I'd say it's safe to assume at this point that crypto is here to stay, barring any intervention from big brother. Just this past year, the collective public consciousness has shifted to valuing Bitcoin as a legit bonafide asset.
The top 1% of wealth in the U.S. and around the world have driven that point home with the likes of Grayscale and Tesla pouring billions into the market - much to the chagrin of the 99%. Many of us "bottom-feeders" have experienced life changing gains in their virtual currency portfolios, sparking a glimmer of hope that just maybe we can break the chains of financial bondage and oppression.
Like seriously? Traditional retail stock investing is of no use to us my brothers and sisters. Just ask /rWallstreetbets. The uber wealthy rigged the game to a point we were forced to leave and build our own. Now institutional investors have swallowed up large swathes of liquidity in BTC, ETH, and others like warm apple pie and vanilla ice-cream - they just can't get enough. Now, to be fair, the fact that the current bull market we're in is so explosive is partly due to mammoth investors entering the market.
Bitcoin and Ethereum liquid supply continues to trend toward all-time lows, and FOMO is building in many people's minds. Casual followers of crypto continue to fall into the trap of buying BTC at a premium our of ignorance, and the sharks can smell blood in the water. Sometimes it's good to take a step back and realize that crypto is still in its infancy. There's a long way to go, and plenty of Benjamins to go around.
Back when I initially began investing in crypto I'd push all my chips into the table on one coin, and panic all day like a schizoid with my eyes glued to Trading View. I'd lament every drop in price like it was the end of the world, and celebrate each momentous run like I had made millions (I hadn't). I had pinned all of my investment, with zero risk management in mind, first to BTC and then Ethereum for a while. I was impatient and wanted to see gains instantaneously - the opposite of how intelligent investors carry themselves.
Through trial and error, and a lot of money lost, I've found that diversifying my portfolio with carefully researched altcoins. Altcoins that are well suited to the amount of money I can invest. I try to stick with altcoins in which I can afford to purchase the entirety (1.0) of the coin several times over. The problem with investing $1,000 into Bitcoin, or even Ethereum at this point, is your ROI multiple is atrocious.
For example, let's say you invested $1000 at $47,000/BTC, which works out to ~.021/BTC. Having .021 of anything is going to have a hard time find a way to grow exponentially. Say BTC rose in price to $60,000. That $1,000 you invested is now worth $1,260. Meanwhile, the guy who owns .5/BTC went from $23,500 to $30,000. That's an increase in value of $6,500.
I've created a rule for myself where I don't invest in any altcoins more than $30/coin. This allows me to really spread out my investments and really leverage that exponential multiplier. Here's a snapshot of one of my crypto wallets, Exodus.
As you can see, Cardano's been fantastic for me in 2021, and has incredibly become the 3rd largest crypto by marketcap (I don't count stablecoins). Chainlink is an uber-safe and stable crypto that I use as a hedge against some of the more volatile ones. Finally, Polkadot and ATOM round out the rest of this specific portfolio.
In case you didn't notice, there's a theme. ADA, DOT, and ATOM are all competitors to Ethereum, with ADA and DOT having direct ties as co-founders. I will leave it at that. Do your own research.
The magical runs of virtually every altcoin (just throw a dart at the top 100 coins) have almost been a reconciliation prize for all the shittiness of 2020. However, the importance of fundamentals and technical analysis remain unchanged. You still have to do your research and gauge the overall sentiment on social media - know the project inside and out before anything else.
My parting words are as follows:
It's difficult building a balanced, healthy portfolio if you try to invest solely in Bitcoin and Ethereum. They're too developed as crypto assets to profit without having millions in the bank to spend. Alas, do not fear my brothers and sisters, for the bull market has just begun and I promise you BTC and ETH will not be the only coins that make a splash in 2021. Savvy traders know this. Let the media play up Bitcoin and ETH and watch the clueless little minnows splash about.
