The Altcoin Experiment

Trying my hand at investing in altcoins…

Since investing in Bitcoin, I have been inundated on my x.com (Twitter) account with others talking about meme coins & altcoins.

Like any other investor, whenever I see someone else earning a great profit from a very little investment, I start to wonder if I could do the same thing…enter the FOMO…

• Thus this “Altcoin experiment”…

In this article, I’ll discuss some of the risks associated with investing in Altcoins, my strategy, & how it has worked so far.

(I will not get into very much detail for each coin because I’m learning as well & don’t want to lead others in the wrong direction. DYOR. NFA. Invest only what you are willing to lose. Your strategy & result may differ from mine.)

If you want to see all the projects I’m currently active in, read my referral article below.

What are Altcoins?

Simply put Altcoins are other Cryptocurrencies besides the regular coins, like Bitcoin & Ethereum.

These can be very common tokens such as Binance (BNB), Polygon (MATIC), USDC, USDT, & many others. Most Altcoins are forks (modified copies) of BTC & ETH. There are thousands of altcoins out there, with more being created all the time.

They can do a very specific function, serve as a very specific Dapp token, or just a speculative coin.

Here is a list of some common Altcoins, just to name a few:

• Binance (BNB)
• Polygon (MATIC)
• XRP Ledger (XRP)
• The Graph (GRT)
• Polkadot (DOT)
• Solana (SOL)

I currently own/use BNB, USDC, & Matic often. So now, I’ll diversify some & try my hand at other altcoins too.

Rewards associated with Altcoins

As with any investment, there are risks & rewards.

The price of these altcoins can be very volatile & move very quickly. This means that you can make a lot of profit very quickly & you can lose a lot of profit very quickly. They can also move very slowly, requiring a lot of patience waiting for them to reach the target price.

Let’s look at the Bonk token for example. It has gained a lot of attention recently.

As you can see in the screenshot above, the BONK price quickly went up & then back down again in mid-December. It is currently down 13.10% for the last 24 hours, as of the time of this writing.

If you had bought this token on 11/11/23 then you would have had a more than 600% increase.

• So a $100 investment at that time would equal around $657!!!
• A $1,000 investment at that time would grown to $6,570!

That’s a pretty good profit. You would have had to wait around 6 weeks for that profit.

• Imagine how long you would have to wait if you bought on the launch date, 12/25/22…

Risks associated with Altcoins

So there is a lot of profit to be made with these altcoins but there is also risk.

Now let’s suppose that you found out about this BONK coin, thought that it was “going to the moon”, & decided to invest $100 on 12/13/23.

• The price on 12/13/23 was around $0.00001496 per token. You would have gotten around 6,684,491.98 tokens.
• This would give you a profit of around $7 with today’s prices. Still in profit but not by much.

What would have happened if you would have invested on 12/14/23, only one day later?

• The price on 12/14/23 went up to $0.00003457. A $100 investment would have gotten you around 2,892,681.52 tokens. This is a lot less than the previous example.
• Those tokens would now be worth around $46.34 at today’s prices, a loss of $53.66!!! (Ouch!)

If you had invested $1,000 then that would have been a loss of more than $530!!

What is my Strategy?

With these risks, I want to deal with “house money” as much as possible. So I’ll need a good exit strategy for when the token makes a profit & when it takes a dip.

• I’m still a small investor. So I’m not going to invest a large amount into these tokens at this time. I’ll grow my investments as my profits grow.

This is how I’m playing the Altcoin game.

1. Only invest in tokens that are recommended by several sources (Twitter, Telegram, Youtube, etc.). Spread the investments into different sectors such as AI, RWA, Gamefi, Privacy, Defi, etc.
2. Only invest around $10 at a time into each token.
3. Selling all of those particular tokens if the price falls below 75% of my investment price.
4. Selling around $10 worth of those tokens if the price goes above 175% of my investment price. Any extra earnings are profit.
5. Only initially invest in a maximum of 10 tokens, which should limit my exposure to around $100 of my own money. Once I get my initial investment back then I can start investing that $10 into more altcoins, growing my investment pool.
6. After getting my initial investment back, continue to HODL the original token until it falls to 75% of the highest peak then sell all my holdings, getting as much profit as possible.
7. Repeat steps 1 through 6 gradually increasing profits along the way.

How has it worked for me so far?

So I started experimenting with these tokens on 12/20/23, only 7 days ago. This is not a very long time & it looks like I have some potential profit.

I’ve only invested in 8 tokens at the moment.

Here’s how it has gone so far…

1. 12/20/23 — Bought $10 of SOL when it was priced at $80.92. Today’s price is $112.48, which gives e a profit of $3.55.
2. 12/21/23 — Bought $10 of ROSE when its price was $0.10. Today’s price is $0.13, which gives me a profit of $2.43.
3. 12/23/23 — Bought $10 of FHT when its price was $0.001199. Today’s price is $0.001257, which gives me a loss of $0.008, due to 6% slippage.
4. 12/24/23 — Bought $10 of INJ when its price was $40.33. Today’s price is $39.07, which gives me a loss of $0.59.
5. 12/24/23 — Bought $10 of LINK when its price was $15.44. Today’s price is $15.51, which gives me a loss of $0.23, due to slippage.
6. 12/24/23 — Bought $9.38 of MATIC when its price was $0.85. Today’s price is $1.08, which gives me a profit of $2.17.
7. 12/26/23 — Bought $10 of CAKE when its price was $3.68. Today’s price is $3.58, which gives me a loss of $0.14.
8. 12/26/23 — Bought $10 of CHZ when its price was $0.09. Today’s price is $0.0932, which gives me a profit of $0.12.

Total invested = $79.40.

Total value = $86.70.

Total potential profit (gains-losses) = $7.30!

I haven’t made enough from any individual token in order to take out my initial $10 investment yet.

So I wait…

…Time in the market usually wins over Timing in the market…

Till next time.

God Speed!

(NONE OF WHAT I WRITE IN MY ARTICLES IS TO BE TAKEN AS FINANCIAL OR INVESTMENT ADVICE. It is primarily a record of what I am doing, and the different strategies I’m using to reach ROI, & make a profit in Defi. I am not an advisor nor am I suggesting any financial action on your part. Invest at your own risk. DO NOT INVEST MORE THAN YOU ARE WILLING TO LOSE! DYOR. NFA.)