@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?
Yeah absolutely. If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of. I also cash out some of my defi yield every week but mainly I use it to buy more crypto.
Sorry if I missed this earlier. If you don't mind my asking, @Juan Ponce de León, what % of your portfolio is in crypto vs conventional financial assets?
Is % the way you allocate to the non-crypto portion, or do you have other criteria instead (5 years' conventional assets, paid off house but the rest is crypto, etc)?
Are you seeking a FIRE target in some conventional way (eg, 25x annual spending) or using other goals for your accumulation strategies?
It's about 60/40 crypto vs stocks. That was never the plan it's just the way it's worked out. I don't put any new money into crypto and I try not to pull too much out, I'm basically playing with house money now so I'm happy to let it ride. I'm not getting ahead of myself in regards to FIRE targets or anything like that. If it happens, it happens. If it all crashes to zero I'll diversify into tulip bulbs.
I'm curious about your allocation amongst your cypto assets, do you mind sharing? Here's mine:
VTSAX = 50%
Crypto = 50%
Of the Crypto, here's the current breakdown(it changes daily, because as you know, the price of all these things is terrifically volatile):
Ethereum = 56%
Bitcoin = 34.3%
alt coins = 9.3%
Of the 9.3% that I have in alt coins, here's the ones I have a small position in:
Cardano
Solana
Uniswap
Chainlink
Litecoin
Bitcoin Cash
Enjin
Polkadot
Avalanche
Aave
VeChain
My pf is very defi oriented and honestly not ideal, a lot of my coins are paired in liquidity pool tokens and paying daily yield, which I guess I'm kind of addicted to since that's how I got going in crypto and had my first big wins. Anyway I've looked at a pf tracker and added a few other things in and I believe my pf exposure is very roughly
BNB ~33%
AVAX ~17%
ETH ~15%
BTC ~15%
CAKE ~10%
SOL ~ 5%
Over represented in BNB due to all the yield farming on Binance Smart chain, CAKE-BNB, ETH-BNB etc. Looking to fix it in the coming months if we get an ALT season blow up of prices so I can break up and offload some of these farms and get back to a more basic bitcoin/eth dominant pf. I'll also cashout a chunk of lifestyle tickets if things go well. Whether I achieve it or not before the market pulls the rug again I don't know haha.
I'll be frank, I kind of agree with Boarder420. You'll probably get yourself rekt'd if you are not lucky enough to get your timing down right. You could end up with 90% losses overall with such large bags full of shitcoins. I mean that with all due respect. How confident are you that BNB/CAKE/SOL/AVAX will rebound after the next crash? Don't get me wrong, all of them could. But they could very well be the next Neo, NEM, QTUM, ect. Not all crypto bounces back after a bear market and we will most likely have another bear market in the near future. Now is the time to sell the shitcoins and take profits and/or get into Bitcoin/Ethereum. At least you have a good basis to think Bitcoin/Ethereum will rebound after the next crash.
I don't know if you were around before 2018 but a lot of the top shitcoins from 2017 never recovered. For every ADA there are three EOS'. I am not saying there is not place in your bags for shitcoins -- I got my own shitcoins -- but lets be real here; they are only good for getting more Bitcoin/Ethereum.
It depends on your definition of rekt I guess. I never said my strategy was without risk, but without those risks I wouldn't even have the PF I have now. In January I had ~US$8k in crypto and now it's in the hundreds of thousands. I've also been paying my CC in full with it each month for awhile now so I'm firmly in freeroll territory with this money. Yet if you asked Boarder42 he'd probably tell you I'm some kind of crazy idiot sniffing unicorn farts? I'm not sure what he was really on about.
Also I think your definition of shitcoin is quite a bit loser than mine. BNB is #3 coin by market cap and native coin of the largest exchange, it's sitting at $100B by market cap. Sol is #4, AVAX is #11. You have to weight up the risk vs the reward. CAKE I guess I just have some kind of misguided loyalty to the project. First bought CAKE in Feb for $2 and BNB for $44, i think cake-bnb was paying 200% APR at the time, recompounded the yield and built a PF out of CAKE. In that first run cake went to $45 and BNB went to nearly $700. I sell CAKE every day, morning and night if I remember. I've sold more cake than a cake shop LMAO. It's still paying a decent yield.
One thing I will say about the defi yield is that it makes me sleep better at night knowing I have a few hundred dollars a day coming in that I can sell and not feel like I'm selling a dip or about to miss a pump etc. For me it's guilt-free selling that is income and doesn't equal a capital gains event. I can pay off my CC or buy some more bitcoin/eth/stock ETFs or some other crypto project. For me the yield was a gamechanger, just owning a set amount of coins that doesn't change seems stagnant in comparison, like owning stocks. Having said that, I learned some lessons in May when we had the large correction and if alt coins blow off again like that I am going to try and derisk some to the best of my judgement. We don't seem to be there yet though. Good luck with your own holdings.
Everything that isn't Bitcoin or Ethereum is a shitcoin. That includes ADA which is 10% of my crypto portfolio, lol.
The May correction was nothing. All these alts, including BNB and ADA, will dump 80-99% from wherever their high is. May was what, 50%?
Yeah I think BNB was ~70%, I have no doubt you're right. BTC itself dumps ~80-85% in the bear market.
I edited my comment above.
Is your money tied up in "liquidity pools"? Isn't it fairly common for these things to get hacked or or drained by insiders who then disappear? It seems they have a significant amount of additional risk but I guess that's why the rewards are so -- well -- rewarding.
Yeah it's not without risk that's for sure. Fortunately none of the projects I've ever been involved with have been affected. I guess the longer they've been running the less likely there is an exploit in the contracts waiting to be exploited. Pancakeswap has over 13 billion$ staked on it. If anyone hacks or rugs it, good for them honestly, that will be the heist of the century.
My holdings are 75% BTC, 20% ETH, only 5% altcoins - FTM-LINK-MATIC - I know, super conservative except for FTM but it is my first rodeo (4yr cycle), so I'm hanging back mostly observing and still learning. Basically, I've got a HODL portfolio. It turns out I am more risk-averse than I thought.
It is a great start.
I'm not convinced that we will have an 85% crash on bitcoin, more like 65% given the institutional presence. I will not panic sell:). Whenever the bear market returns I plan to slowly acquire another 0.50 bitcoin for a total of two whole bitcoins. BTC and six ETH will remain in my long-term portfolio.
Apparently, many of the altcoins do crash 85% except for the so-called blue chips that hold their value better.
BOA just announced they might offer loans against crypto assets. This is exactly what I expected to happen. In the future, people will use bitcoin as collateral instead of selling it.
You don't give up generational wealth - just sayin'.
SOL-DOT-AR-RUNE-RAY-ADA-LUNA-SANDBOX are all on my watch and potentially buy the dip list - long term, along with three gaming coins - short term. I'm building a small Degen portfolio and will set up a couple of limit orders. It's all so frothy right now, all that FOMO and the Fear and Greed Index - ugh.
Not rushing to buy, if at all.
I do love the altcoins. Business is business - the alts are just tech start-ups. My background is in risk analysis (global underwriting) so I get great satisfaction from looking into the tokenomics (no rug pull potential), the experience of the developers, the quality of the VC they attract and whether they re-invest in the next round, the utility of the project, past successes and evidence of network building, whether they meet their upgrade deadlines, the business connections and the people....
It is endlessly entertaining - imagine approx. 12000 coins - but only 1% will be successful.
I do think the in-game play to earn and other games will be wildly profitable, but it is a niche, so those will be my occasional super risky play along with never more than one microcap. Except for Axie I don't plan on holding any gaming coins long term.
Other than that, I will leave the intriguing Metaverse and baffling NFTs to the crypto pros.
FTM-Fantom is my only speculative altcoin pick so far. Looks promising and has a good chance to survive and thrive in the next cycle. That's what I want - blue-chip alts - a portfolio of ten coins tops, monitored consistently. We'll see.
Once all this hype is over and things settle down maybe by Dec-Jan or so I'll get serious about DeFi passive income. I have a new plan but somehow I've let myself become intimidated by all the steps and wallets in defi.
My area has several different crypto meet-ups incl a massive contingent in Orlando and of course Miami. Maybe I'll even meet Alex Machinsky in person one day since Celsius opened a new office in Tampa.