In the last month (12/8 to 1/3), the Bitcoin market cap has declined from it’s peak of 67% to 37%, while alternative coins such as Ripple have grown from 2% to 14% total market share.
What’s also interesting, is while the top 10 alternate currencies have gained substantially, the bigger story in my opinion is the smaller “startup” alt-coins, also known as the ICO market – “Initial Coin Offering.” There are now more than 1,300 alt-coins listed on coinmarketcap.com, and they have gained from 10% in the last 30 days, capturing almost 20% of the total market cap! (see the “Others” white line in the graphic above). New coins are added each week.
Here is an article from CNBC that explains how to invest in Alt-coins such as Ripple. (click here).
Note: If you are going to invest in alt-coins, use the mainstream exchanges such as Binance, Gdax and Bittrex (when they start accepting new users) because there are many ‘fly by night’ exchanges out there that can only be accessed through TOR. It’s tempting since these exchanges are listing the biggest gainers right now (1,000% increase in profit over 7 days according to coinmarketcap.com). Many of these exchanges don’t accept currency directly so you’ll have to start off with a site such as Coinbase, and then transfer the funds from there into other exchanges. Another reason to use mainstream exchanges is they offer Tax reports. Otherwise you would have to manually record your gains and losses, which is labor intensive to track since you would have to record the value of the digital currency at the time of the trade. So by using mainstream exchanges, you can benefit from their tax reporting features. Check your exchange (your mileage will vary).
So is too late to invest in cryptocurrencies and other blockchain technology companies?
“The short answer is no, as long as you don’t think the crypto bubble will burst in the near future. However given the trends of the past 48 hours, it’s necessary to invest with great caution. If you’re looking to make a quick million by jumping on the cryptocurrency bandwagon right now, understand that you’re playing with fire. Nevertheless, even with the dip in value of cryptocurrencies in the past two days, there are plenty of undervalued cryptocurrencies that are designed with newly-developed advancements in blockchain technology. If you do invest, it’s worth spending the time to understand the technology and who is developing it – just like investing in a tech stock.”
As a side note, I do think that the Cryptocurrency market is a bubble driven by wild speculation, that will eventually crash. So the best advice is to not invest any money into it that you cannot afford to lose.