There is a dangerous crypto habit that will destroy your portfolio if you let it. As much as we try to avoid it, unfortunately, it is something that most crypto investors succumb to sooner or later.
It’s very easy to become too attached to your crypto bags. Especially when you begin buying altcoins on the higher risk curve. Even when all signs are pointing to the project failing, or never being able to reach those gains that you thought were a sure thing. Yet, still you find yourself unable to give in and cut your losses, and instead invest in the winners.
I’ve found myself in that same exact type of situation throughout the years. Investing in projects that I felt could be the next big thing at the time. Only to get stuck in that mindset, not willing to adjust and admit that you bet on the wrong horse.
There were some projects that I was very passionate about that I felt had the potential to be the “big next thing” in crypto. Only to eventually come to the conclusion that even though their price may still appreciate, they will never become what we thought they would.
In the end, I decided to cut my losses and divert those funds back into Bitcoin and Ethereum. In my opinion, the name of the game in crypto is to own as much BTC and ETH as you possibly can. They are the two blue-chip projects in this market and are what everyone should be striving to maximize their holdings in.
I want to stress that the projects that I eliminated from my portfolio may perform well price-wise, in the future. But I am no longer passionate about them.
Litecoin
It can be hard to remember, but for a lengthy period of time, Litecoin had the 2nd largest market cap out of all cryptocurrencies. They coined themselves the silver to Bitcoin’s gold. Something that never really caught on, or was even necessary.
The truth is that Litecoin never really developed into anything of its own merit. Always trying to use Bitcoin to propel itself. The moment that Charles Lee, the founder of Litecoin, sold all of his LTC in 2018. That was the moment that the death blow had been dealt to the blockchain.
While it is still standing, it has underperformed price-wise and is still significantly below the previous all-time high it set last cycle.
Polkadot
Polkadot mainnet launched in early 2020, a period when the future of Ethereum was very questionable. At the time, ETH had yet to upgrade to add staking or even become a proof-of-stake blockchain.
These upgrades were so severely delayed that many began questioning whether Ethereum would actually be able to ever pull it off.
This was a perfect opportunity for Polkadot, led by Gavin Wood, one of the key ETH co-founders who also helped to create Solidity. At the time, the hype around DOT was everywhere, and people thought that Gavin was developing a better version of “ETH” that was about to take over.
However, since then it has been one disappointment after another. The killer app of DOT, Parachains, landed with a thud, and there has been next to no hype for Polkadot recently. Not only that, but it has also severely underperformed price-wise. Currently sitting at a price of under $4, when compared to its previous all-time high of over $50.
Cardano
Cardano seems to be one of the most divisive projects out there. You either love it or hate it.
I began investing in Cardano as a backup plan for if Ethereum’s 2.0 upgrade wasn’t successful in 2019 when it was $0.03. It seemed that ADA had a more than decent chance to be able to take advantage of the opportunity and replace ETH as the dominant smart-contract blockchain.
At first, I was a fan of Charles Hoskinson, the founder of Cardano, who also happened to be a co-founder of Ethereum. He was convincing and was clearly a very smart individual. I did appreciate the fact that everything was well-researched before being implemented. They wanted to do it the correct way.
However, the cryptocurrency market is a place that moves at a million miles per second, with technology always improving. This is a market where you can’t afford to get left behind. It has the attention span of a fly, easily forgotten.
Charles continues to talk about all of these “partnerships” he has, but as time goes on, you begin to catch on to the trend that it is simply talk. He is a car salesman, and you are his target. At least that is the impression I’ve always gotten. The adoption of ADA simply hasn’t lived up to expectations and will eventually be forgotten. I still did very well with this project, selling it when it was nearly $2 and once again put that toward more BTC.
Internet Computer
ICP was one of the projects that I unfortunately became too attached to over the years. It has arguably the greatest tech in the cryptocurrency market, but seemingly no adoption at all.
If no one is around to hear a tree fall down in the forest, does it still make a sound?
It doesn’t matter if you have the greatest technology for a blockchain if so few people are using it.
I began investing in ICP toward the end of the last cycle when it had fallen all the way down to $3.50. I felt that since it was so far down, there was a real opportunity to make money. Even more so if it could gain more adoption.
Unfortunately, as time went on, both the price and adoption were lacking, and I decided to cut ties and strengthen my ETH and BTC positions even further.
Solana
Without a doubt, Solana being on my list will be the most controversial of them all.
I began investing in SOL at the perfect time, right after the FTX fraud, when it was at its lowest price at $10. My thesis was that it had a passionate community and that there was money to be made that could later strengthen my BTC & ETH positions even further.
It also served as another backup plan just in case Ethereum failed.
However, I have been extremely pleased with the recent change in the ETH developers’ focus, and that has eliminated most of my doubts about that project.
At the end of the day, the inflation rate continues to be a large problem with SOL. While the high-staking rate initially seems great, at most you are just staying even with the dilution of the network. Along with that, its decentralization remains less than ideal. But the key thing of note is that some of Solana’s killer features are arguably being performed better by new rivals. Competitors such as Hyperliquid.
Right now, the biggest thing happening on Solana has been meme coins, something that I have no interest in participating in. Instead, I decided to divert my SOL into more Ethereum.
Everyone knows that to be a successful investor, you must be able to correctly choose the winning projects to devote capital to. However, far too many people overlook the importance of being able to cut your losers and devote that capital to better projects.
How about you? Which crypto projects have you eliminated from your portfolio over the years?
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As always, thank you for reading!
