This is a series of guides for crypto newbies, with a focus on investing in Australia, although a lot of the advice will be suitable for a global audience. This is a guide from the point of view of people new to the space, without in depth knowledge of blockchain, defi etc.. and so will seem very basic to seasoned crypto investors but there seems to be little simple information available to those just starting out.
Part 3 : BTC / ETH and Alts
Bitcoin (BTC) is the obvious choice for first investments, its currently at an all time high (ATH) price, so caution is needed as likely to crash but no-one knows when and how far. Large institutional investments mean it’s likely to hold value more than previously (1.5 billion dollars of BTC bought by Tesla a few months ago), but could still crash hard. However it could also go from current approx $75k to $200k before crashing 50% to $100K in which case buying now would still be a bargain, but could also drop to $40k/30/20/10k? Personally I think a drop that severe is unlikely but nothing is impossible.
Ethereum (ETH) is the second biggest crypto by market cap (number of coins available x price per coin), main down side is large fees (gas fees) for transferring or making transactions, especially when transferring smaller amounts, the fee can be larger than the transfer amount. They are trying to fix this and when they do it may cause the price to surge so buying some and keeping it on an exchange to avoid gas fees transferring to a wallet may be worthwhile as long as you are happy with the risk of the exchange being compromised.
It’s been suggested that a ratio of 70% BTC and 20 – 30% ETH with 0 – 10% alt coins or shitcoins (anything that’s not BTC or ETH) gives the best overall portfolio performance historically. Shitcoins are a much bigger gamble generally as they may pump many 1000% in a short space of time, or they may go bust/crash and lose everything.
You can also stake or delegate some coins through different wallets or exchanges, which is basically lending it out for interest, some of these come with risk, some don’t and have varying rates of interest.
A few thoughts on some shitcoins:
Cardano (ADA) sold by some as a successor to ETH, hasn’t quite got there in terms of useful applications but a lot of potential, currently close to ATH so may have a dip incoming
Binance Coin (BNB) used by BINANCE to run some of their operations, you get a discount on trading fees I believe if you hold this coin on their exchange
VeChain (VET) Lots of applications and real world uses, lots of potential but like most alts has already pumped recently and close to ATH
Chiliz (CHZ) sells fan tokens to give people voting rights for sports clubs, has pumped and dropped back a bit but good long term potential unless another coin offers better functionality and supercedes it
Dogecoin (DOGE) out of control meme, no real long term value as supply is unlimited but keeps being pumped by Elon Musk so may jump intermittently in price, has had great performance in last 12 months.
Harmony (ONE) another with great potential for various applications, can be staked for currently around 12% return (in ONE tokens), minimum 1000 ONE needed to stake (worth around $200 depending on current price). Use free phone app wallet Blits for for easy staking.
Disclaimer:
Any links in my posts are referral where possible so if you sign up and use the site via those links I get something, or we both get something out of it, if there is no referral link available it’s just a straight link to the site. I really appreciate anyone using referral links as it supports covering my time writing these articles. None of my opinions or recommendations are based on whether a referral link is available and I have received no other incentive to write any of these articles, they are a true representative of my own experiences, good and bad.
All pictures/photos used are taken or created by me, and are copyright. Please contact me for purchase or licensing.
