Don't Confuse "DYOR" with Confirmation Bias in Crypto TradingIn the crypto space, influencers and self-proclaimed crypto gurus constantly tell you to " do your own research " (DYOR) while presenting coins that will supposedly do 100x or become the "next big thing." They always add, " this is not financial advice ," but few actually explain how to do proper research.
On top of that, most influencers copy each other, get paid by projects to promote them, and—whether they admit it or not—often contribute to confirmation bias.
What is confirmation bias? It’s the psychological tendency to look for information that confirms what we already believe while ignoring evidence that contradicts it.
For example, if you want to believe a certain altcoin will 100x, you’ll naturally look for articles, tweets, and videos that say exactly that—while ignoring red flags.
How do you distinguish real research from confirmation bias?
This article will help you:
• Understand confirmation bias and how it affects your investments
• Learn how to conduct proper, unbiased research
• Discover the best tools and sources for real analysis
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What Is Confirmation Bias & How Does It Sabotage Your Investments?
Confirmation bias is the tendency to seek, interpret, and remember information that confirms what we already believe—while ignoring evidence to the contrary.
In crypto, this leads to:
✔️ Only looking for opinions that confirm a coin is "going to the moon"
✔️ Avoiding critical discussions about the project’s weaknesses
✔️ Believing "everyone" is bullish because you're only consuming pro-coin content
The result?
• You make emotional investments instead of rational ones
• You expose yourself to unnecessary risk
• You develop unrealistic expectations and are more vulnerable to FOMO
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How to Conduct Proper Research & Avoid Confirmation Bias
1. Verify the Team & Project Fundamentals
A solid crypto project must have a transparent, experienced team. Check:
• Who are the founders and developers? Are they reputable or anonymous?
• Do they have experience? Have they worked on successful projects before?
• Is the code open-source? If not, why?
• Is there a strong whitepaper? It should clearly explain the problem, the solution, and the technology behind it.
Useful tools:
🔹 GitHub – Check development activity
🔹 LinkedIn – Verify the team's background
🔹 CoinMarketCap / CoinGecko – Check market data and tokenomics
2. Analyze Tokenomics & Economic Model
A project can have great technology but fail due to bad tokenomics.
Key questions to ask:
• What’s the maximum supply? A very high supply can limit price growth.
• How are the tokens distributed? If the team and early investors hold most of the supply, there’s a risk of dumping.
• Are there mechanisms like staking or token burning? These can impact long-term sustainability.
Useful tools:
🔹 Token Unlocks – See when tokens will be released into circulation
🔹 Messari – Get detailed tokenomics reports
3. Evaluate the Community Without Being Misled
A large, active community can be a good sign, but beware of:
• Real engagement vs. bots. A high follower count doesn’t always mean real support.
• How does the team respond to tough questions? Avoid projects where criticism is silenced.
• Excessive hype? If all discussions are about "Lambo soon" and "to the moon," be cautious.
Where to check?
🔹 Twitter (X) – Follow discussions about the project
🔹 Reddit – Read community opinions
🔹 – See how the team handles criticism
4. Verify Partnerships & Investors
Many projects exaggerate or fake their partnerships.
• Is it listed on major exchanges? Binance, Coinbase, and Kraken are more selective.
• Are the investors well-known VCs? Funds like A16z, Sequoia, Pantera Capital don’t invest in just anything.
• Do the supposed partners confirm the collaboration? Check their official sites or announcements.
Where to verify?
🔹 Crunchbase – Check a project's investors
🔹 Medium – Many projects announce partnerships here
5. Watch the Team's Actions, Not Just Their Words
• Have they delivered on promises? Compare the roadmap to actual progress.
• What updates have they released? A strong project should have continuous development.
• Are they selling their own tokens? If the team is dumping their coins, it’s a bad sign.
Useful tools:
🔹 Etherscan / BscScan – Track team transactions
🔹 DefiLlama – Check total value locked (TVL) in DeFi projects
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Final Thoughts: DYOR Correctly, Not Emotionally
To make smart investments in crypto, you must conduct objective research—not just look for confirmation of what you already believe.
✅ Analyze the team, tokenomics, and partnerships.
✅ Be skeptical of hype and verify all claims.
✅ Use on-chain data, not just opinions.
✅ Don’t let FOMO or emotions drive your decisions.
By following these steps, you’ll be ahead of most retail investors who let emotions—not facts—guide their trades.
How do you do your own research in crypto? Let me know in the comments!
