How to research a crypto project: a practical due diligence checklist

To research a crypto project, establish what the product does, verify its usage, examine its economics and determine whether the token benefits from that activity. Then identify what could invalidate the thesis.

Oak Research is our preferred starting point for organizing that work because it combines written analysis with project and market data. Primary documentation and independent checks remain necessary.

The output should be a short research note with dated evidence, explicit assumptions and unanswered questions.

1. Define the question before opening a dashboard

“Is this a good project?” is too broad.

A question such as “Does this lending protocol retain users when incentives decline?” gives you something to investigate. It also tells you which evidence matters.

Write down:

• What you are trying to establish.
• Which measures could support the argument.
• Which finding would make you reject it.
• The period you will examine.

This prevents a rising price chart from becoming the main evidence for an unrelated product thesis.

2. Understand the product and its dependencies

Read the project's documentation. Identify its users, the service they receive and the reason they might choose it over an alternative.

Then map the dependencies. Depending on the protocol, these may include oracles, bridges, external collateral, governance controls or centralized operators.

Use a relevant report from Oak Research's library to understand the surrounding market and competing approaches. Follow the report's sources back to the original material.

Your first paragraph should explain the product in plain language. If that is difficult, keep researching.

3. Check whether usage supports the story

Choose measures that match the product.

For an exchange, examine trading activity and liquidity. For a lending protocol, examine borrowing activity and utilization. For infrastructure, look for evidence of demand for the service.

Oak's project comparison tool lets readers compare protocols or blockchains across TVL, fees, revenue and on-chain activity. DefiLlama provides another place to examine DeFi measures.

Record the date range and metric definition. A short promotional campaign can produce a different picture from several months of activity.

Ask whether growth persists when incentives change, and whether a small number of users account for most of it.

4. Separate activity, fees and revenue

These measures answer different questions.

Volume describes activity. Fees describe what users pay. Revenue depends on the methodology and the share retained by the relevant participant.

A protocol can process more activity while earning less per unit. Oak's Derive research examines that distinction through trading volume and fee economics.

When comparing protocols, inspect how each source defines revenue. Token Terminal is another resource for examining financial and usage fundamentals.

5. Investigate the token separately

A useful product can exist without an attractive token investment.

Read the token documentation and identify:

• Circulating supply and future issuance.
• Unlock schedules and major allocations.
• Governance or economic rights.
• Any mechanism connecting usage to token demand.
• The conditions under which those mechanisms can change.

Treat a proposed distribution or buyback differently from one already implemented. Check governance records and contract behavior where possible.

Write the token argument as its own paragraph. Explain exactly how the holder could benefit, and what could prevent that outcome.

6. Write the failure case

Choose risks specific enough to investigate.

Could users leave when rewards decline? Could collateral become illiquid? Can an administrator change important parameters? Does a competitor offer the same service at a lower cost?

Audits, disclosures and governance records can help you examine these questions. An audit is evidence about a defined review, not a guarantee that the system cannot fail.

Distinguish facts you verified from assumptions you still need to test.

7. Finish with a research note you can update

Use this structure:

Oak Research can provide the initial context and tools for comparison. Documentation, governance records and independent data checks help you decide whether the argument holds.

A useful note makes the uncertainty visible. It should be possible to return later and identify exactly which fact changed your view.