A Beginner Guide to Mega Wealth in Crypto (part 1)
(This not professional or individual financial advice)
First, if you are planning to invest in crypto currencies it is imperative that you do your own research and make educated decisions before spending any of your hard-earned cash. Even a little research can make a huge difference in making two, ten, or even a hundred times your money. While there are plenty of people in this sector that shill (hype) all sorts of Cryptos with promises that their coin will solve all sorts of everyday problems, my take is if you’re going to invest money behind a token that’s value is based primarily on demand you must dig further. Pick projects that have exceptional teams, MVPs (minimum viable products), solid roadmaps, realistic use cases, and most importantly the token’s partnerships. I could go further and explain how these projects are essentially creating their own economy with their tokens--which may be true (e.g. elastos)--but if you stick to the aforementioned characteristics that are essential to success in the world of crypto, then you should be on the path towards creating mega wealth in this very young asset class. But for now, I am going to dive into my own portfolio and explain why I have chosen to invest in these projects with the hope of making my own crypto fortune. Why don’t you come along for the ride as well?
The Big Guys
Some tokens in this space are just too big to fail, which is crazy considering the untapped potential in the crypto market. The large market cap tokens (the “Big Guys”) are Cryptos that I’m sure most of you are familiar with but they are still crucial to have in any investor’s portfolio. The Big Guys have already met the characteristics I’ve described above and will continue to be elite in this space for the indefinite future. If you are starting a portfolio from scratch, I’d say to have the Big Guys make up 50-75% Guys for the least amount of risk, 40-50% for medium risk, and 25-40% for maximum risk tolerance. The Big Guys are:
Bitcoin – Bitcoin is the gateway into the Crypto sector, the crypto version of gold, and the reserve currency for all crypto assets. Today, Bitcoin is accepted by more than 100,000 merchants including Overstock.com, Cisco, Wal-Mart, Starbucks, Amazon, and Microsoft--as well as a universally-accepted currency in Japan. Bitcoin's biggest strength is its secure network and worldwide availability. It is the most secure network in the world and virtually impregnable (current estimates suggest that hackers would need at least nine-billion dollars’ worth of equipment to compromise the network.
Bitcoin's biggest weakness is the currency's scalability, transaction fees, and processing time. However, Bitcoin has addressed these issues with two major developments that are widely known and many developments that are slowly arising from beneath the mainstream ignorance. First major addition to the network is Segwit, which partially contributed to a 99% drop in transaction fees since late December 2017. The other major addition comes from the Lightning Network, which is a scaling solution that is integrated into the bitcoin blockchain. The Lightning Network essentially allows bitcoin to transact with instant payments, atomic swaps, and a dramatic reduction of transaction costs. The slowly rising developments that not many people know about regarding the Bitcoin network are MAST and Bitcoin Sidechains. MAST, short for Merkelized Abstract Syntax Trees, aims to improve Bitcoin by changing the way smart contracts are written into the blockchain. With MAST testnet most likely being released sometime in 2018, MAST can increase the privacy of smart contracts by tying less information to public keys, reducing transaction size, and offering larger smart contracts. Another under the radar development is Bitcoin side chains allowing other blockchains to connect to the Bitcoin network using a different coin while simultaneously using the Bitcoin main network. With these upgrades, Bitcoin is proving that it can scale and maintain dominance as the number one cryptocurrency for many years to come. While the big Bitcoin news in 2017 was the launch of bitcoins futures in the United States, 2018 will be the year that the Bitcoin network fixed its scalability issues (and introduced a bitcoin ETF in the stock market to boot). In all, Bitcoin is set to reach new heights greater than ever before.
Ether – The Father of smart contracts, and currently the most popular and widely-used smart contract platform. Ether has an enormous amount of developers building and working on its code that Ether is essentially too big to fail. Right now, Ether is improving its scaling capabilities to accommodate the many adopters working on their smart contract platform. Since the network is too congested due to its TPS (transactions per second), Ether is moving to Proof of Stake; soon it will become faster and be one of the strongest platforms for many years to come. Ether has a strong Crypto sector dominance and is a lock to be the second largest market-cap in the crypto-currency industry.
NEO – This is my favorite crypto of all because I believe it will be the number 1 blockchain in the world within the next 5 years. NEO is a non-profit community-based blockchain project--a distributed network that uses blockchain technology and digital identities to digitize assets with smart contracts to automate digital property. This is NEO’s concept of creating a true “smart economy”. NEO uses proof of stake which allows users to receive passive income for holding NEO in a wallet that’s supports NEO gas generation (1 NEO = 1 NEO GAS over a 22 year span). NEO is the governance token of the project and NEO GAS is the token to pay for all the service fees on the blockchain. NEO incentivizes its community to participate in network decisions through incentives like crypto-community competitions for NEO rewards, airdrops, and charging gas fees to create and use smart contracts on the platform. NEO was also developed for government compliance in China and is currently the strongest blockchain in that region. In all, Neo is committed to becoming a more decentralized crypto as the roadmap for the project evolve into a very dominant smart contract platform in China but also worldwide.
Stellar - Stellar is a platform that connects banks, payments systems, and people. It aims to move money quickly, reliably, and at almost no cost. The Stellar Lumens vs. Ripple XRP is a rivalry that may take decades to bestow a victor, considering they both are working towards fixing the same problem in very different ways. Interestingly, both cryptos were essentially founded by the same guy, Jed McCaleb, the co-founder of XRP and the founder of XLM. However, McCaleb tried to kill Ripple, forked the Ripple code, and rebranded as Stellar. Nowadays, Stellar is more focused on creating new markets. Ripple does state that same objective in their mission statement, but they seem to be focused more on the banking connections. Stellar is working to enable individuals to interact with companies in emerging markets.
Realistically, Stellar has the advantage in the Stellar Lumens-Ripple XRP battle. Once Stellar finally breaks into emerging markets they will steal business away from traditional banks and thereby pull potential profits away from Ripple. And did I forget to mention Stellar’s partnership with IBM? The crypto partnered with the corporate giant IBM on the Hyperledger Fabric Project implementation. IBM is working to create a network of Lumen trading institutions to enable seamless global payments. IBM has their own blockchain, but Stellar has forged their own place alongside IBM to revolutionize blockchain technology through shipping, tracking, and cross-border payments for the near future.
With a portfolio like this, you have the potential to make a killing in the Crypto sector. These are projects I’ve been following for over a year—and they are ready to explode!
This is part 1 of in my mega series of the new crypto-asset class, which is intended for beginner investors. When I first started I foolishly didn’t buy into Neo or Stellar and I missed out on thousand-percent gains (although don’t cry for me because I still did pretty well at the end of today).
Nevertheless, I wish I had an investment guide back when I bought my first crypto. That’s why I decided to create this art live so that some of you out there can Have guidance in this new and confusing world. Once you have the right positions in these tokens, you will then be able to benefit from the second part of this guide to further develop a very strong portfolio in crypto. While I hope you take a look at these picks, DO YOUR OWN RESEARCH, and invest wisely. This should get you started towards MEGA wealth.