The cryptocurrency market has not been favorable to investors lately. Since October last year, cryptocurrency prices fell and continue to trade in an up and down movement.
So, it is hard to find many standout cryptocurrencies. Sure, a few unknown cryptocurrencies jump up 100% or more but those prices won’t last long.
As for me, I have sold a lot of altcoins and moved the losses into Ethereum. Long term, this cryptocurrency will be here tomorrow, next month, and a year from now. Some altcoins may not be here. So if you are betting on one of them, you are taking a bigger risk.
There are a few other reasons why I sold the altcoins.
Hard to track every single cryptocurrency
Unless you have a team or plenty of time, it can be hard to track dozens of cryptocurrencies.
So there may be an instance when an altcoin goes up 50% or more. It’s also unlikely the altcoin will maintain that gain. So, you could sell and make a small profit.
But if you missed that gain, then you lost out on taking that profit.
If you have fewer cryptocurrencies to watch, then you should be able to have a better idea on what altcoin rose, and then you have time to sell or hold on.
Buying Altcoins is like gambling
When you speculate on an altcoin, you are literally gambling and hoping that the altcoin gives you a 100% return.
You may as well go play the weekly lottery or gamble some of your money in Las Vegas.
Suire, some altcoins will do well. But there are 19,098 cryptocurrencies on CoinMarket Cap. To me, that is crazy. There is no need to have that many cryptocurrencies.
So, when you speculate on one or a few, that is like gambling your money and hoping to see a monstrous return.
Then this brings me to my last reasoning.
Some major players HODL Ethereum
This cryptocurrency has a lot of use cases and heavily involved in the market.
Ethereum is one cryptocurrency used to buy NFTs, and create decentralized applications. So, it has become a favorite of many investors.
The twins who sued Mark Zuckerberg of Facebook, Tyler and Cameron Winklevoss were early Bitcoin investors to become Bitcoin billionaires. They also own Ethereum and are considered Ethereum Whales.
Another billionaire is a fan of Ethereum. Dallas Mavericks owner and Shark Tank star, Mark Cuban, is another Ethereum investor.
Cuban told Forbes, “I'm very bullish” on Ethereum.
Then the new owner of Twitter, Elon Musk, is an Ethereum holder. This was one of three cryptocurrencies that he owns. The other two are Bitcoin and Dogecoin.
A 4th bonus
In a recent article by Arthur Hayes, he mentioned that if Bitcoin dropped below $30,000, he was planning to sell most of his altcoins.
“If I believe that Bitcoin could trade below $30,000 and Ether below $2,000 in a three-to-six month time horizon, I will dump all of my shitcoins.”
Then he would hold on to Bitcoin, Ethereum, and a few other altcoins that he liked to ride out the storm.
Hayes hasn’t released his current holdings, but that gave me the idea that it is better to hold onto long-term winners in this market. The cryptocurrency market has changed and is affected by external forces just as inflation and moves by the government affect you and me.
People make decisions based on these moves that affect their cryptocurrency investment.
You need a plan when you buy cryptocurrencies. If you don’t have a plan, then it is too easy for you to make a bad decision or you might sell to early or too late.
The market moves very fast so having your own plan will help you through the good times as well as the bad times. The plan will help you become rich and avoid losing assets you acquired.
If the market remains like it is, I would rather hold the majority of my assets in Ethereum over a plethora of altcoins. It is too easy for an exchange to delist some of these cryptocurrencies which has happened to me before.
This is something that will be hard for you to move the cryptocurrencies if they do delist them. You may have time to move them, but their value also decreases.
Holding onto Ethereum seems like a better move for me.
What do you think?
This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any significant financial decisions.