Inspired by @sebhezlo's question "What is your crypto mining strategy currently?"
I want to share an experiment I'm conducting called "How to Moon 1 #BTC Without Buying #Bitcoin!"
I'll explain the strategy behind it and explore its potential.
Lets Dive🧵
cryptocompare.com/portfolio-public/?id=617923&user-id=2324014
With the #crypto market's ups and downs, it's essential to have a clear strategy and explore alternative paths to increase your #BTC holdings. Instead of buying #Bitcoin directly, I set out on a mission to leverage altcoins and demonstrate their potential for exponential growth.
Inspired by the experiment conducted by @GuntisVitolins in 2020, I decided to replicate the strategy. With #Bitcoin priced at $31k, I took one #Btc from my holdings and divided it equally (0.1 BTC) among 10 altcoins.
Why? Let's explore the reasons.
In bear markets, it's crucial to explore the potential of investing in "decent" altcoins. These altcoins often have promising fundamentals and innovative technologies, yet their prices might not have fully reflected their potential.
The goal of this portfolio is to demonstrate that investing in diversified altcoins during bear markets and converting them back to #Bitcoin during bull markets can potentially yield higher returns compared to a direct investment in #BTC alone. But why is this strategy important?
Volatile markets can be unpredictable, with sudden price fluctuations across various cryptocurrencies. By diversifying your investments, you spread the risk and increase the potential for finding hidden gems that outperform the overall market trends.
However, sticking to a clear strategy is essential. It helps to mitigate impulsive decisions and emotional reactions to market fluctuations. A well-defined plan helps you stay focused and disciplined, even in the face of uncertainty.
From my experience, a diversified altcoin portfolio can provide exposure to different sectors, such as DeFi, NFTs, AI and emerging technologies. It allows you to capture growth opportunities in specific niches, which may outperform during certain market cycles.
I aimed to diversify following 2 key rules.
First, I avoided coins in the top 50 cryptos to provide room for potential price growth and climbing up the crypto ladder.
Second, I divided my investments between Proof-of-Work (PoW) and Proof-of-Stake (PoS) coins, while also considering different sectors.
Let's explore my strategy further!
• L1 currency: Foundational cryptocurrencies with potential to establish themselves as primary digital currencies.
like #ERGO, #RTM , #KDA
• DeFi: Altcoins focus and has decentralized finance ecosystem, aiming to revolutionize traditional financial systems. #KDA, #STX, #SUI
• Infrastructure: Coins focused on providing blockchain infrastructure, enabling decentralized applications and networks.
like #DATA , #Verus, #PRE, #FLUX
• AI: Altcoins at the intersection of artificial intelligence and blockchain technology, harnessing the power of both fields for innovative solutions.
like #Ocean , #FLUX , #SUI
By diversifying across sectors, I aimed to capture potential growth opportunities in different areas of the crypto market. This approach helps mitigate risk and increase the potential for long-term success
While the top altcoins provide stability and recognition, venturing into those just outside the top 50 offers exciting growth potential. These coins may still be undervalued, providing an opportunity to ride the wave of their ascent.
incorporating a mix of PoW and PoS coins, I sought to balance the advantages of both consensus mechanisms. PoW coins often provide security and proven track records, while PoS coins offer efficiency and staking rewards. This blend diversifies risk and optimizes potential rewards.
Remember, this thread is not financial advice but a demonstration of the principle and strategy behind the experiment. It's crucial to conduct thorough research, understand the fundamentals of each altcoin, and assess their potential for long-term growth. Knowledge is power!
You can read the unrolled version of this thread here: typefully.com/Bokiko_io/5IFaPwo