Buying Altcoins over Bitcoin: A good choice?
Hey! If you are reading this as an active cryptocurrency and blockchain technology enthusiast, then it’s no news that you are in one of the vastest and most dynamic space. Tons of luring projects float over this space and it’s very easy to lose your focus just staring at them…uhm, staring at the charts actually. Bitcoin’s price has tumbled over three times since the last quarter of 2020 and has breached the $41,000 price point. Bitcoin maximalists must be well delighted with the state of things since this time.
Bitcoin rallies, taking ethereum along in the shuttle, and a couple other altcoins. Despite this, most altcoins haven’t really seen much of the green as most of them are stuck in recovery. Altcoin maximalists must be seriously reviewing their life choices…lol
The word ‘altcoin’; or better said, ‘shitcoin’ has been modified over the years to depict inferiority to the ‘alpha’ cryptocurrency — bitcoin. Altcoins rarely enjoy the limelight, something bitcoin enjoys without breaking a sweat. Being the first generally known cryptocurrency and catching the eye of institutions and elite financial speculators have really skyrocketed the financial fate of bitcoin.
Despite obvious technological advantage of many altcoins over bitcoin, it has continued the steal the global attention and being a ‘store of value’ has never proven to be so important. Anyways, the uptrend continues and things are continuing to stay green.
Hitting the market amidst these recent developments, an investor might be stuck trying to decide a better investment between altcoins and bitcoin. Well, I’d think twice too. Bitcoin is currently more volatile than it ever was, speculators and traders are aware of the possibilities of price going either way. A crash or a boom? Fact is, everything is currently on a tipping point…as always.
Regardless of the financial status of every investor, the common goal is to gain maximum profit and suffer the very minimum loss. If the reverse is the case for you, then you are probably buying high and selling low…lol
Watching the one year price trend, bitcoin has tumbled over 4 times to reach its maximum price point over the years. A $100 investment in bitcoin on January 2020 would worth over $400 at the highest price over this time interval. While many altcoins can’t boast of a better performance over this time interval; for a very good number of altcoins, a 4x gain is paltry.
Now, that might actually sound very enticing, but it doesn’t come without huge caveats. Loopring (LRC) has tumbled over twenty (20) times to hit a high of over $0.5 from its lowest annual price of about $0.02. Theta have also taken a similar route to peak at over $2. Relatively, bitcoins 4x gains would look negligible; however, majority of altcoins have recorded worse returns with most plunging to incredible losses.
For an investor who is more concerned about averting grave financial losses, bitcoin is unarguably a safer investment. Bitcoin’s price has shown more inertia than altcoin prices. A 30% daily loss in bitcoin is a rare story. For altcoins however, this is very normal. Investment in bitcoin is unarguably safer and less nerve breaking. Probably why ‘institutions are buying bitcoin’ over altcoins despite the fact that altcoins are obviously more advanced than bitcoin…all round.
For an adventurous investor with the risk-taking nerve, for an investor who dares to take the risk and damn any consequences, for an investor who is more concerned about making face melting profits and ready to risk his investments for it, then investing in that altcoin is a better choice to make. Moving from a few cents to a few dollars has been a popular tale of successful altcoin projects. Altcoin prices form the story of volatility in crypto space. More rewards, more risks. Even a well diversified altcoin investor still stands a good chance of losing out. However, when successful, altcoin investments could be life-changing.
‘Bitcoin bring 5x gains, altcoins bring 100x gains’, but this 100x could also go the other way. Cryptocurrency investment is a risky adventure, but while investing in bitcoin is risky, investing in altcoins is way riskier. And while crypto investments are profitable, altcoin investments are life-changing.
Two choices, each with equitable merits and demerits. Conditions would determine the better choice for any investor. Shitcoins are named so for a reason, but they could also turn out to be a real fortune. Bitcoin is a bit safer, but get ready to move slower.
