Building A Strong Crypto Portfolio

8 Nov 2021 | Cryptocurrency news

Crypto is becoming a mainstream asset in investment portfolios. In recent years, crypto has been gaining a lot of interest among investors of all shapes and sizes. Both newcomers to the world of asset building and seasoned investors are turning their heads toward the thought of adding cryptocurrencies to their portfolios. It’s clear to see why. With crypto being a revolutionary development in financial technology, it has the potential to change the way we perceive the financial service industry.

That’s why many investors with largely traditional assets (stocks, ETFs, bonds etc.) are now spicing up their holdings with cryptos like Bitcoin, Ethereum, XRP, Litecoin and many more. After all, there are thousands of cryptocurrencies out there with exciting possibilities that have made attractive returns for their holders.

Cryptocurrencies, or cryptoassets, are digital assets that are cryptographically-secured which can be stored, transferred and traded virtually.

The defining feature of all cryptographic assets is that they are based on distributed general ledger technology, or DLT. A distributed ledger is a consensus of replicated, shared, and synchronized digital data geographically spread across multiple sites, countries, or institutions. Unlike with a centralized database, there is no central administrator, providing a higher level of security.

Due to the fact that the entirety of the information in the aforementioned database is stored across the network, it is referred to as decentralized.

The crypto scene itself is relatively young and gaining momentum with immense power. For example, the ‘leader’ of cryptos, Bitcoin (referred to as digital gold), is only 12 years old. To illustrate, the estimated number of existing crypto projects exceeds the threshold of 6000, with the biggest, by market cap, being Bitcoin, Ethereum, Cardano, Dogecoin and Litecoin. As of October 2021, the total crypto market capitalization stands at roughly $2 trillion dollars.

Investing in cryptoassets has a number of appealing factors. Here’s some of the biggest virtues of investing in crypto:

  • A stable store of value

A widely spread reason to invest in cryptocurrency is the need for a reliable and long-term store of value. Most cryptos have a certain amount of limited supply which makes it impossible for any political force or government entity to manipulate their value through inflation. This cannot be said about fiat money. In addition, the cryptography behind cryptos makes it infeasible for a government to tax or confiscate the cryptoassets or confiscate them without the owner’s consent.

  • Revolutionary technology

The technology underlying cryptocurrencies has been praised as the revisionist for a large variety of industries, like banking and finance, healthcare, retail, supply chains and many others. Distributed ledgers can facilitate new kinds of economic ventures by removing intermediaries from computer networks that were not considered possible until now.

This opens up the possibility of supporting the future of technology and earning high returns for people who believe in the not-too-distant future of digital currencies.

  • Low investment threshold and fees

You don’t need a lot of money to get into crypto. The widely spread belief states that you need to have thousands to get into investing in order to see noteworthy returns. That’s not the case at all. In reality, it’s a process, like investing in any kind of financial asset. You can buy a large variety of coins for minimal fees at Guardarian for a price that you’re comfortable with.

  • Around the clock exchange access

Unlike the stock market, the crypto scene never sleeps. Markets are open 24/7 and you can buy and sell your coins whenever you want. You can grow your crypto portfolio at 3AM on a saturday night, if you want. Even more so, Guardarian makes sure the exchange process is fast and reliable at all times.

What to keep in mind when building a crypto portfolio

Before starting to build your crypto portfolio it’s advisable to do your research in order to make sure you’re getting the best possible outcome in terms of your personal goals and investment strategy. There are imperative factors to take into account when compiling your crypto portfolio and we’ve listed a few of them here:

  • Be in touch with the current crypto values

The crypto market is constantly changing due its volatile nature and it’s important to keep an eye on the price movements. The volatility of crypto can be a very good thing due to the fact that you’re constantly presented opportunities to trade the coins with the price most favorable to you. A good website to start monitoring various cryptocurrencies is CoinMarketCap, which gives you a good overview of all the projects in question.

  • Read the whitepaper

A cryptocurrency whitepaper is the foundational document for that project. The whitepaper should specify the background, goals, strategy, and timeline for implementation for the crypto project at hand. Check to see if the whitepaper has additional information, including financial models, legal concerns, SWOT analysis, and a roadmap for implementation.

Reports like these give you an essence of reliability and explain how the crypto project works.

  • What use does the currency have?

Your best chance of a successful investment relies on the cryptocurrency having an achievable and feasible set of aims. The company should have a compelling concept for the time being, but it also must be able to carry that concept over into execution over the short and long terms alike. Ask questions like: “What gives the coin its value?”, “How will it be used?”.

Currencies that are set on innovation and bringing value can also be valuable to you. Here you can get acquainted with the vast selection of coins we have on offer.

  • Diversify

As with any investing portfolio it’s important to diversify. Different cryptos have different characteristics that you’ll have to align with your personality when it comes to investing. The coins you decide to invest in should align with your time frame and overall goals you set. It’s all about balance.

  • Stay up to date with the scene

Blockchain and cryptocurrency technology is developing at a rapid pace, providing new opportunities daily. Keep up to date with developments in the crypto world and follow news and blogs (like this one) to stay informed. Like with traditional forms of investing, news cycles can affect values. Keeping yourself posted on developments gives you the chance to make informed decisions about your investments.

There are loads of cryptocurrencies on the market right now, which means there’s no time like the present. The opportunities for building a rich crypto portfolio are as advantageous as they’ve ever been.

October was a good month for crypto investors. For many coins the price went up the roof and skyrocketed massively. Fore example, in one month, the bitcoin price has experienced around 50% gains.

The best day to enter a position in crypto is today. There are about 120 million investors in cryptocurrencies today worldwide. Analysts expect this number to grow around 10x over the course of 5 years. That means the overall market will grow in the long term as well.

So, ready to add crypto to the menu?

To compile a strong and balanced crypto portfolio head on over Guardarian’s Currencies page to get familiar with over 250 most popular crypto coins to enrich your portfolio with. Our exchange process is faster than ever with no registration required.