Cryptocurrencies

Crypto Shopping Cart – Altcoin shopping – a real example

It’s been SO LONG since my last “Crypto Shopping Cart” post!

I was EXTREMELY fortunate last week! An elderly family member stated out of the blue that she was going to send me a gift. I found myself on the receiving end of rather a large sum of money (at least by my standards), for absolutely no reason other than that she felt like giving it to me. Reflecting on it, the value of this spontaneous gift is several orders of magnitude larger than ANY gift I have ever received before!

I’m not at all religious, but I do firmly believe in God (or whichever other name you wish to use) – it seems that my approach has its benefits…

Surprise and gratefulness aside, I realised that I must put this money to good use, hence today’s post.

[Editing update: this post has now taken four days to write. My thanks to my electricity provider for continually letting me down.]

DISCLAIMER:
If you have read my posts before, you may remember that I have stated “do as I say, not as I do” when it comes to crypto. My circumstances are not your circumstances. Specifically: my circumstances necessitate the taking of financial risks considerably larger than what I would choose under better circumstances. Please bear that in mind as you read the rest of this post…

… though having said that, I am also shocked at how completely blind and oblivious the world seems to the money printers currently going BRRRR!!!!!! 24/7. Share prices are high. Derivatives are doing well. Risky Forex markets are starting to boom. And they have the nerve to call crypto risky…

With that said, I can now inform you that I have decided to put half of my newly acquired funds into crypto.

When and How?

That’s the million dollar question. Experience has taught me that there is no time like the present. I have missed numerous good buying opportunities trying to time the market in the past. The gains I have made by waiting for the right time to buy are far outweighed by the losses. That should come as no surprise: the market generally trends upwards – in general, prices today are statistically likely to be cheaper than prices tomorrow, next week or next month.

In addition to that, Bitcoin is still riding along my long-term base trendline, indicating that the market is hype-free and that prices are low. Yes, the price of BTC DID dip severely a few months ago, but that was a breakdown of the entire global financial market. That makes things tricky…

Though I would rather buy now than wait, I fully expect the market to dip again. For that reason, I am using split strategies: I have already spent half of my allocated crypto funds on an immediate BTC buy. The rest I aim to use in my own particular DCA/Value Averaging hybrid strategy over the next five months, at a rate of one buy per month. If the market does take another sizeable dip during that time, I will buy that dip with whatever funds I have left at the time – though probably in a staggered fashion to avoid buying too early.

What about the altcoins?

That’s the million dollar question’s baby brother. Experience has taught me something else: altcoins do well when there is hype in the market. While BTC is back up to about half of its ATH, many of my altcoins have only recovered about 5% of their value, some even less than that. Altcoins are inherently riskier than BTC, and the smaller the coin, the riskier it is (generally speaking).

So in times of economic uncertainty, it would be silly to pour money into altcoins, especially small market cap ones. So what I have done now is to use the performance of particular altcoins since early 2018 as a barometer of their possible future success. I have previously stated that I have no real interest in most newcomer altcoins, a fact which I stick to, because they have yet to prove themselves. Old altcoins have survived a chronic crypto winter, the worst ever, and yet they still exist. Be careful, many rubbish tokens still exist too, even though the projects behind them are essentially dead. But many other projects have shown that they have the dedication and business sense necessary to survive in a very harsh environment. Like steel tempered by the furnace, they have emerged harder and stronger than before.

So while I shy away from altcoins in uncertain times, I do still think that there are many worth investing in – especially because we now have some great indicators of which teams are serious about their projects, and which are just bunches of amateurs.

Therefore my approach is to put most of my new crypto money into Bitcoin, but not to neglect the alts entirely. Unlike years gone by when I would put a little cash into just about any semi-worthwhile looking altcoin project (half of which no longer exist!), I can now reap the benefits of that labour but putting my experience and knowledge of those projects and their performance to good use. And here I am sharing that knowledge with you, aren’t you lucky?

What did I buy – and Why?

1. Bitcoin

Roughly two thirds of my investment will remain as Bitcoin, for reasons already discussed above. The remaining third is split among a small basket of alts. For those who are interested, my portfolio is now almost exactly 50% BTC.

High market cap altcoins are not what I normally buy, but as part of a long-term strategy to start consolidating into the coins which are going to be around the longest, I focussed this buying opportunity on less risky coins – at the probable cost of less extreme ROI.

2. Ether (ETH)

As Ethereum finally heads towards Proof of Stake, Ether becomes an increasingly hot commodity. And say what you like about it being older, slower or less technologically impressive when compared to newer platforms; Ethereum still has the greatest number of useful crypto DApps running on it by far! No, your silly little pay-to-win blockchain games and dodgy-looking online casinos running on most of the other chains are not quality DApps. Those other chains count low quality DApps as measure of their success, you shouldn’t. QUALITY DApps will survive, not quantity DApps!

3. Bitcoin Cash (BCH)

What’s not to like about Bitcoin Cash? Widely accepted, it has become a legitimate payment standard across crypto-friendly platforms, much like Litecoin or Dash.

Unlike Bitcoin SV, Bitcoin Cash is the real deal – in fact – there are those (Roger Ver & Co) who would argue that it is more Bitcoin than Bitcoin itself. If you look at that argument, it has serious merit: Bitcoin implemented the off-chain SegWit scaling, BCH didn’t. Like it or not, that makes Bitcoin Cash closer to the original Bitcoin. Had BCH waitied a few months before increasing the block size, then BCH may just have become the de facto “Bitcoin”…

The future of BCH is secure and bright. So I bought some.

4. Kyber (KNC)

Some coins are hugely popular, yet are hardly used (e.g. Verge). Kyber Network Crystal is the exact opposite of those. While it flies under the radar, KNC is an integral part of an enormous and highly active decentralised crypto trading network.

To put things into perspective: (Figures from https://www.coingecko.com/ at time of writing)

24 hour trading volume:
Kyber:                             $98,977,935

Tezos:                             $90,704,910

Market Cap:
Kyber:                             $198,806,890
Tezos:                             $1778,336,240

Need I say more?

5. QTUM (QTUM)

If you thought that Kyber was impressive, then just watch this:

This semi-BTC/semi-ETH UTXO-with-smart-contracts coin is widely known but seldom spoken about. Did you know that there are 1676 QTUM full nodes in operation? (at time of writing.) The trading volume is enormous when compared to its relatively low market cap. Look at QTUM next to chronically over-hyped ChainLink:

24 hour trading volume:
QTUM:                             $345,996,932

ChainLink:               $352,156,925

Market Cap:
QTUM:                             $154,013,153
ChainLink:               $1426,768,599

I picked up QTUM because I believe it to be a solid coin which is grossly undervalued.

6. Everex (EVX)

Speaking of grossly undervalued solid coins: I bought Everex too.

One should note that crypto in general is grossly undervalued. Within that ecosystem, altcoins are particularly undervalued. So when I say “undervalued” in this context, I mean “an undervalued coin, relative to an undervalued subset of coins, relative to an undervalued asset class” – triple undervalued.

In case you did not know, Everex is an Ethereum-based cross-border payments coin/wallet/protocol which specialises in stablecoin and fiat currency transactions.

With a market cap of only $5 million, I consider it to be a steal.

7. Binance Coin (BNB)

Do I really need to explain this coin to anyone?

Analogy time: Binance is the Google of the crypto world – it’s in everything, it IS everything, it’s branching into everything else.

Buying BNB is like buying shares in Google – 20 years ago.

Yes it’s not ideal that Binance is over-centralising crypto, but we’ve already dealt with that in detail. (Highly recommended reading)

What Didn’t I buy – and Why Not?

Opacity (OPQ)

Opacity gets a special mention because I DID buy it, just not right now. I bought Opacity about a month ago, though I didn’t spend nearly as much as what I spent on the seven other cryptos already mentioned here.

In case you were wondering: Opacity is an anonymous online file storage coin. I use Opacity in my everyday life: I backup important files to it and I’ve also used it for file-sharing, much like Dropbox, but without the insanely poor DropBox system. The Opacity interface ISN’T great and it DOES frustrate me, but it’s still in its early days and I am able to do what I want to do with it, albeit slowly. I have no doubt that this will improve with time.

The big bonus with Opacity is that theirs is a paid service. Like a Google Drive, you do get a relatively small free service (10 GB) and can pay for greater amounts of storage. That’s where OPQ comes into it. Storage is priced in both USD and OPQ. The OPQ prices are FAR lower, by many orders of magnitude, thereby strongly incentivising the use of OPQ and creating a legitimate method of increasing OPQ token value.

For a handful of USD, I have bought myself enough OPQ to cover my storage needs for the rest of my life! Why not go try out the free plan and see for yourself?

CargoX, NEO and Nash Exchange

These coins should all be well-known to anyone who has read my older blog posts. All four of them are coins that I am wild about and which I hold relatively large amounts of (when compared to the rest of my portfolio).

… and therein lies the problem. I believe in balance and a diversified portfolio, so I can’t justify putting more money into coins which I have already put so much money into.

CargoX (CXO) has been my favourite low market cap coin for YEARS. It’s a shipping industry coin that does some very clever electronic blockchainy things with shipping and other documentation – saving a lot of time and money and doing the job far better than it can be done by legacy systems. It has its ups and downs, but it’s had an absolutely stellar (not Lumens) week and is currently on a roll. (I trust that you caught my Twitter post about it earlier today).

NEO (NEO) has been my favourite platform coin since before it was even called “NEO” (which happened in the latter half of 2017). NEO 3.0 is well under construction and the platform just keeps getting better. Nothing else out there is this advanced, easy to use, cheap and – dare I say it – well positioned to take advantage of the Chinese economy. Ethereum is far bigger and I don’t see NEO catching up to it any time soon, but I DO consider that NEO has the potential to catch up to it later.

For years I have been saying “watch China, invest in China” – perhaps if you’ve had an eye on recent geopolitics then you are starting to see why. My “Brain” surname is not just an attempt to sound clever, it’s because I AM clever!

Nash Exchange token (NEX) is the coin of my favourite DEX (DEX and more). Nash is still in its early days, but has a great team and a serious competitive advantage derived from already having jumped through major regulatory hoops. It promises atomic swaps between various chains (some of which are already in operation) and has a great staking program. It does require KYC (though I think there is an option to use it with limited functionality and no KYC), something which I hate, but at least it is non-custodial. (My latest policy is to turn away as soon as a crypto project asks for a name, phone number etc – that’s what projects like Civic are for!)

If you need to know more about any of the coins mentioned above, then search my blogs because I have written about them extensively.

WAX, KuCoin Shares, Enjin coin, Tron and VeChain

Unfortunately my funds are not unlimited, so I have to draw the line somewhere. The six altcoins I bought have something in common, they can all be traded on Binance. That’s no coincidence: I decided to split my purchases by exchange. Since Binance had six of the coins I wanted, I traded there first. But, as I wrote earlier, I will be DCAing into BTC for the next few months, during which time I will use some of that BTC to buy additional altcoins. The coins mentioned in this section are all coins which I still plan to buy this year. All of the altcoins mentioned below can be found on KuCoin, which is where I am probably going to be doing the majority of my trading for the rest of the year.

WAX (formally: “the Worldwide Asset eXchange, ticker symbol “WAX” or WAXP”) is a gaming marketplace coin. Based on the EOS code, WAX has an independent blockchain which it operates as an online gaming platform and marketplace. It interfaces with popular games such as Prospectors and recently hosted the launch of the first series of blockchain-based Garbage Pail Kids trading cards (some of which I have already bought and sold for profit). I still see WAX going far in the online gaming industry, and as someone who has been gaming since the ’80s, I would know. WAX also has a great staking program (through staking, my WAX should more than double in three years).

Ever since its launch (at around the same time as Binance), KuCoin has been my favourite exchange. The less popular (yet better) little cousin of Binance still has the best exchange token in the business. I generally follow the rule about not leaving your coins on an exchange, but KuCoin Shares (KCS) is where I break that rule (a break which is logically sound, since if people’s KuCoin shares happen to vanish, then KuCoin would either have to reimburse you, or it would be the end of the exchange anyway and the coins would have little remaining value).

I have written about KuCoin on more occasions than I care to remember, feel free to browse through my blogs and discover that wealth of information. Synopsis: It’s a brilliant exchange with a brilliant token. I know of no better exchange token, not even BNB or NEX.

If WAX is going to go far in the online gaming industry, then Enjin Coin (ENJ) is going to go even further. Enjin is the gaming coin which I hold the most of and which I have been holding the longest. It’s a gaming platform, a market, a wallet and more. It’s also (and here I speak from experience as opposed to from any quantitative metric) the most popular gaming coin of the crypto world. You can buy ENJ on Binance too, but I already have a little ENJ sitting on KuCoin, so I will buy there again to save on the transaction fees of shifting coins around. (I sometimes buy a dollar or two of a coin at a time and then let those small amounts build up until the transaction fees become relatively low enough to move them.)

Tron (TRX) Do I really need to explain Tron or my reasons for buying it? It’s a big coin, it’s a good coin, Steemit integration may help it (pity about the actions of the money & power-greedy witness cabal – now moved to Hive). I want more of it. Like Enjin coin, I already have some TRX on KuCoin, so I will be buying more there. It should be mentioned that I also make use of KuCoin’s “Soft Staking” of TRX to earn myself more and to get myself airdrops of coins like BTT. But that is a risk which I have decided to take for myself, and I still do not recommend leaving your coins on an exchange.

The final coin remaining on my shopping list is VeChain (VET) [or “Vechain Thor” to those who prefer to use that rather ridiculous name]. Like Tron, VeChain requires little introduction. Think: big, decentralised logistics coin. There is serious money to be made from holding VET IF VeChain ever really takes off. I’m buying some in case it does.

Conclusion

It feels really good to be out altcoin shopping again. I sorely miss the days of old when I would buy 5-10 alts every day! I can’t imagine going back to that life now, but I would welcome a more active and hyped altcoin market with open arms!

Remember: Do Your Own Research!

Remember: You get the best deals when there is no hype in the market! (like now)

Remember: “Hodl” is not only a viable crypto strategy, it’s a good one.

Yours in crypto

Bit Brain

Featured image from pexels.com

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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