We struggled with this one for a little while, and you can’t really blame us: 2019 was a meh year for crypto, and our typical portfolio wouldn’t exactly be the way to go for 2020. Plus, a bunch of new entrants — both projects and categories — caught our eye last year.
Our first question: Does the BRED Portfolio makes sense anymore? Given the fact that Bitcoin had a good year and the others didn’t, does the mix of Bitcoin, Ethereum, Ripple’s XRP, and Dash still give you the kind of portfolio that will propel your crypto investments into the stratosphere?
ALSO, it may not be about the “into the stratosphere” anymore for you. And that’s okay. In any event, we have to figure out if there’s another way to do this.
First Up…How Did BRED Do?
Glad you asked: weird year for sure. Let’s look at the numbers:
So, in the interest of consistency, here’s what the 2020 BRED Portfolio would look like.
However, we don’t think this is the kind of portfolio to focus on for the year(s) ahead. We’ll give a couple reasons why we *think* there’s a rebalancing ahead.
- Bitcoin still makes sense, but Ethereum less so.
- Ripple is working on a ton of partnerships, but hasn’t grown like before.
- Dash didn’t catch fire on the consumer-facing front.
- Way too much else going on.
Let’s Follow the Trends and Create a New Portfolio
Without further ado, here you go: the 2020 Crypto Balance Portfolio.
So, what have we done here?
First Up, MOAR Bitcoin
If a stock went up 90% in a year, would you still want it in your portfolio? Or would you take profits?
Good question, and we address that at least a little by (a) keeping BTC in the portfolio and (b) ratcheting it up to 30% of the overall $10,000.
While I wouldn’t go so far as this commentator who thinks Bitcoin will go to $400,000 after its “halving” (when the mining rewards for Bitcoin are cut in half) in May, Bitcoin has cemented itself as the blue chip of cryptos during the past couple years.
You’ll also see that, in this Crypto Balance portfolio, we’ve ignored the forks. If there are notable forks this year, we can take those into account; but “forkening” isn’t that much of a deal the past couple years.
Ethereum, Still, Has a Role
We’ve done some writing on these pages about projects like Megacryptopolis; you can’t play with any of those NFTs, and you can’t trade any assets on OpenSea without ETH that’s in a Metamask wallet (or some other ETH wallet).
Ethereum is really a two-sided coin (ha!) — with quite a few bearish cases on the internet, and a few bullish ones, too. We think the bullish case outweighs the bearish case, though. We’re keeping it in, but dropping it down to 20%.
About the Other Five…
If our goal is a “balanced” portfolio…uh…what the heck does that mean?
In our case, we achieve some level of balance with the other 5 assets in this portfolio, each at ten percent:
XRP — The coin from Ripple still aims to underpin bank transfers, a la SWIFT. Also, if you still believe in the long-term prospects of the project, under a quarter per coin is not a bad deal at all.
MCO — We lurrve this coin. (That’s a technical term, like HODL.) Not just because you can get some for free just by jumping through a couple of hoops [DISCLOSURE ALERT: AFFILIATE LINKS IN THAT ARTICLE] but because they are doing the regulatory thing correctly. We’re American, and bank laws are pretty important to follow.
EOS — I’ll admit to still being really skeptical, but also see the benefits of owning some EOS as an anti-ETH.
VeChain (VET) — This has potential, thanks to the Toolchain, to be the standard corporate “Blockchain-as-a-Service” solution. Partnerships right and left throughout the world. Tremendously undervalued.
PAX Gold (PAXG) — One really clever idea is to tie the price of a coin to an ounce of gold — so it’s like Tether, but with gold behind it. Also helps the “gold bugs” get into crypto while helping the crypto bugs get into gold.
And…There You Go
Whether this will catch fire like the 2017 edition of BRED or stall like the 2018 edition of BRED or do nothing like the 2019 edition of BRED…all that remains to be seen. But the plan is that we’ll track both all year and see what happens from there.
Stay tuned. 2020 should be interesting.
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