Crypto Investing Explosion

Something seismic has just happened in the world of crypto investing.

No, I’m not talking about the surge in the value of Bitcoin.

Impressive as that is, something a lot bigger has just occurred. It has happened so fast that even those in the ‘crypto community’ haven’t fully worked out what is happening yet.

And the consequences of this event could be massive.

Both in returns and in risks.

Before the Bitcoin Boom…

Let me take you back six months, before the recent renewed interest in Bitcoin.

Six months ago, Bitcoin was the only game in town.

There actually was a previous wave of so called alt-coins back in 2013/14 when Bitcoin first gained a bit of interest.

But these ‘scam’ coins as they came to be known offered no advancement on Bitcoin itself and were mainly novelty or experimental coins derived from the bitcoin protocol, with a few tweaks here and there.

Gradually the alt-coin market died down, and it was all about Bitcoin once again.

Six months ago, Bitcoin was 90% of the market, Ethereum was 5%, and all these other alt-coins combined made up the last 5%.

Fast forward to today and look what has changed.

The state of crypto today…

Today Bitcoin is just over 50% of the market and the alt-coins, including Ethereum, are almost 50%!

The total value of coins and tokens has quadrupled relative to Bitcoin.

And remember Bitcoin has been on a tear, so that means this market has grown very fast indeed.

The old saying about a rising tide lifting all ships is true to an extent.

But the dollars going into alternative coins are also based on technological developments a lot more advanced than the initial alt-coin wave.

The rise of Ethereum

The second reason is the rise in Ethereum.

And what a rise that has been. From $15 only four months ago to $512 today.

What’s particularly interesting about Ethereum is that it facilitates the creation of tokens that sit on top of it.

An underlying protocol layer if you will.

Bitcoin does this too, but the level of programming allowed on Ethereum is a lot wider and hence more experimentation is being done using it by developers.

Which takes me back to my original observation.

Bitcoin is still the most dominant crypto asset. But the opportunities are starting to appear in a variety of other assets. The speed with which a successful token can rise is phenomenal.

I suspect in coming months the speed at which some of them fall will be equally fast. But that is to be expected with all fast-growing industries.

But the tokens that do succeed have still got unbelievable growth potential ahead of them.

Luckily the same techniques of risk management, position sizing and careful research that are used to evaluate stocks in the small-cap sector, can be used in this industry too.

Bitcoin Boom: How You Could Turn Every $500 You Lay Down into a $10,000 Cryptocurrency Fortune…find out here 


Ryan Dinse is an Editor at Money Morning.

He has worked in finance and investing for the past two decades as a financial planner, senior credit analyst, equity trader and fintech entrepreneur.

With an academic background in economics, he believes that the key to making good investments is investing appropriately at each stage of the economic cycle.

Different market conditions provide different opportunities. Ryan combines fundamental, technical and economic analysis with the goal of making sure you are in the right investments at the right time.

Ryan's premium publications include:

Money Morning Australia