I’ve been writing quarterly reports for friends and family that are getting into cryptocurrency investments for the past year.
I find that people often know what to do, they just need a helping hand to let them know that their plan is valid. I’m not a financial advisor, if anything I’m a degenerate trader with an addiction to charting and HODL memes.
My hope in sharing this isn’t too sway your opinion or convince you to buy into coins you’ve never heard of.
My hope is that through reading this, you will start to understand the benefits of developing your own investing strategy.
If you’re investing without a strategy, you’re throwing money away.
“Failure to plan is planning to fail”, after all.
As we make our way through the second month of 2018, I want to share some of the cryptocurrencies I’m focusing on for Q1.
I split coins into 3 tiers. Coins in tiers 1 & 2 I will be continuously adding to my positions throughout Q1.
I base these tiers on my investment strategy, I highly suggest creating a strategy before investing in anything.
You need to have a goal that you’re working towards, and a framework for how you want to reach that goal.
My goal is to increase my holdings of Tier 1 & 2 coins, by trading coins from tier 3 on a short-medium time frame (2–6 months).
I also margin trade Tier 1 & 2 coins and use profits to increase my overall $BTC position.
By the way, don’t margin trade.
It’s bad.
Not margin trading is rule #8 in my “10 Crypto Commandments”.
It’s also a perfect example of why the I use the quote, “Do as I say, not as I do”, so often. The stories I tell you reflect what I’ve learned from my own shortcomings. I margin trade like an addict — it has brought some of my biggest wins — but its also brought the largest losses I’ve ever experienced.
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Some of these coins I don’t believe in as long term investments.
Most of the time, the criteria I use to pick coins starts fundamentally with the team, roadmap, and community.
Once I’ve deemed a coin as “Fundamentally Strong”, I then go into the charts and apply Technical Analysis to determine if I can get a solid entry point.
Sometimes, I’ll see a coin I don’t think will last in the long run, but the chart is just too pretty to say no. I will denote these coins with an [X] by their name.
Cliche Disclaimer: none of this is financial advice, don’t even listen to me, I’m a random person on the internet — I could be full of sh*t and you wouldn’t know it.
Do your own research and only ever invest what you can afford to lose.
Tier 1
Bitcoin ($BTC)
I always hold at least a little BTC. Bitcoin is the market leader, and until that changes, I will always hedge against my Altcoin investments with Bitcoin. I typically have any where from 10–30% of my portfolio in Bitcoin depending on Bitcoin dominance at that time.
Bitcoin dominance refers to the percentage of the total cryptocurrency market share which is held by Bitcoin. You can check the live stat here.
The link also shows the market dominance of the other major coins on the market- spend some time getting to know the chart and notice how coins market caps correlate negatively or positively with each other.
Understanding the market cycles of crypto is pivotal to successful investing.
Tier 2
Neo ($NEO) & Ethereum ($ETH)
Image courtesy of CoinSutra
ETH and NEO are competitors. They solve the same problems, are both serious coins with large market caps, and I hold both as long term investments.
I’m not hedging against my bets by investing in competitors. It’s feasible to me that these two entities could co-exist in the future in a fashion similar to how Apple and Samsung coexist.
Update — May 11, 2018:
Since publishing this, I have started accumulating large amounts of EOS whenever it dips. I’d not consider this a Tier 1 investment, and have started moving some of my NEO holdings into EOS.
I should have updated this a long time ago, but EOS and ZCL have been my best trade of the quarter (and honestly I’m a little surprised). I’m extremely bullish on EOS, while the founders may be polarizing, they have way too much financial support coming in from different hedge funds/VC firms who want to use the EOS platform to release projects they’re funding.
Tier 2a
aXpire ($AXP)
Company is partners with Microsoft and R3, and already has an API version of the software in live use with a client. Team comes from relevant background, and have shared the bulk of the tokens with the community, reducing risk of a flood of sell orders. Company currently produces revenue, and closed full sale and pre-sale in 48 hours, each.
Ethereum Classic ($ETC)
Image courtesy of CryptoCompare
Ethereum Classic is a fork of Ethereum. In my opinion, it’s a great long term hold. It’s been around for a long time and is one of the safer cryptocurrencies to invest in.
EOS ($EOS)
Coin Type: Platform, ETH competitor
I’m confident it will double from current price in medium time frame.
Since I began writing this, I learned that RobinHood is going to be adding QTUM to the list of coins that can be monitored from its platform (not traded). Although it won’t be tradable when RobinHood launches its crypto trading, the fact that it’s on the watchlist makes QTUM much more appealing to me. It’s a competitor to EOS but keep your eye on it.
**See update in Tier 1 regarding my change in stance on EOS**
OmiseGo ($OMG)
Has maintained its value decently during the current correction, when that market picks up again I see OMG hitting new highs, possibly around $60.
Golem ($GNT)
Great team, fundamentally strong as hell. Will be holding this for a long time.
TRON ($TRX)
Great price, a lot of negative rumors have tanked the price lately but this is gonna be one of my long term holds- several developers from Ali Baba recently joined the team and Justin Sun is becoming too well known for Chinese government not to support him- they want their nationals to look good.
Cindicator ($CND)
Market indicator analyzing sentiment and other factors, all of its calls have brought huge % gains for its users so far and is picking up more and more steam.
Civic ($CVC)
This is one of the few coins out there that I believe is using blockchain to create solutions that can positively affect a large amount of people. Civic allows people to secure their identity with distributed ledger technology. Adoption (as always) will be the hardest part of the journey, but judging by the team and what they’ve done so far I’m bullish.
I also like that this is a B2B coin- B2B Blockchain projects are extremely interesting to me at the moment.
0x ($ZRX)
Recently added to Bitfinex, the market correction we’re seeing hasn’t allowed it to flourish from the new volume it can potentially see from Bitfinex users.
Their team is also amazing. I actually put this in Tier 3 when I started writing this, but after doing more research into the coin decided to move it up!
ChainLink ($LINK)
This is my sleeper bag. I think this is going to EXPLODE when the team starts doing a better job at marketing/PR. Sitting around 40–50 cents last time I checked, this is another one that I load up on every time the market dips. project incubator that was born at Disney. I’m extremely bullish on any project that is tied to an already existing and successful company.
Tier 3
Verge ($XVG) [X]
I consider this a “shitcoin” but see some short term potential for quick profits.
Update, May 11, 2018: Got out of Verge after the PornHub news was released for some nice profits, I’m not longer very bullish on Verge. I think they have a lot of potential to turn their sh*t around and become a serious contender in the privacy coin space, however, they have lots of work to do.
The one redeeming factor for Verge in my eyes, is that whether or not the PornHub deal was merely a PR stunt, it’s the largest potential use case I’ve seen out of the cryptoasset in general, and I have a hard time not tipping my hat to them for executing that.
Bonus Round
Recently, a few exchanges have launched that are in themselves- decentralized platforms ran with cryptocurrency. I’m fascinated with these coins because they grow in value as the exchange acquires new users, so there is a direct correlation between actual success in business and price increase. Coins too look out for in this sector are:
$BNB & $KCS.
What are your favorite picks for 2018? Please feel free to comment any projects that have piqued your interest this year!
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None of this is financial advice, just letting you guys know what’s working for me.