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Crypto Moves #35 – Keep Altcoins at an Arm’s Length From Your Portfolio

The crypto market has favored Bitcoin and Ethereum this year, while some investors have risked everything on cryptocurrencies with little potential. Given the market's momentum-driven nature and the upcoming Ethereum spot ETFs, we see no reason for this trend to change going forward. Additionally, we examine unlocks, from which Bitcoin and Ethereum are also spared.
2024-07-04

On March 7 of this year, we dedicated an entire edition of Crypto Moves to discussing our belief that this crypto bull market is the least speculative one yet. This edition, Crypto Moves #18, was aptly named: “The Least Speculative Bull Market,” and included the following summary:

“The crypto market is getting less speculative by the minute. There is no need to chase the next big thing by risking funds on obscure altcoins or memecoins. Instead, by aligning with institutional movements, crypto investors stand to gain significantly without taking on too much risk.”

The conclusion of that note was clear:

“In essence, in the current bullish market, investors do not need to chase the next big thing by risking their funds on obscure altcoins or memecoins in hopes of massive returns. Such strategies are fraught with immense risk and are unlikely to be successful for the majority. The strategy should be simpler, and perhaps less exciting for some.

We predict that Bitcoin and Ethereum will outperform most of the market, despite their already substantial market capitalizations, without requiring investors to shoulder excessive risk. There are simply no better risk/reward propositions than Bitcoin and Ethereum, offering considerable potential gains with relatively low downsides.”

We strongly advise our clients to read the note, not only because it has been spot-on since its publication (mom, watch me) but mainly because we believe this will continue to be the case moving forward. Before we delve into the reasons for our confidence, let us examine the performance of the broader crypto market this year.

Chart 1: Total Crypto Market Capitalization, Incl. and Excl. Bitcoin and Ethereum

The crypto market has favored Bitcoin and Ethereum this year, while some investors have risked everything on cryptocurrencies with little potential. Given the market’s momentum-driven nature and the upcoming Ethereum spot ETFs, we see no reason for this trend to change going forward. Additionally, we examine unlocks, from which Bitcoin and Ethereum are also spared.

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