Cryptocurrencies have become the favorite investment of people nowadays.
Thousands of investors are rushing to invest in crypto to make millions. Simultaneously, companies and businesses are embracing crypto in leaps and bounds as a form of payment.
Bitcoin, being the pioneer, is the most-accepted cryptocurrency globally. It has a market cap of around 2 trillion dollars.
This dominance makes it an attractive option for investors to put their money into.
Carl Runefelt is a global crypto leader and investor who has poured money into more than 360 crypto startups. He is a strong proponent of Bitcoin and predicts that it will eventually replace fiat currency.
While speaking on his YouTube channel, The Moon, he says, “Bitcoin now is accepted in more countries than gold as legal tender, which means that Bitcoin is now more useful than gold which has been the form of money in the world for many years. Bitcoin is genuinely game-changing, and it represents a massive transformation for the global economy and, indeed, the whole globe. It represents a paradigm change.”
Should You Only Invest in Bitcoin?
Having said that, should you then only invest in Bitcoin?
Undoubtedly, it offers lucrative returns but there are a bunch of other crypto categories that you should wet your feet into.
Some stablecoins and altcoins are readily gaining ground owing to their unique capabilities. These are the digital currencies that you should consider investing in.
Carl Runefelt commented in an interview, “We have seen altcoins rally very, very strongly in the last few months. I think we will continue to see that. I think the likely scenario is that we will continue to see altcoins rise before Bitcoin peaks. I stick to altcoin projects that I believe in and are backed by strong projects.”
Along with altcoins, you should also invest in stablecoins – these are virtual currencies that are pegged against a stable fiat currency, mostly USD.
This is what we call diversification of crypto portfolio
What is Crypto Portfolio?
Simply put, your crypto portfolio is your basket of digital currencies that you have invested in.
You invest in more than one cryptocurrency to minimize your risk of losing money. The risk is often high due to massive volatility in the crypto market.
This doesn’t mean that you should invest in numerous cryptocurrencies out there. There are over 11000 of them actually but only the top 5 of them make up 76 percent of the value of all cryptocurrencies.
Carl Runefelt adds, “I would also say that, of course, you can diversify into other coins as well. Personally, I have bought a bunch of other coins that I hold in my portfolio, and I think some diversification is fine, but in the bear market and even in the bull market, I always think that you should have the vast majority of your crypto portfolio.”
Ways You Can Manage Your Portfolio
They hope for the best but prepare for the best. Diversifying your crypto portfolio is an ideal way of following this adage.
There are a bunch of intimidating, innovative technologies of crypto you can invest in but it is highly recommended to do thorough research and analysis before jumping headfirst into the water.
Here are some of the ways:
A major portion of our population includes job goers! This is an excellent crypto investment strategy for them.
They do not have a large stack of money that can push into crypto. Instead, they can invest a small number of dollars into crypto every single month.
In this way, the dollar-cost averaging method means investing a fixed amount of dollar investment regardless of the chosen crypto price.
Utilize crypto portfolio tracker:
So cryptocurrencies are all about decentralization. You can deal with multiple crypto wallets, exchanges, and platforms at the same time.
What this means is that it will become cumbersome for you to manage all your cryptocurrencies across numerous platforms, wallets, and exchanges.
A crypto portfolio solves this problem for you; It is software that reads your wallets’ data and displays the aggregate information into a dashboard for you.
This is one of the best pieces of advice that we can give you: Keep your emotions in check!
Crypto prices are fraught with wild swings of volatility and this technology is relatively new and can be unpredictable at times.
This means that you shouldn’t let your emotions carry you away with all the hype and crypto craze.
Interestingly, fear of missing out (FOMO) is a genuine condition that compels traders to buy assets at high prices – compulsive buying! You should be rational and patient about your goals. You’ll always get a good investment opportunity to grow your portfolio; don’t rush into making decisions.