Crypto Project Checklist: 20 Due-Diligence Questions
Lesson 8 of 8 · Intermediate
What this checklist is for and how to use it
This checklist pulls every lesson in the course into one framework. Its purpose is not to tell you what to buy; it is to find the unknowns. Most large losses come from a question nobody asked.
How to use it:
- Mark each question with one of four labels: green (checked, no problem), yellow (has risk but is understood), red (serious warning sign) or unknown.
- Do not treat "unknown" as neutral. Information a project does not publish is itself a data point.
- A single red in the contract section, such as an active mint authority held by one wallet or a honeypot, can be decisive by itself. Do not add up scores in a way that lets reds hide behind greens.
- Write down the date of the review. Upgradeable contracts, unlock schedules and holder distributions change, and a review from six months ago does not hold today.
Part 1: Tokenomics (questions 1 to 5)
| # | Question | Where to check |
| 1 | What is the float, and how many times market cap is the FDV? | At least two data sites, plus total supply in an explorer |
| 2 | What share do the team and investors hold, and at what valuation were the private rounds done? | The allocation table in the project documents and funding announcements |
| 3 | When is the next unlock, and what percentage of circulating supply is it? | Documents, unlock dashboards and the vesting contract |
| 4 | What is the annual emission rate, and who receives the new tokens? | Documents and supply-over-time data |
| 5 | How does value reach the token: fees, buybacks or net burns? Is it funded by real revenue? | Protocol revenue dashboards and on-chain transactions |
If you have no clear answer to question 5, at least recognise that your risk is on the narrative, not on a mechanism.
Part 2: Contract and security (questions 6 to 10)
| # | Question | Where to check |
| 6 | Is the contract code verified in the explorer? | The contract tab in the explorer |
| 7 | Is mint or freeze authority active? Who holds it? | Token account information or contract functions |
| 8 | Is the contract upgradeable? Is the upgrade key in one wallet, or in a multisig with a timelock? | The explorer and the project's security documentation |
| 9 | Is there a buy or sell tax, a blacklist or a transfer pause, and can it be changed? | Contract code, simulation tools and the buy-to-sell ratio in the pool |
| 10 | Is there an independent audit that can be confirmed on the auditor's own site? Does the project depend on a bridge or oracle with a single point of failure? | The audit firm's website and technical documentation |
Question 10 is not theoretical. According to CoinDesk and Chainalysis, in the April 2026 Kelp DAO hack, which caused about $292 million in losses, a forged cross-chain message passed through a setup with only one verifier.
Part 3: Team, investors and marketing (questions 11 to 14)
| # | Question | Where to check |
| 11 | Is the team's track record traceable, whether public or anonymous? What happened to their previous projects? | Multi-year profiles and the public code repository |
| 12 | Have the announced investors confirmed it on their own official channels? | The funds' official websites and portfolios |
| 13 | Are paid promotion and influencer allocations disclosed? Does the hype come with a real product? | Social media, documents and a usable version of the product |
| 14 | Have the other parties confirmed the partnerships and exchange listings? | The official channel of the company or exchange concerned |
Parts 4 and 5: Liquidity and on-chain (questions 15 to 20)
| # | Question | Where to check |
| 15 | Are the LP tokens locked or burned? Until when, and who controls them? | The explorer and the lock contract |
| 16 | What is the real volume on reputable exchanges, and how does order book depth compare with market cap? | Data from the main exchanges, not the sum across all exchanges |
| 17 | Have the market-maker agreement and the tokens lent to it been disclosed? | Project announcements and documents |
| 18 | After excluding the pool, locks, burn address and exchanges, what percentage of supply sits in the top ten wallets? | The holders tab in the explorer |
| 19 | Were the first-block buyers or the large wallets funded from the same source? | Wallet transaction history |
| 20 | Do team, investor or vesting-contract wallets regularly send tokens to exchanges? | The explorer and address-labelling tools |
How to interpret the result
A completed checklist does not tell you whether the price will rise or fall. It only tells you what you are taking risk on. A few simple rules:
- Contract reds (questions 6 to 9) usually cannot be offset by the other greens.
- Many unknowns mean either the project is not transparent or you have not yet spent enough time. In both cases, do not rush.
- All green is not a guarantee either; the market, competition, regulation and crowd behaviour can still hurt a sound project.
Also check separately the rules on digital assets in the country where you live. Users in sanctioned regions should be aware that exchanges and protocols can restrict or freeze accounts, and we teach no way around such restrictions. We teach only mechanisms and risks.
Common mistakes
- Using the checklist to confirm a decision you have already made instead of genuinely hunting for risk.
- Adding up scores so that one serious contract red hides behind several greens.
- Treating "unknown" as neutral when missing information is itself a sign of risk.
- Doing the review once and never repeating it, even though contracts, unlocks and holders change.
- Relying on a single data source for supply, volume or holders without comparing a second one.
What do volume and data say here?
Roughly half of these 20 questions can be answered only with data, not by reading the project's site. A practical routine:
- A snapshot on review day: record market cap, FDV, 24-hour volume on reputable exchanges and the share held by the top ten holders, with the date.
- Volume quality: separate out the volume of low-credibility exchanges. An academic study published through the NBER estimated that, in a 2019 sample, on average more than 70% of reported volume on unregulated exchanges was wash trading.
- Flows: track transfers from team, investor and vesting wallets to exchanges.
- If it has a perpetual contract: open interest and funding show how much leverage is built on this token; heavy leverage on thin liquidity creates sharp swings in both directions.
- Repeat: take the same snapshot at the next unlock or every three months and compare.
Data does not turn any of these questions into a signal; it only replaces guesses with evidence.
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Frequently asked questions
What sections should a crypto project checklist have?
At least five: tokenomics, contract and security, team and investors, liquidity and market, and on-chain data. This 20-question checklist covers those five.
If every answer is green, is the project safe?
No. A checklist reduces known risks, but market risk, competition, regulation and crowd behaviour remain, and there is no guarantee of profit or of preserving capital.
How often should I repeat the review?
At least before every large unlock, after any contract upgrade and otherwise about every three months, because holder distribution and contract rules can change.
Education only, not a recommendation to buy or sell; we never give signals. Price examples are illustrative. Test any method on a demo account first, with strict risk management.