5-star system

A quick and easy system developed by Muneeb Ali, Co-founder of Blockstack, to evaluate new tokens.

Spacesuit X

A rating scale of 0–100 which is based on an acronym for 10 categories that investors/analysts might consider regarding tokens, coins and ICO offerings. Developed by Bruce Fenton

Expert Framework

An interdisciplinary group of crypto enthusiasts, developers, entrepreneurs, researchers and investors pulled together a framework. Contributors here.

5-star system

Spacesuit X

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This system has been put together by Muneeb Ali, Co-founder of Blockstack. This guide is written in his words and taken from the original post. All credit goes to him.
(The framework has been tweaked to become 25-star system, 5-star ratings for each aspect.)

"I’ve been working in the blockchain industry since late 2013, and a lot of friends have recently started asking about how should they evaluate new protocol tokens. Here is a 5-star system that I use:

Code speaks louder than words

When I come across a new protocol token, I skim the website and go directly to any link to the open-source code. The code quality and commit history tell me more about the project than all other metrics combined. If there is no code for the project, then the next best thing is relevant code commits of the lead developers. Vitalik Buterin didn’t have a live network for Ethereum, but he made pybitcointools — a popular Bitcoin library — and Ethereum had a testnet and proof-of-concept clients.

A team with the relevant expertise

Open-source code is not enough. Projects can have working code but can have flaws at the protocol design level, e.g., design a system that works at a small scale but breaks if used in production. Such mistakes are harder to catch. I look for a deep background in distributed systems and/or applied cryptography for the core team members. If no one on the team has deep expertise in these fields, then the probability of protocol flaws is higher.

Peer-reviewed technology

There is an unfortunate trend in the blockchain space, where anyone can put up a whitepaper on a website and claim that they have a “novel solution” to a hard problem. Recently, these whitepapers are becoming less about the technology and more about token distribution plans. Having a peer-reviewed publication at a top computer science conference is a high-quality signal. It means that (a) the project is onto something truly new, (b) they’ve studied previous efforts, and (c) they’ve cleared the bar of peer feedback from relevant experts in the field.

Usefulness of the token in the protocol

If the token in the protocol is not clearly needed, i.e., is not tied to a scarce resource that is essential to the functioning of the protocol then the token is more of a marketing play. For Bitcoin the scarce resource is currency, for Ethereum the scarce resource is computing-power, and for Blockstack the scarce resource is digital property (like domain names). If there is no scarce resource, there is no need for a protocol token.

Organic interest from developers & enthusiasts

Finally, I look for signs of organic interest from developers and early adopters. You can get a sense of this from engagement in Github issues, by reading public forums, and by looking at the attendance of developer meetups. I mostly ignore any professionally prepared marketing material (websites, brochures, pitch decks).


This system has been put together by Bruce Fenton, CEO Chainstone Labs, Atlantic Financial & The Satoshi Roundtable, Board Member Medici Ventures & Bitcoin Foundation.. This guide is written in his words and taken from the original post. All credit goes to him. Check out his site for an online calculator for yourself or Get Started to contribute to CryptoReview.

I’ve made a simple tool called SPACESUIT X for analyzing the investment merits of coins, tokens, ICOs and similar projects. SPACESUIT X is a rating scale of 0–100 which is based on an acronym for 10 categories that investors / analysts might consider regarding tokens, coins and ICO offerings. The tenth category is “X Factor” which allows analysts to assign their own criteria for evaluation.

How does it work?
The default value for each category is 10. Analysts score each category on a 0–10 scale with 10 being the highest. For example, if an analyst felt Bitcoin had very good security they might rate it a 9 or higher.

Each category is then added up and totaled. This gives projects a final score of 0–100 with higher scores being better. The default weighting for each category is 10…so 10 points each, 10 categories = 100 total possible points. Analysts who wish to weight a category differently can do so. For example if someone thinks security should be 20% of a project, not only 10% of the analysis they can change the weighting to 20, adjust the others to total 100 and this will be reflected in the other categories and final totals.

Alternatively, analysts can keep the default weighting and apply thier own additional screens/ metrics. For example: “Use the default weighting of 10 for security but I won’t consider any project which has a security score of less than 7 and an overall score of below 75.”

There is a great deal of flexibility for analysts to adjust the system for thier own preferences. For example the section called “Community & Management” only lists criteria which should be considered…this analysis protocol doesn’t make a judgement call on whether something is good or bad, that is up to the individual analyst. So if an analyst strongly prefers open source versus a corporate model they can reflect that in thier rating. One analyst might place a heavy importance on a fixed supply, another may rate a coin highly on Accounting & Legal based on the jurisdiction that they are in. This allows each analyst to rate each category based on thier own preferences.


How secure is this? Security is the foundation of any crytpo or blockchain project. Factors to be considered are the security of the blockchain being used, centralization, control and an analysis of attack vectors on the chain, coin, project and any related smart contracts.


What are you participating in with this token or coin? What portion of earnings or equity of a project does my token represent (if any)? Have you purchased a security? An app API key? A share of future of revenue? Have you simply donated to a non profit tech foundation? What portion has been diluted and how? How fair and transparent was the issuance process?

Accounting & Legal

How are holdings calculated? On a public, open blockchain or by a central party? What, if any, is the corporate structure of this project? Is it open source? Are there significant legal risks for any key contributors, managers or entities involved in this project? Is this project legal in the jurisdictions important to you? What user rights (if any) are a natural part of the code?

Community, Management & Team

Who is working on this project? Is there a community? For FOSS (Free and Open Source Software), who contributes how when and why? Is it open or controlled? For corporate, non open-source projects, who is the team and what is thier track record? Who are the executives behind this? What have they done before? Have they ever managed similar amounts of money and numbers of employees successfully?


What is the economic size of transactions in this asset? What are the earnings and projected earnings of this project and/ or this part of the industry (if any)? Projected growth rates? Is this being used or bought for something other than speculation? Who is buying? What do they pay? What will those amounts be in the future? Most importantly, how does my token tie to these earnings? (If at all)

Supply & Demand

Is supply fixed or limited? How many coins or tokens will be issued? How? Who can change this? Who controls large amounts of coins? What is the real market strength and market cap value? Is there enough market depth to actually support significant sales at a similar price or is it too thinly traded?


What will the project, coin or token be used for? If not usable directly, what is the share of equity it gives you? Is the project a useful application? Does the token represent something else of value? What? How? What does this token, coin or project do? What is the problem solved by this? Do people or will people use it? Why?

Industry / Institutional Backing

Are corporations or vcs participating? Do exchanges list this token or coin? Do companies build businesses around this? Does the project have any major industry or non-industry partners? What is the overall market direction? How about for this type of project? Whats the state of the industry? Who is the competition? What is this projects leadership in the space for this use case?


What are the technical details? If this is using a blockchain does it need one? How much has this been tested? Are the speed and efficiency drawbacks of a blockchain worth it for this project? Why? Is this blockchain open or permissioned? How resistant to censorship is this blockchain? What anonymity features does the tech offer?

X Factor

What other factors would you like to include in your analysis? What is the overal thesis? Why will the markets place value on it? What other risks are there?
The X Factor slot is your chance to add any criteria that was missed.


- Provide a checklist ✅ and guide for serious entrepreneurs to prepare for their TGEs
- Establish best practices for a qualitative and quantitative fundamental analysis of digital assets
- Share the most relevant data sources and resources to dive deeper

Core Team & Advisors

Experiences & Achievements
Source: Linkedin
Comments: Full Bios, no contradicting information online

Complementary Skillset
Source: Linkedin
Comments: Orgchart, clear responsibilities, # of core team over time

Background checks
Source: Reference Calls, https://onfido.com/, https://haveibeenpwned.com
Comments: No criminal actions, reliability, responsibility & trustworthyness

Sufficient professional Network
Source: LinkedIn, Twitter
Comments: Industry sector network, Crypto Community Network

Leadership & Integrity
Source: Social Media, Coinfund Slack
Comments: Culture, Mission statement, firm leadership, coworker / employee feedback, ability to build a community around their project

Community & Supporters

Web Popularity
Source: http://www.alexa.com/siteinfo, https://trends.google.com/trends/?hl=en,
Comments: Growth rates, absolute traffic, benchmark w competition

Sentiment analysis
Source: https://site.cointerminal.co/, https://santiment.net/, https://www.quandl.com/, https://cindicator.com/
Comments: "Is overall sentiment positive / negative; visible trends; abrupt changes in sentiment - reasons & events"

PR & Branding
Source: https://coinfund.io/, http://icoalert.com/, https://www.forbes.com/podcasts/unchained/#16735bfc5b4f, https://www.smithandcrown.com/, https://bitcoinmagazine.com/, https://epicenter.tv/, https://www.coindesk.com/, https://www.bitcoin.com/, https://tokenmarket.net/, https://www.cryptocompare.com/, https://www.tokendata.io/, https://cointelegraph.com/, https://medium.com/token-economy, https://thecontrol.co/, https://consensys.net/
Comments: Coverage by top crypto media, comment sections, Podcasts, Blogs, Reddit, Twitter, ICO Platforms, Research Institutes

Social Signals
Source: https://www.coingecko.com/en, https://www.cryptocompare.com/coins, Slack, Telegram, Facebook, Twitter, Reddit
Comments: Followers, Activity, Sentiment

Signaling by smart money Investors
Source: https://www.crunchbase.com/; https://angel.co/;
Comments: Short list: USV, Polychain, DCG, Pantera, Blueyard, Blockchain Capital, Coinfund, Earlybird, Outlier Ventures, Coinlist, BoostVC...

Signaling by corporate customers / partners
Source: Website, Crpyto News
Comments: E.g. Ethereum & Microsoft Azure, Ripple & R3, Shapeshift & Overstock

Signaling by reputable crypto partnerships
Source: Website, Crpyto News
Comments: Transparent partnerships, e.g. Aragon & 0x, Minebox & Sia.tech, Shapeshift & Exodus


Project progress on code base over time
Source: https://github.com/, https://bitbucket.org/, https://www.coingecko.com/en
Comments: Forks, Watchers, Issues, Closed issues, # new commits, # contributers, # stars

Solid whitepaper
Source: Project Website
Comments: Covering Tech, Team, Roadmap, Token Distribution, Miner incentives, governance. Degree of detail, comprehensiveness, references, depth of thoughts...

MVP / Alpha product testing & reviews
Source: DYI, https://www.producthunt.com/
Comments: Test the product DIY; get early customer feedback

Quality of Code
Source: https://github.com/ (Stars, Comments); https://codeclimate.com/
Comments: External technology due diligence report provided?

Proprietary Core Product
Source: Whitepaper, Github
Comments: Patents, specific technological know how

Tech stack
Source: Project Website, Whitepaper
Comments: Use of decentralized infrastructure (IPFS, Ethereum, BigchainDB/IPDB, 0x, Aragon, Oracles); programming languages in use

Tech Roadmap
Source: Project Website
Comments: Realistic but ambituous; high level directions; too much detail could make the project appear inflexible (problematic at early stage)

[New blockchain protocol]
Source: Whitepaper
Comments: Consensus Algos, Scalability, Governance structures, Openness (private, public, consortium), transaction throughput, block size, state channels, sharding, fees, privacy (zero knowlege proofs, cryptography), degree of decentralization, # products built on top of protocol
Further Reading:
- "On scaling decentralized blockchains: http://bit.ly/2wkW9pA
- Consensus in Blockchain Systems: http://bit.ly/2x9rf0I
- On sharding Blockchains: http://bit.ly/2vbCUuT
- Tezos Position Paper: http://bit.ly/2w03gAZ
- Ethereum Whitepaper: http://bit.ly/2x9YjGe"

Adoption over time
Source: Reporting by core team, https://ethstats.net/
Comments: # Downloads, # active customers, churn rates, cohort analysis, "credible buzz" by open source developers, ...

Market & Competition

Size (TAM, SAM, SOM) & Growth (CAGR)
Source: Gartner, Cbinsigighs, Consultancy Reports (BCG, McK, Deloitte)
Comments: Either big market or massive CAGR over next 5-10 yrs

Value Chain Analysis & Market structure
Source: Research
Comments: Degree of fragmentation; Marketsizes by subcategory; power of intermediaries; price transparency; degree of automation, degree of centralization (the higher the more likely to get disrupted by decentralized networks)

Direct & potential competitors
Source: Pitchbook, Crunchbase, Cbinsights, Quandl
Comments: Other crypto companies in the sector? Incumbents in the sector? Team, Funding, product maturity, 1st mover etc.

Competitive edge
Source: Research
Comments: Network effects; Entry barriers (patents, exclusivity rights, regulation / licenses), Forward / backward looking lock in for customers or community

Go to market strategy
Source: Whitepaper, Website, Research
Comments: Customer target groups, product verticals, geographical market entry, Sales & Marketing Channels, growth hacks, viralities

Business Model & TGE (Token Generating Event)

Business Model & Token Design
Source: Project Website, White paper
Comments: Which kind of token is used (equity, utility)? Is the token an incremental part of the product? Why is a native token required opposed to using BTC, ETH...?
Further Reading:
- A gentle introduction to digital tokens: http://bit.ly/2x9mJzt
- On token value: http://bit.ly/2vV5seE

TGE structure
Source: Whitepaper, Project Website
Comments: transparent pre sale strcuture & terms, value creation on token or (also) on equity level?, Certainty of valuation, Cap, no central banking, future issuing plan (fixed supply, inflation / deflation), incentive structure (early supporters, miners, developers, community), reasonable vesting scheme for core team & pre sale participants, Risk of market manipulation & centralization "whales", broad distribution of tokens (accredited / institutional only - public), maximizing walfare of biggest group
Further Reading:
- Analysing token sale models: http://bit.ly/2vV9dRi
- Optimal Token Sales: http://bit.ly/2vb25xt
- The perfect token sale structure: http://bit.ly/2vlRzTv
- On issuing & supply - the economics of filecoin: http://bit.ly/2wva393
- Aligning incentives in ICOs: http://bit.ly/2vVUYMb
- Toward more equitable token sales strucutres: http://bit.ly/2w0Aosz
- Mining incentives & strategies: http://bit.ly/2g1QrCn

Use of funds & Treasure MGMT
Source: Whitepaper, Project Website
Comments: High level business case, product & tech, go to market, hiring strategy, How will capital be released? Who decides on it?

Trading Infrastrucutre
Source: Whitepaper, Project Website, https://www.cryptocoincharts.info/, https://cryptowat.ch/, https://coinmarketcap.com/currencies/volume/monthly/
Comments: Exchanges listing the token, Hardware wallet support, Software wallet support, Integrations & partnerships with leading ecosystem players. A potentially growing coin needs to be wide spread among exchanges.

TGE process & communication
Source: Whitepaper, Website, https://icomonitor.io/#/
Comments: Transparent Presale, Reasonable time window, peer reviews, Q&A, proactive communication, TGE through smart contract (accessible), tracking data via events, trustless handling of contributions, conditioned start and ending of TGE, crytocurrencies accepted for participation, Focus on cyber security - has a bounty program been set up to detect bugs?
Further Reading:
- https://icomonitor.io/#/
- https://github.com/EthTrader/ico-review/blob/master/criteria.yaml
- https://coinspectator.com

TGE service providers (transparency)
Source: Website
Comments: transparent security audits, legal audits...
Further Reading: Best in class service providers: https://blog.zeppelin.solutions/, http://www.mme.ch/, https://www.bitcoinsuisse.ch/, https://argongroup.com/, https://www.smithandcrown.com/, https://coinfund.io/, www.bravenewcoin.com/

Investor rights
Source: Whitepaper
Comments: Profit (interest, dividend), Voting / Governance / Influence of token holders, Transfer rights, public reporting, Block creation rights, Contribution rights, Access rights
Further Reading: Token rights: Key considerations in crypto economic design: http://bit.ly/2x9wspn

Legal & Regulatory Guidance
Source: Whitepaper, Project Website
Comments: Statement of clear qualification of token for different jurisdictions, details on pending regulatory proceedings, Disclosure of different legal opinions on the qualification of the token, list of countries included / excluded from ICO,
Further Reading: A securities law framework on blockchain tokens ""Howey test"": http://bit.ly/2wveMYh
EU blockchain policy initiative report http://bit.ly/2imuy1k

Network Valuation & Asset Pricing

[1. Historical Risk-Reward Profile]

Sharpe Ratio
Comments: "Excess returns devided by risk.
Formula: (ARR crypto asset - ARR risk free asset) / Standard Deviation
Standard Deviation = volatility.
The higher the number the better. "
Further Reading:
- Understanding the Sharpe Ratio: http://bit.ly/2voFz3u
- Is bitcoin the undisputed best performing asset class of the decade? http://bit.ly/2ipYR7t

Volatility over time (monthly / yearly)
Source: http://coincap.io/
Comments: price levels benchmarked against ICO, upward price trend on quarterly base. Decreasing volatility indicates a maturation of the asset.

Price independence
Source: https://coinmarketcap.com/
Comments: Correlation with other assets (S&P 500, Bonds, Gold, Real Estate, Oil, emerging markets currencies) and specific other crypto tokens (e.g. Litecoin, BCH vs. BTC or ETC, NEO vs. ETH)
Further Reading: What is correlation? http://bit.ly/2wDZXBU

Total transaction volume over time ("Investability")
Source: https://coinmarketcap.com/currencies/volume/monthly/
Comments: Outlier months, Reasons for outliers, Upward Trend, % of total market trading volume. The higher the trading volumes the less votalite the asset gets.
Further Reading: Bitcoin: Ringing the bell for a new asset class: http://bit.ly/2ipUVDt

Global trade volumes by different fiat currencies
Source: https://www.cryptocompare.com/coins
Comments: Sucessful coins are traded globally. Trade volumes in many different fiat currancies are an indicator for increasing maturity and decreasing volatility (= risk)

Market Cap over time
Source: http://coincap.io/
Comments: "includes utility value + speculative value
utility value is likely to be the bottom in correction phases"

[2. Current utility value]

Crypto "P/E ratio"
Source: Price / "Earnings" = price / utility value. Utility value = non-trading, non speculative value. The smaller the number, the better.
Comments: Answer to: Is the asset over- or underprized (NOW)
Further Reading: What is P/E ratio: http://bit.ly/2intvhN

Current market shares & revenues (if applicable)
Source: Team reportings
Comments: No standard valuation methods in crypto. Different valuation methods for equity (revenue multiples, heavily depending on phase & business model.

Network Maturity over time
Source: "https://live.blockcypher.com/
https://etherscan.io/, https://ethstats.net/"
Comments: Total # network particpants, # nodes, Mining Power, Hash Rates, # nodes, location & distribution of nodes

"utility" transaction volume over time (monthly) "
Source: https://www.cryptocoincharts.info/
Comments: Total transaction volume from public ledger MINUS speculative exchange transaction volume. Tough to figure out.
Further Reading:
- What are cryptoassets actually worth (Chris Burnisk) http://bit.ly/2vYAxfI
- Book, Cryptoassets: the innovative investors guide: http://amzn.to/2wBM2MN

[3. Potential future network value]

Revenues & market share in the future
Source: Research, top down future market sizing
Comments: e.g. BTC: 10% of global remittance markets // Sia, Filecoin, StorJ: 10% of total petabite storage x price per GB + DNS layers.

Token Supply trajectory
Source: Whitepaper
Comments: Will the asset be scarce? How does the future supply look like?

Upside potential, ARR over time
Source: Assumptions & Calculations
Comments: Which revenues / market share at which point in time. Business Case logic. Difference between current market cap and potential future utility value. The bigger the difference, the bigger a potential return.