When Redditor Joe Greene began experimenting with Top 10 Cryptos in 2018, he bought $1,000 of Dash, NEM, and Iota, among others, just to watch them crash to $150. But five years later, his experience paid off a lot.
Rules: Buy $100 of each of the top 10 cryptocurrencies on January 1, 2018, 2019, 2020, and 2021. Just keep. not sell. No trading. monthly report.
Every January since 2018, Green has reviewed a list of the top 10 cryptocurrencies by market capitalization from his tropical office in Bali. He puts $100 of his money into each of them, tracks performance every four months or so, and posts the results on his website and on Reddit.
When it started, cryptocurrency indexes were few and far between, so there was no easy alternative. Having invested in stocks for years before moving into cryptocurrency, Green predicted that chasing tokens on a hot streak is dangerous – unless it is done consistently – and this has already been proven by his experience with the top ten crypto funds.
Bitcoin 2017
Like just about everyone else that year, Greene was fascinated by the sudden surge of bitcoin during the 2017 bull run. “I remember looking to buy a rig to do some mining, but it turned out they all sold out. So, I thought, ‘Whatever, I’ll just go out and buy’ Some coins instead,” he told a magazine. A combination of core technology, and financial elements The future direction of the asset class will keep Greene in the sector. He’s been blogging with the project ever since.
Initially, Green was relatively new to cryptocurrency as was his audience. He explains:
“I came through Reddit and a few articles online, and pretty much everyone was arriving with minimal returns, even though there are a few diamonds in the rough.”
Faced with uncertainty, Green decided to stick with his normal investment philosophy of sticking to what he bought and refraining from excessive trading. “Outside of cryptocurrencies, I am not a trader, and I am convinced that very few people are. Only approximately 0.5% of traders are profitable in the long term,” says Green. “So, yes, I am not a merchant. And I learned my lessons a long time ago.” Greene’s core philosophy is that it is safer to invest in low-cost, highly diversified index funds – which is Warren Buffett’s advice to the majority of investors, too. But there simply wasn’t anything like it in late 2017. So, Green decided to make his own thing.
The winner takes it all
The thinking was that, like stocks, cryptocurrencies have also shown signs of “winners take it all,” where the long-term winners continue to win and the losers continue to lose in terms of investment gains. After all, the best performing cryptocurrencies attract all the media attention, Google searches, institutional interest, retail euphoria, etc. So, Green assumed that for individuals who don’t know much about the crypto space, their best bet is Stick to only the best players and be consistent in doing so.
Thus, from 2018 onwards, Greene compiled a list of the top 10 cryptocurrencies on CoinMarketCap at the beginning of each January and tracked their performance over time.
The best lesson he learned during this period, Green says, is the power of the average cost dollar — buying an asset on a regular basis without any regard for the market price. This smoothes out fluctuations in the purchase price and brings it closer to the average price during the period in which it was purchased.
“What goes up doesn’t always stay awake, but the risks can be mitigated by rebalancing monthly,” he said. “My initial portfolio in 2018 consisted of tokens like Dash, NEM, Iota, etc. Although there was a bull market from 2020 to late 2021, none of the tokens I talked about managed to recover their all-time high prices which saw five Years ago. But there were rallies after that, and if you got stuck in rebalancing, you’d do well.”
Winter OG encrypted version
In fact, when Greene put $1,000 into each of the top 10 cryptocurrencies in January 2018, his portfolio dipped below $150 just 12 months later.
However, patience rewarded, and for someone who consistently invested $1000 in the top 10 cryptocurrencies by market cap every January from 2018 onwards, a typical portfolio would have returned a cumulative 87%. Over the same period, the S&P 500 could have generated returns of 24%.
Green points out that the strategy of sticking with the big winners – if implemented consistently – would have worked in the long run. The top 10 cryptocurrency wallets in 2019, 2020, 2021 and 2022 have returned +126%, 338%, +177% and -69% (not surprisingly) respectively so far, essentially offsetting any poor performance during the bear years.
“It’s nothing amazing, like how Twitter claims you can get 10,000% per week by putting your life savings into crypto,” he says. “For any kind of indicator, you will never get the best return, but it will protect you from the worst possible outcome.”
Green explains that his method would have worked better if the index had been able to track the entire market, not just the top cryptocurrency. “Over the same period, a crypto-all-market index would have grown by 224%,” he said.
“That’s the beauty of investing in indices. I have a regular business and a family to take care of. Because of this, I can’t spend 10 hours a day like Twitter and Discord trying to figure out which cryptocurrency will rise more. Me too sucking in nfts. Therefore, we need an investment method for ordinary people who do not devote their lives to cryptocurrency.”
Greene’s experiment and methods have attracted a lot of attention among cryptocurrency curators on social media. When asked about any interesting investing behavior or trading style he’s noticed among his followers over the years, Green said there are a lot of people watching price action with the benefit of hindsight: “It’s like saying, ‘Hey, I bought Doge because it went up, I should have to get it too. I can’t answer that, and they are right. But the trick is to anticipate that in advance.”
There were also a lot of surprises: “A lot of Bitcoin fans have switched to Ethereum over the years, for a start. Then there was BNB, and no one expected this coin to get big, and I think not even Binance CEO Changpeng Zhao expected it.”
On his blog, Greene also has a section dedicated to financial literacy, stating that retail investors should keep track of their bills, have their finances in satisfactory condition, and never risk more than they can afford to lose. His approach meant that he became acquainted with people of a “more conservative mindset”.
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“People who don’t day trade cryptocurrencies,” he explains. And I tell them, ‘Don’t throw everything you have into crypto – that’s a bad idea. “
decade of the top ten
Greene plans to continue with the top ten Crypto index funds until it reaches a decade or so. “After all, I have a family…and a full-time job commitment, which can be very stressful at times.”
But Green cautions that while the experience’s cumulative performance has been good, it’s important to be alert for sharp declines: “Take this year: there are now four stablecoins in the top ten list. It’s a bit boring, so I’m going to have to move things around.” a bit,” he says, adding, “but perhaps I should stick with what I know best. This year I also tried to get a file Bonus on DeFi. It was $130 starting in USD coins, which I exchanged for TerraUSD, just for fun, then I sent it to LUNA, which crashed nicely. ”
from San Jose News Bulletin https://sjnewsbulletin.com/5-years-of-top-10-cryptos-experience-and-lessons-learned-cointelegraph-magazine/
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