Depends on the Breadth and Depth of the Community Supporting it
Five components of Engagement:
- Developer Adoption of Protocol
- Active commenting Reddit
- Long lasting ongoing discussions in Slack, Telegram, Discord, etc…
- Positive Twitter Sentiment
- Uptrend in Google trends
This will be quick. Toss a couple of dollars to Earn.com users and an engaged community will show up on your doorstep. My Telegram demonstrates this.
Not really though and this demonstrates a pitfall of evaluating engagement. It’s not how many, it’s how much.
Starting in the open with a niche community of early adopters who have a strong belief about something tends to be a good foundation for a cryptoasset.
10,000 bros in a chat channel repeatedly posting To the Moon and HODL with exclamation points and rocket ship emoji. Depth is much more important than breadth.
When evaluating engagement you are doing a qualitative analysis of a project’s progress in inducing network effects. Having a few deeply engaged users is more likely to induce network effects than lots of looky-loos who’ve joined a chat room but don’t actively participate.
To get a feel for engagement you’ll need to spend time searching public forums, subreddits, official developer Telegrams etc… To assess what the discourse is like.
- Is discussion price focused or project discussion?
- Is active commenting going on in its Sub-Reddit and other social channels?
- Are the comments insightful?
Can’t find a Sub-Reddit, big red flag, as this indicates there is not a robust community supporting the project.
A community of hundreds on Reddit actively discussing the particulars of a project is a better sign of value than 10,000 cheerleaders calling for a higher price.
Evaluate daily engagement across Telegram, Slack, Discord, etc… Daily engagement is important because many cryptoasset projects engage in efforts both paid and unpaid to boost their numbers on these platforms.
A surge of people joins their Slack or Telegram channels during these hype cycles. Once the hype fades people lose interest in participating because there is nothing to back up the hype. A quality community on these apps will have robust daily engagement which is more important than the raw number of subscribers if there is minimal activity.
I like to use Google Trends as a proxy for news. When people are interested in a topic the news follows so an uptrend on Google Trend indicates a project that should continue to have visibility moving forward. Trends fluctuate with spikes during releases or product announcements and naturally decline afterward. So you’ll want to look for rebounds from these declines, demonstrating an ability to maintain a certain level of attention with the public on an ongoing basis.
For Twitter, I focus on mentions as opposed to followers. You can start following a project easily. Tweeting about a project demonstrates engagement versus mere interest to me. I like projects with over 10,000 mentions monthly. This needs to be scaled based on project size though. It will be challenging for projects to meet this threshold early on.
Now, these mentions could be slamming a project. So I take the additional step of evaluating sentiment to determine whether the mentions are positive or negative.
A good tool for measuring sentiment is Solume. Numbers do need to be taken with a grain of salt as sentiment almost always trends positive. If it would trend negative this is a strong indicator the project has run into some trouble.
Developer Adoption of Protocol
- Code Added
Stars indicate developer’s interest in tracking the project’s progress. Watchers are interested enough they want to receive notifications regarding project activity. Commits indicate revisions to the project’s codebase.
Higher activity among these metrics along with code consistently being added indicates developer interest in the project.
Another helpful resource for evaluating developer adoption of a protocol is CoinGecko’s developer score. Coingecko combines the various dimension of Github activity into a total score on the scale of a 100.
Coingecko also has a community score that can provide some context for engagement. I do not rely on it heavily though as engagement is relatively nuanced and I think should be evaluated granularly if possible.
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