Since its inception Bitcoin was the one and only cryptocurrency. If you wanted to invest in the success of cryptocurrencies, you bought Bitcoin.
Other cryptocurrencies – called “Altcoins” – have just been penny stocks on shady online-markets, mostly used to keep miner’s GPUs working, pump the price and dump the coins.
However, this has changed. While Bitcoin is still the dominant cryptocurrency, in 2017 its share of the whole crypto-market has rapidly fallen from 90 to around 40 percent. Many people saw this coming as a result of the growing popularity of Ethereum and the ongoing self-tearing of the Bitcoin community over the block size issue. This again shows that it is important to keep your eyes open and listen to what the communities say.
If you want to invest in cryptocurrencies, Bitcoin is still a standard item of every portfolio – but it is no longer the only asset. In every well-balanced crypto-portfolio today you find other coins, like:
There are almost 800 digital coins available today, but many have little or no liquidity or exchanges to buy them. More interesting however is it to take some time, read about those coins, decide, if their vision gets you and make this to the base of your asset selection.
Another factor to decide which exchange you use is some coins you want to buy and your patience. If you want to acquire large sums of Bitcoins quickly you need to use one of the major exchanges like COINSTEC™ which provide enough liquidity. If you only want to buy small amounts of coins and if you are not in a hurry, you can try to buy them on small exchanges. If your order gets filled, you most likely will get better prices than on big exchanges.
The question, what exchange to use depends mostly where you live. It’s always better to use an exchange physically close to you. If it is located in the same jurisdiction as you, you have the best chances to get money legally back if some bad things happen. If no exchange is located in your jurisdiction, it is better to use exchanges based in stable countries with a good legal system.
According to Investopedia, “Risk involves the chance an investment's actual return will differ from the expected return. Risk includes the possibility of losing some or all of the original investment.”
While constructing a portfolio of stocks, blue-chip stocks are usually preferred, as they are perceived to be comparatively less risky.
Bitcoin and the other currencies are not limited only to technology nerds; even the United Nations has used the Ethereum Blockchain to send aid to Syria.
Various central banks across Europe and Asia are said to be contemplating using cryptocurrencies.
IBM has joined the likes of Nestle, Unilever and Walmart in the war against food contamination using Blockchain technology. Other than this, various other companies are pondering using the Blockchain technology for various purposes.
Japan has been at the forefront in adopting digital currencies. In April of this year, it recognized Bitcoin as a legal payment method. Other nations are also likely to follow suit.