitByte, its altcoin command copied the Bitcoin code and so on GitHub it has more than 17,000 "improvements". Ranking by the number of improvements on GitHub does give some food for thought, but everyone should know that this also has its limitations.

So what are the developer activity indicators that matter?

Investors can still use the developer's activity to evaluate the projects of the cryptocurrency. But it is necessary to take into account different indicators. For example, the platform of cryptographic analysis Santiment has developed a 30-day rating based on developer activity, which includes the number of code pulses, interaction with queries, interaction of queries with the query, editing the Github widget and comments on improvements.

This approach ensures that the developer's activity can not simply be "inherited" in the case of a fork, and that historical track records cannot be changed and that the activities associated with the developer are not limited to improvements. This leads to a clearer 30-day rating of activity, which is much more similar to the rating of the market for crypto-currency projects on capitalization.

Evaluation of cryptographic assets

When trying to determine the future fair value of a crypto-currency asset, there are several indicators that can be taken into account. Market capitalization, the relation "Network cost to transactions" are examples of how crypto projects can be evaluated. The developer's activity on GitHub is potentially important for pricing, but the formula requires the right mix of developer activity indicators for more advanced modeling.

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Disclosure:

I have received no additional compensation other than the Ethereum that Hade Technologies pays to produce Exclusive content



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Thanks for this insight

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