Bitcoin is a safe bet when selecting a cryptocurrency portfolio; this digital coin has earned its place as the go-to crypto in terms of popularity and recognition among investors worldwide. Bitcoin’s name has become an emblem for the industry while its price can serve as a measure for how investors perceive overall market conditions. When considering which cryptocurrencies to invest in 2021, BTC should form part of your core cryptocurrency investment strategy.
However, selecting the ideal cryptocurrency investments requires considering several key criteria. A key question when choosing an investment project is if its aim meets an unmet need in the cryptosphere; some cryptocurrencies might simply be created as trends or ride the hype wave; others have proven business models and teams which make them well-suited for long-term investments such as Synthetix that offers tokenized assets including cryptos as well as stocks, precious metals and other financial assets such as Synthetix tokens based on these assets – yet others merely create such projects without fulfilling this need – yet others offer long term investments based on solid business models and teams as they come up.
Consider how much competition a crypto has, which could impede its long-term performance. Do your research on any specific digital currency by checking how the price has fluctuated over time and reviewing its technical specs.
As shown by the table below, multiple digital coins have seen gains of over 1000% this year. This includes several crypto exchange tokens (CET), gamification and metaverse tokens, blockchain-based digital collectibles and non-fungible tokens (NFTs), as well as several decentralised finance projects.
Rule of thumb suggests allocating only a small proportion of your portfolio to cryptocurrency investments, due to their inherently unpredictable price movements and risk-adjusted returns if chosen wisely. Many asset managers and investors have begun diversifying with some exposure to cryptocurrencies in their portfolios; Coinhouse experts have chosen the top 10 cryptocurrency investments for 2021 from CoinMarketCap data so you can be confident with your choices.