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To ensure the validity of a project (Defi), should consider the questions and the answers they’re looking for. These questions are about the purpose of the project, open-source code, technical reviews, team members’ backgrounds, and the project’s token economy. In the first part of the article, we will address these questions and finally mention the features of scam projects.

Many Diffie projects have nothing to say. To check if a particular innovation has been created by the project. A credible project must have extraordinary features and capabilities. Those are capabilities that solve users’ problems and have a positive impact on the industry currency encryption and Defi. Also, carefully examine the value of the project and its local currency code.

But if the goals and promises of a project do not seem logical at all or are too ambitious, it is probably a hoax. Most of the projects that claim to be the biggest and most important part of Difai in the future do not achieve their ridiculous goals.

Is the project source code available to the public?

Any project that has open-source source code is considered somewhat valid. This also applies to Diffie projects. Good projects usually make their code available so that it can be viewed and reviewed.

Also, project developers need to update the code regularly and on schedule. In this way, it can be understood that the company in question is interested in its project or that it only intends large and quick profits.

Has the validity of the Defi project been reviewed?

When a project is thoroughly inspected, its code security is determined. Code security is also the most important criterion in determining the validity and accuracy of a project. The technical review process is very costly for the project. So when the project pays for it, it probably has no scam.

Of course, when a project did label “audited”, make sure an official source has issued the certificate.

Technical review of smart contracts to determine the validity of Difai

In this type of review, the codes of a smart contract are evaluated and challenged in different ways. In this way, criteria such as technical strength, operational efficiency, security risks, and its best applications are determined. The review company ensures that the project is not risky for investors and has complete security to maintain their assets.

If the smart contracts of the project in question didn’t consider, it is better to look for other projects.

Are the project team members know?

Let us clarify an issue; “The number of likes and followers in cyberspace is not equal to the credibility and competence of a project!”. So when analyzing a Defi project, check the developers very carefully. See if these people have already designed a successful platform. Also consider their work, scientific, and investment experience.

If the team members of a project are not very popular and you have not heard their names, there is no guarantee that their platform will be optimal and efficient.

What about the project token economy?

Carefully review the project roadmap and learn how to inject tokens into the market cycle. Scam teams usually try to push up the project token price sharply. They then inject large volumes of tokens into the market.

In addition, check the liquidity plan of the platform in question. The project that deprives people of their locked assets should be doubted. schedule initial release Also checks the project. See if the news of the sale of tokens has been publicly published by them in cyberspace or not. Tokens may also be via AirDrop distributed. The problem with airdrops is that they increase sales pressure.

Check the validity of Defi; Features of scam projects

Here are the features of scam projects. If the project has such features, get rid of them immediately!

The promise of a high return on Defi Invesments 

If you think the percentage of return on investment announced by the project is very provocative and irrational, do not go for it. Because there may be a scam or a Ponzi scheme. Experience has shown that great promises lead to the loss of wealth.

Poor white paper or lack thereof

If you want to make sure you are dealing with a credible project, check out WhitePaper. This document should include items such as project philosophy, main objectives, and solutions. The project team must also fully explain how to achieve the goals in White Paper.

Lack of proper response

A credible defy project does not prevent users from asking related questions. Although developers are not responsible for answering all FUD questions, they should not censor them in any way.

Emphasis on attracting a lot of capital

A small project must understand that liquidity can absorb over time and must satisfy with small amounts of initial capital. Scam projects usually place a lot of emphasis on raising high capital. While they have not yet been able to prove their effectiveness and benefits.

Spend a lot on advertising and marketing

Low-budget projects usually try to reach an audience through intense advertising and marketing. Of course, advertising about Quinn’s initial release does not fall into this category.

The low number of holders and token listing only in decentralized exchanges

through an explorer Check the number of project token holders blockchain. See also famous token in exchange for trade or not.

Summary Defi validation

As you can see in this article, a diff project is consider from several sections and all the details should take seriously. By following these brief (but important!) Tips, you can protect your property against fraudsters. Since the cryptocurrency space and the DIFA ecosystem are not very much under the control of governments and legislators, it will be entirely up to you to ensure the credibility of the relevant projects.

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