It's not debatable any more at this point, any crypto that has anything to do with DeFi has been seeing Bull Market type daily/weekly gains. Some of these DeFi coins are up hundreds of percent when using the weekly and monthly charts. At this point it seems that you can make gains just by picking any DeFi coin and investing in it. It isn't only relegated to DeFi coins any longer, but also many altcoins have been surging as well. Perhaps Altcoin Season has begun. So have you joined the DeFi hype train, or have you been watching it drive away without you?
Let's dig into this more.
(This article is based only on my own opinions, and isn't financial advice, please be sure to do your own research before investing with your hard-earned money.)
It is looking more and more that this bull market will be kickstarted by all the DeFi hype movements that have been happening recently. But with all those great movements, the two giants of the crypto market; Bitcoin and Ethereum, have yet to do anything. In fact, if you like to live dangerously now could be an amazing chance to multiply your portfolio by investing in those altcoins and either cashing out, or reinvesting profits back into bitcoin and ethereum.
Just this week we have seen Chainlink surge to new all-time highs of around $8.50, before the pull-back eventually brought back down the price. But it did reach all-time highs, something that hasn't been achieved much at all since the last bull run.
Now with the DeFi craze happening, why is Chainlink pumping, but Ethereum isn't?
I came across an explanation the other day that made a lot of sense to me so I wanted to share it. Yes, most of DeFi does use Ethereum, even Chainlink does. But Ethereum is like a large retail unit, it doesn't matter who the tenet is that is renting the building, it could be Apple or Amazon or a convenient store, but Ethereum would charge the same rent. But it does matter to the party inside the unit that is renting. They are the one that is running the business, powering it, and making the money. After I read that, I began to understand better why Ethereum's price hasn't been moving.
During the next bull run, we will definitely be seeing a large pump to the price of both bitcoin and also Ethereum, but at the same time it is also very likely it won't match the gains of other altcoins in terms of percentage.
So now it is time to make one of those big decisions that could really have long lasting implications for your portfolio. Will you be sticking to the more tried and true cryptos, the coins in the top 10 market cap, especially bitcoin and ethereum.
Or will you be taking risks, investing in other coins trying to multiply what you have.
If you haven't noticed, the DeFi market is like a train, and the train is just about to leave the station, and we need to decide if we will be stepping on aboard, or waiting until it is too late. Later it will still be possible to make profits, but now is the time to jump in. Well actually a few weeks would have been even better.
My strategy.
This is what I decided to do, and please keep in mind this is only my approach, please do your own research. Thankfully last year I had done a lot of research and determined that DeFi was "The Next Thing" to take the crypto world by storm. So I began regularly investing in Chainlink, Kyber Network, KAVA, and a few others. While I still want more, I am quite satisfied with the bag that I do have. I do fully believe Bitcoin and Ethereum will be here to stay in the market, and is something that everyone should be invested in. In the past my weekly spending went as follows; bitcoin 60%, ethereum 25%, DeFi/Altcoins 15%.
During the last few weeks I have changed to bitcoin 50%, ethereum 15%, DeFi/Alts 35%. Hopefully I am lucky and make profits where I would then swap those for more Bitcoin and Ethereum.
So what is your approach?
Have you jumped aboard the DeFi/Altcoin movement, or are you sitting on the sidelines and wanting to wait and see just a little longer?
As always, thank you for reading!