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My Cryptocurrency Portfolio – July 2018

~ 8 Minute Read

 

Where Are We On The “Market Grief Chart”

 

 

Okay, I’ve been writing my cryptocurrency portfolio reports since February and this is the first time I’m not sure where to start this update.  Things are pretty much where they were a month ago without a whole lot of movement in the market in recent weeks (up until today).

With that understanding, I want to take a look at a chart that helps to visualize the mental anguish many of us crypto investors have faced since the beginning of 2018.  It is taken from the stock market, but can represent the stages of financial grief in any market.  Here it is:

If you are wondering if I’m just making this stuff up, check the bottom right, this chart is based on “academic studies”, so suck it!

Looking at this chart it is pretty clear that I had an epic case of the euphorias during the monster run in late 2017.  It’s a little embarrassing some of the thoughts that came to my mind during that time.  Things like “early retirement” and “lamboooo!!!”  were not out of the question in my mind.  The sky was the limit, baby!

With a swift kick in the cryptos, early 2018’s crash brought me down to a uncomfortable reality.  The euphoria was long gone and was replaced with a feeling of despair and the regret of not taking some profits in such a early and volatile market.  Lesson learned.

Here in present day, it’s pretty clear that we are somewhere between anger and despair.  I’m certainly over the anxiety, and there’s not much to deny at this point as the market went on a free fall only rivaled by Harvey Weinstein’s career.

Is the worst over?  I don’t know, as a couple months ago I was flirting with the “hope” stage of this chart for a short period, and then that recovery sputtered.  There are some things on the horizon that may help turn the tide in the long-term.

 

Will Institutional Money Create The Next Run?

 

There has been some whisperings that institutional money is getting ever closer to entering the cryptocurrency market.  Within the last few days it has been widely reported that BlackRock is considering some sort of entry into crypto in the future.  This is big news as BlackRock is the largest provider of exchange traded funds (ETFs).  There have been reports from the CEO of BlackRock, Larry Fink, that none of his clients have an interest in exposure to Bitcoin or other cryptos at the current time.  Seems that there is some confusion as to what BlackRock’s interest is in the cryptocurrency market and blockchain in general.  Time will tell if BlackRock does indeed enter this space, or if Mr. Fink is hardened against it (he has historically been a crypto skeptic).

But BlackRock is only one institutional investor (albeit a big one), and there are many others out there that could eventually desire exposure to this space.  If the Chicago Options Board Exchange (Cboe) can get the SEC to approve of a crypto ETF it could open the flood gates for other institutional investors to add crypto exposure for their clients.   The SEC has to make a decision by August 10th.

This is important because an ETF will make it very easy for the average Joe to get involved in the cryptocurrency market.  No more having to learn how to use Coinbase and trusting exchanges that have a history of fraud and hacks.

At this point crypto is at a crossroads as an investment class.  Best case scenario: the SEC approves the Cboe’s effort to create a crypto ETF and institutional money rushes in creating a bull run that makes the previous run look like the NBA’s summer league.  Perma-bull Mike Novogratz believes this could create a total crypto market cap of $20 trillion.  For comparison, the late 2017 run brought the entire crypto market cap to ~$750 billion.

Worst case scenario: the SEC denies the crypto ETF setting the stage for further uncertainty in the market.  There is also a very real possibility that the demand for cryptocurrency ETFs and exposure are much lower than Novogratz is predicting.  The remarks by Mr. Fink are unsettling in this regard.

How this plays out is anyone’s guess at this point.  If I were looking to get into the crypto market right now there are two ways you can play this as an investment.  You can “buy the rumor, sell the news” when it comes to the SEC and the Cboe’s efforts for a crypto ETF.  In that case I’d buy now and sell before the August 10th deadline for the SEC’s ruling.

The other option is to wait to see if the SEC approves the ETF.  If so, watch for the market reaction before jumping in.  If there is some serious upward movement then consider investing.  If the SEC does not approve the ETF, simply stay out of the market as it will likely create some new lows for the year.

 

My Portfolio

My portfolio hasn’t changed since my last post, but I’ll continue to keep this chart updated so you know where things stand.

Here are the current projects I’m invested in and the percentage of my portfolio allocated to each:

Coin

Percentage Allocated

Market Cap

As of 7/17/18

Investment Plan

Bitcoin (BTC)

30%

116 Billion

 Hold Long-Term

 Ethereum (ETH)

 23%

48 Billion

Hold Long-Term

Basic Attention Token (BAT)

9%

355 Million

Hold Intermediate Term

 Ripple (XRP)

 8%

19 Billion

 Hold Long-Term

 OmiseGo (OMG)

 5%

1 Billion

 Hold Long-Term

 Waves (WAVES)

 5%

290 Million

 Hold Intermediate-Term

Monero (XMR)

5%

 2.23 Billion

Hold Long-Term

Siacoin (SC)

 5%

396 Million

Hold Intermediate/Long-Term

 Cardano (ADA)

4%

3.96 Billion

 Hold Long-Term

Litecoin (LTC)

3%

4.82 Billion

Hold Intermediate/Long-Term

Civic (CVC)

2%

66 Million

Hold Intermediate/Long-Term

Bitcoin Cash (BCH)

<1%

7.7 Billion

Hold Intermediate-Term

Portfolio Performance

Here are some screenshots of how my portfolio has performed over time.  Realize that the percentages gained/lost for 1 years and 6 months are not accurate as I have continued to add money into my investments over time, but it does give you an idea.

1 Year- +245.81%*

 

 

6 Months- -54.43%

 

 

3 Months- -21.91%

 

1 Month- +5.16%

 

1 Week- +17.14%

 

(* means percentage not accurate due to additional contributions)

Previous Cryptocurrency Portfolio Reports:

June 2018

May 2018

April 2018

March 2018

February 2018

 

Disclaimer:

“TheMicroprenur.net and the information contained herein is not intended to be a source of advice or credit analysis with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice.”

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