Sector valuation - engagement

How high community engagement translates into project growth

Assessing the fair value of tokens involves modelling how projects capture values. In this excerpt of Sygnum’s research report Valuing crypto assets, we explore how high community engagement with a project means growth.

This article is part of Sygnum’s Valuing crypto assets investment research report.

High engagement of a lot of people with a project usually precedes actual user growth.

Projects that succeed in building a strong community and capturing a lot of mindshare early on are usually able to convert it into strong network effects, such as user growth, developer interest and investor interest.

We can track the size of the communities and their activity levels on social media. Data on traditional and social media mentions are also useful indicators, especially when the data also capture whether a comment is positive or negative, whether it is picked up and amplified by others and whether the engagement is predominantly by bots.

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This document is purely for educational purposes and has been issued by Sygnum Group. It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a marketing communication. It does not constitute an offer or a recommendation to subscribe, purchase, sell or hold any security or financial instrument. It contains the opinions of Sygnum Group, as at the date of issue. These opinions and the information contained herein do not take into account an individual‘s specific circumstances, objectives, or needs. No representation is made that any investment or strategy is suitable or appropriate to individual circumstances or that any investment or strategy constitutes personalized investment advice to any investor. Therefore, you must verify the above and all other information provided in the document or otherwise review it with your external advisors. Some investment products and services, including custody, may be subject to legal restrictions or may not be available worldwide on an unrestricted basis. The information and analysis contained herein are based on sources considered as reliable. Sygnum Group uses its best efforts to ensure the timeliness, accuracy, and comprehensiveness of the information contained in this document. Nevertheless, all information indicated herein may change without notice.

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