Last year I sold all my Bitcoin, heck it was only eight Bitcoin in total but given that currently it would have been $151,800 today it still stings a bit that I sold it for a measly 2x profit. In an attempt to make up for my previous mistake…and feeling like Bitcoin was too high to buy in the thousands of dollar range (doh!) I decided to do a bit more research on cryptocurrency this summer.
The two cryptocurrencies that stood out to me were Ether and Litecoin. I read a few articles, starting checking out Reddit more regularly, heck I even tried my hand and mining. By no means did I become an expert, but I did walk away from my research feeling like if I missed the boat on Bitcoin, either of these two had a decent chance of making a run for it.
I particularly liked Ether because I believe in the mission behind Ethereum, which I think might get lost in the shuffle amidst all the cryptocurrency hype. Ethereum is actually a distributed computing platform, built on blockchain and allowing for something called a smart contract. I won’t get too into the weeds in this article but if you really want to do a deeper dive into Ethereum and Ether (its corresponding cryptocurrency token) then I recommend this awesome guide from Blockgeeks.
So, after trying to absorb as much as I could this summer, I took the plunge and bought both Ether and Litecoin. At the time Ether was a bit shy of $300 and Litecoin was around $50. Today, just a few months later I’ve seen my Ether investment more than double and Litecoin go up by 5x.
While I’d love to say I was able to so carefully research and time the market that I hit it big on these two cryptocurrencies…the reality is that like most people who made the same move, I was just lucky. What bugs me lately is that people who randomly bought Bitcoin, Ether, Litecoin, etc. and made good money now claim to be experts. While there are of course some real crypto experts out there, I think it’s safe to say that 2017 is minting far too many new so-called “crypto experts.”
A lot of these people did make a lot of money thanks to crypto this year…but they’re confusing good luck with expertise. While I do hope to be able to be more of a technical trader in the future, and yes, like most people out there I’m studying the crypto market more than ever, still it’s important to discern between luck and expertise.
One thing that scares me a bit about writing more and more about crypto on my blog is that people will think, “hey if this guy is writing about cryptocurrency he must be some kind of expert.” So I want to dispel this myth before it starts. That being said, I can honestly say that cryptocurrency is one of the best investments I’ve ever made, period. Of course if it all crashes tomorrow it could be one of the worst, but right now I am absolutely blown away to see how much my investments have grown over the last couple of months.
As a result I’m going to be investing some of my profits into other, riskier cryptocurrencies like Ripple that have a lot more risk and volatility. Still I’m a big believer in taking some percentage of my profits from any high-return investment, and putting it into something that could grow that money even faster. Not all of it, but some of it. I’ve done the same thing with domain names over the last ten years and I’m looking forward to seeing where this adventure takes me.
Of course, as always, I’ll take all of you along for the ride. Yes, I’ll still be writing about domain names here more than anything else but you can definitely expect to see more articles about crypto going forward since I’m getting more active in this space than ever before. Just remember, I’m not an expert, instead I’m someone that got very lucky this year. That being said, I think in many ways you make your own luck, so when you have a windfall or some investment that works out better than expected, it’s what you do with the profits that can really take your investment to the next level.
What do you think? Is re-investing a percentage of my profits a good idea or I am silly for increasing my risk profile and should I instead stay focused on Ether and Litecoin? I want to hear from you – comment and let your voice be heard!