If you're investing in cryptocurrencies and haven't researched 1929 or 1999 and the way the markets acted then you really should just hand your money over to someone else. We've seen all of this before.
We're in the second wave of this industry (there are great posts in this group about the technical wave analysis so I won't try to repeat them).
Second wave theory
- amateurs will buy at the highs (chasing their dreams) and sell at the lows (to pay their bills)
- institutional investors will start to buy large blocks of the most valuable assets (with real tangible value). Or they will issue their own assets (Tezos).
- many of the early ICO companies will start to fail bringing panic and more selling
- prices will bottom and stay stagnate for 6-12 months (we may be in the start of this).
- regulation will change the landscape of the industry to 'protect' people from their own stupidity (say goodbye to the ICO for smaller companies)
Then the third wave will start. This isn't necessarily a good thing. The third wave will bring all time highs and then 80-90% losses in many of the assets.
Third wave theory
- 80 to 90% of all assets will go to zero
- the dominant assets with real tangible value and revenue generating business will survive and then thrive
- the amateur investor will get crushed and jump out
- institutional investors will own 80% plus of the assets
- index funds will take over
This isn't my opinion. This is 1929 and 1999 historical fact. Can't fully predict the timing but we're working on that.
Digital currencies only differ in one core element (which does not bode well for investors). If all digital currencies went to zero tomorrow it would have zero effect on the world economy. A lot of us would be pissed and some would be broke but the world's financial markets wouldn't even blink. We don't employ enough people in this industry to matter (yet).
Fourth wave theory starts with mass adoption and normality to the markets. Thank regulation and scam ICO's for this. You'll invest in coins like you do equities today. No more (or very few) overnight Lambos (as some people like to say).
This shouldn't discourage. This should motivate. If you know the way the markets will act from a macro point of view you can ride the waves. For anyone over the age of 30 this might be the biggest investment trend opportunity you'll see in your lifetime.
Notes
- I was a day trader in the late 90's. I cashed out 90 days before the market crashed and bought a nice house in San Diego (age 20)
- I was a pre IPO investor in Hubspot and GoDaddy (as well as a half dozen other companies)
- I own an index fund of digital currencies with approx 30 different assets (personal fund)
I'm building an index fund in digital currency with an investment group right now. I do NOT claim to be a digital currency expert nor was I an early adopter. I'm a history nerd. I'm building my portfolio now during the second wave with the proper team and controls to take advantage of what's coming.
Educate yourself and you'll profit. Chase Lambos and you'll still be broke when this is over.
Roger Bryan
Digital Currency Index, LLC
https://www.digitalcurrencyindex.io