Metacoin

Covering Bitcoin, the Blockchain, Altcoins, and Fintech

DeFi Kingdoms

Wait, Could You Have Doubled Your Money?

If you slept through 2023, you might have missed what amounted to a #CryptoComeback.

We thought we’d head to the “Crypto Flavorizing Machine,” otherwise known as ChatGPT, and ask about our 2023 Growth Portfolio — which you can read about at this non-ChatGPT post from Dave — and whether it’s got the goods going forward.

Also, this was a good chance to check on the abilities of the machine. Here goes:

The Evolution and Future of a Diverse Crypto Portfolio

As 2023 unfolds, the cryptocurrency market remains as dynamic as ever. Investors who equally diversified their portfolio at the year’s start with ten notable assets — Bitcoin ($BTC), Ethereum ($ETH), DeFi Kingdoms ($JEWEL), Avalanche ($AVAX), Crypto.com Coin ($CRO), Treasure ($MAGIC), SushiSwap ($SUSHI), Shiba Inu ($SHIB), Spell Token ($SPELL), and Ethereum Name Service ($ENS) — have witnessed a rollercoaster of trends and shifts.

Bitcoin ($BTC) and Ethereum ($ETH): These giants continue to dominate the market. BTC, as the pioneer, often dictates market sentiment, while ETH’s transition to Ethereum 2.0 has kept investors on their toes.

DeFi Tokens ($JEWEL, $SUSHI, $SPELL): These assets, linked to decentralized finance platforms, have seen varied performances, heavily influenced by the broader DeFi market trends and technological advancements.

Layer 1 Networks ($AVAX, $ENS): Avalanche and Ethereum Name Service represent the growing interest in alternative layer 1 solutions. They’ve been pivotal in discussions about scalability and blockchain utility.

Meme Coins ($SHIB): Shiba Inu, despite its meme coin status, has a dedicated community. Its value often moves on social media sentiment rather than fundamental analysis.

Niche Picks ($CRO, $MAGIC): Crypto.com Coin and Treasure have carved their niches — CRO in the crypto exchange space and MAGIC in the NFT and gaming sectors.

Looking ahead to the next year, several factors could influence these assets:

  1. Regulatory Environment: Increasing regulatory scrutiny, especially in major economies, could significantly impact these assets’ performance.
  2. Technological Advancements: For Ethereum and Avalanche, how they scale and improve will be crucial.
  3. Market Sentiment: Overall investor sentiment, often swayed by macroeconomic factors like inflation rates and geopolitical tensions, will continue to be a key driver.
  4. Community and Ecosystem Developments: For coins like SHIB, JEWEL, and MAGIC, the strength and engagement of their respective communities and ecosystems will be pivotal.
  5. Global Adoption: The pace of crypto adoption by mainstream finance and the general public could bring more stability and growth.

Disclaimer: Cryptocurrency investments are highly speculative and volatile. This analysis is for informational purposes only and should not be considered financial advice. Investors should do their due diligence and consider their risk tolerance before investing in cryptocurrencies.

This analysis provides an overview of each asset’s current standing and potential future directions, considering various market dynamics. Remember, the crypto market is unpredictable, and past performance is not indicative of future results.

Now, Back to the Human Analysis

“Past performance is not indicative of future results” but the past performance of our 10 picks in the Growth Portfolio has been pretty strong. To wit:

Those three are the top performers. Avalanche has tripled. Bitcoin is up 2 1/2 times, and DeFi Kingdoms has doubled. (Okay, they all dropped crazy amounts toward the end of 2022.)

The whole thing? Up 76 percent in 2023.

The message? Well, diversify might be part of it.

And the answer to the above question: “Could You Have Doubled Your Money?” Yes, had you bought Bitcoin. Or Avalanche. Or DeFi Kingdoms.

Funny thing, this crypto.

The 2022 Crypto Growth Portfolio

It started with a tweet, shared in response to an epic Twitter thread.

First, the thread:

Then, my tweet:

The thread from Adam is LONG, so you’ll need to devote some serious time to studying it, or you’ll want to keep referring back to it a little at a time (that’s my plan; Adam shares some great info but it wasn’t until one of my Twitter friends referred to a specific recommendation when I started reading chunks in detail).

My tweet, however, was meant to start some conversations around a simpler potential portfolio you could put together to play this new new new NEW economy of web3 and whatever else is going on.

We present our 2022 Growth Portfolio in the same spirit as past HYPOTHETICAL portfolios: Do Your Own Research, Not Investment Advice, and, well, here’s an interesting way to track what’s going on in Crypto.

What’s Here (vs. What Was in the Tweet)

Caveats first: I made a couple changes to the December 30 post; I decided, to be direct, that $UNI and $CRV didn’t fit with the portfolio. So $AVAX and $SUSHI were inserted instead. The “Rank” column on the left-hand side is taken from this morning and all prices (both 1/1/22 and 1/5/22) were from CoinGecko.com.

Also, I created the list, did the whole price thing, and then…”#BitcoinCrash” or whatever, the afternoon of January 5. So I had to recalibrate based on pricing the afternoon of the 5th. (Hopefully the bloodbath is over.)

The idea goes like this: take a hypothetical $10,000 investment and divide it equally among ten coins. Past portfolios used fewer coins (BRED used just 4) but this might be the best way to spread the risk.

Bitcoin and Ethereum

The first two choices may be obvious: Bitcoin ($BTC) at nearly $900m at this writing and Ethereum ($ETH) at $400+m right now are the Big Two; third-place (by market cap) coin $BNB is 1/4 the size of $ETH. Bitcoin may or may not BE the crypto market, but a coin that is 1/3 the size (roughly) of Apple is probably a force to be reckoned with.

Ethereum is rather formidable in its own right, and, for the purposes of having an entry point into the rest of the coins through something like Metamask, you want some $ETH.

(SIDEBAR: Metamask has ONLY 21 million users? You want to get some $ETH and start using Metamask *if only* for the possibility of an airdrop, a la $ENS.)

Avalanche

Avalanche ($AVAX) traded at (GASP) $3.67 on January 1, 2021. So it’s up nearly 30x in one calendar year. Is it done?

We don’t think so; of course we’re kicking ourselves for being late to the party but it, as a platform, is pretty stellar and may have plenty of room to grow. (Could it pull back? Yes. $24B market cap might seem a little pricey. But $100B isn’t out of the realm and, let’s be honest, if you could 4x a piece of your portfolio, you’d probably be willing to risk a little.

Shiba Inu

Yes, we’ve seen the stories about the kid somewhere who invested a few hundred dollars in Shiba Inu ($SHIB) and now owns his own island. This one, for us, is the last of the famous international meme coins. You’re speculating that there’s a chance the $SHIB community can get this thing to a tenth of a penny, which would mean roughly 30x growth from here. (It would also mean that its value dwarfs the current value of $ETH, so yeah that’s a tall order.)

Realistically, though, expect a couple more bullish cycles of this highly volatile meme coin. Worth taking a chance on.

Crypto.com

You can’t go anywhere without seeing BRAND SPONSORSHIPS IN CRYPTO. FTX has an arena, as does Crypto.com; Crypto.com has Matt Damon, so advantage $CRO, its coin.

AND HERE’S A CLEARLY MARKED AFFILIATE LINK: We can both get a little something if you use this link and sign up and make a qualifying purchase.

This is probably the best way to play “pure retail crypto,” if that’s what you call a brand that pays big bucks to have Matt Damon on board.

Sushi

We pulled out Uniswap specifically and replaced it with Sushi ($SUSHI). We like the platform better and, while Sushi has ebbed and flowed and zigged and zagged — $3.32 on 1/1/21, then a high of $23.38 in March of 2021, and today at $7.76 — its one-stop-shop of Pooling and Staking and Farming is pretty nifty.

DeFi Kingdoms

$JEWEL is the token behind DeFi Kingdoms, which our buddy @TxdoHawk on Twitter talked about yesterday.

If you’re playing the DeFi-meets-Gaming-meets-NFTs space, there are worse places to do so.

Ethereum Name Service

$ENS is the governance token behind the Ethereum Name Service, and it was airdropped in November to users; we did a deeper dive on the site a couple weeks back. We still like it a ton.

Treasure

We talked about this one yesterday, too; $MAGIC is the coin and it is on a roller coaster this year already. (And today, dropping from an all-time high of $4.75 to its current level at $3.61 a token.)

The part above about DeFi Kingdoms playing the intersection of a couple of categories applies here: $MAGIC could very well be a ten-bagger this year (and that would put it just above $1B market cap).

What’s Next?

We plan, as we did in past years with the BRED Portfolio, to keep tabs on this one, with an update at least at the beginning of each quarter. It should be fascinating to see unfold.

‘Not Investment Advice’ — What To Do with $1000 Right Now

So we’re starting an occasional series here called “Not Investment Advice.” We’re reaching out to a few people — in the Bitcorn universe and in other financial worlds — and we’re asking them: “What would you do with $1000 right now?”

This is, as we say in the headline and in the first paragraph here, “Not Investment Advice.”

Our first contestant is my buddy Mike on Twitter (his handle is @TxdoHawk) and below are his thoughts. As the days progress, we’ll add more comments from more commentators.

Mike (@TxdoHawk) Says:

DeFi Kingdoms (JEWEL) – There’s been a lot of discussion of blockchain gaming, Play 2 Earn, and the like in the back half of 2021. Studio after studio have launched flashy 3D trailers promising epic universes to explore. But in the meantime, DeFi Kingdoms has been quietly building out their vision: A gamified decentralized exchange that’s a love letter to a simpler time of 2D, 16-bit RPGs.

I have two rules when it comes to these sorts of investments. One, bet on teams, not projects; it’s clear the DeFi Kingdoms team has put a lot of careful thought into building out their universe. One only has to attend one of their weekly AMAs to get a real sense that this is a group serious about what they do and how they execute. Everything is thought through, the fledgling economy is carefully considered even at these early stages, and they are truly excited to share their ideas with the world.

Rule two is “one line of shipped code is worth more than a hundred roadmap promises.” Here again the team has excelled: In the 4 months since launch they have launched their DEX, hero NFTs that can earn experience and stat boosts, along with the beginnings of questing and the basics of an RPG-style economy where quest rewards can be earned, as well as bought/sold.

Skeptics might point out that the real meat of the game has yet to arrive: Major items on the to-do list are the remaining basic profession quests, along with lands (and their mechanics) as well as a PvP combat system. But what this team has already launched still dwarfs most projects in the space, many that have little more than a hype video and outstretched hands begging for investments.

The easiest way by far to get a foothold in this world is via the liquidity farms, referred to as Gardens. You can be earning JEWEL in a matter of minutes with no further effort required, and the APYs are still generous to this day, although a good chunk of that will be “locked” and released over a further out timeline. But think of that locked JEWEL as a generous call option: by the time you get your grubby paws on it, it could very well be that DeFi Kingdoms has built out one hell of a thriving ecosystem, especially with the newly-announced Crystalvale expansion coming to the Avalanche network.

Dave from Metacoin (That’s Me!) (@TeamMetacoin) Says:

I continue to be in awe of what they’re building at $MAGIC, whose website is Treasure.lol. Really. They have a “dot-lol” web domain.

And this is just from an investor standpoint, as I have yet to ACTUALLY PLAY THE GAME. (What’s Warren Buffett’s line about “investing in what you understand?”)

What I *do* understand is the convergence of NFTs (yes, I’ve created them and bought a bunch), DeFi (been there, done that), and gaming (duh).

They have the “slick video” going for them — but, to Mike’s point above, rather have delivered code, so the jury is still out on all of it — as referenced here:

This one is out of the “better lucky than good” dept. See chart below.

To be honest, this one was part of my “let’s speculate on a couple assets” plan toward the end of 2021. Others may not have done as well; $SPELL and $AVAX each doubled for me (thanks to good timing) but aren’t up multiples like my $MAGIC bet.

Whether the sky is the limit or not is a whole other question. But, and again THIS IS NOT INVESTMENT ADVICE, $MAGIC could be an interesting one to watch in the months to come.