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Four Year Report – UP 34%
Welcome to the four year report!
The 2018 Top Ten Crypto Index Fund Portfolio is BTC, XRP, ETH, BCH, ADA, LTC, IOTA, NEM, Dash, and Stellar.
December highlights for the 2018 Top Ten Portfolio:
- 100% red month. IOTA falls the least, only down -4% (on news that staking on the Firefly wallet will yield two cryptos, Assembly and Shimmer).
- ETH maintains a solid overall lead, BTC in second place, ADA in third. Three coins in the green since January 2018.
- After four years, the 2018 Portfolio is +34%, behind the S&P 500’s ROI over the same time period.
December Ranking and Dropouts
Here’s a look at the movement in ranks since January 2018:
Top Ten dropouts since January 2018: After four years of the 2018 Top Ten Experiment, only 40% of the cryptos that started in the Top Ten have remained. NEM, Dash, Stellar, Bitcoin Cash, IOTA, and Litecoin have been replaced by Binance Coin, Tether, DOT, SOL, LUNA, and USDC. NEM looks like it wants to be the first to drop out of the Top 100.
December Winners and Losers
December Winners – IOTA outperformed the pack, dropping only -4% this month. 100% of the cryptos in the red.
December Losers – Losing nearly a third of its value, Litecoin fell the most, down -30%. NEM followed LTC, dropping -27% in December.
Tally of Monthly Winners and Losers
After four years, here’s a tally of the monthly winners and losers over the life of the 2018 Top Ten Experiment.
With 11, Bitcoin has two more monthly wins than second place Cardano. NEM has finished last place most often (12 months out of 48).
Bitcoin is still the only cryptocurrency that hasn’t yet lost a month since January 2018 (although it has come very close a couple of times).
Overall Update – 2021 ends with a whimper. After four years, ETH in first place, and Dash and NEM tied for worst overall performance.
After reaching an All Time High (+72%) in October, the 2018 Top Ten Portfolio continued to lose value. After four years of holding these cryptos, only 3 out of the 10 cryptos are in the green: BTC, ETH, and ADA.
Overall, first place ETH (+413%) is well ahead of BTC (+257%) and third place ADA (+99%).
The initial $100 invested in first place ETH four years ago? It’s worth $515 today.
DASH and NEM are virtually tied at the bottom, both down over -86% since January 2018. The initial $100 invested in each four ago is worth about $13 today.
Total Market Cap for the entire cryptocurrency sector:
End of December 2021 market cap: $2,211,626,655,207
The total crypto market dropped significantly in December. Crypto as a sector is still up +285% since January 2018.
There was no easy way to achieve this at the time, but if you were able to capture the entire crypto market since New Year’s Day 2018, you’d be doing much, much better than the Experiment’s Top Ten approach (+34%), the return of the S&P (+78%) over the same period of time, and nine of the individual cryptos within the 2018 Top Ten (except for Ethereum).
Crypto Market Cap Low Point in the 2018 Top Ten Crypto Index Experiment: $114B in January 2019.
Crypto Market Cap High Point in the 2018 Top Ten Crypto Index Experiment: $2.65T in October 2021.
BitDom declined a bit in December, ending the month at 40.2%. When looking at the entire four year 2018 Experiment time frame, BTC dominance is near the low end. For context:
Low Point in the 2018 Top Ten Crypto Index Experiment: 33% in January 2018.
High Point in the 2018 Top Ten Crypto Index Experiment: 70.5% in August 2019.
Overall return on $1,000 investment since January 1st, 2018:
The 2018 Top Ten Portfolio lost $325 in December.
If I decided to cash out the 2018 Top Ten Experiment today, the $1000 initial investment would be worth $1,341, up 34% from January 2018.
Green is unfamiliar territory for the 2018 Top Ten Portfolio and a recent development. Over the first four years of the 2018 Index Fund Experiment, thirty-eight months have been in the red, with only ten months of green. And all ten of the green months have come in 2021.
Here’s a look at the ROI over the life of the experiment, month by month, since the beginning of the 2018 Experiment four years ago:
Remember: no one can predict the value of any crypto tomorrow, let alone next month or next year. The 2018 Top Ten Crypto Portfolio was down -88% after one year, -80% after two years, -25% after three years.
Combining the 2018, 2019, 2020, and 2021 Top Ten Crypto Portfolios
Alright, that’s that for the 2018 Top Ten Crypto Index Fund Experiment recap.
But I didn’t stop the Experiment in 2018: I invested another $1000 in the 2019, 2020, and 2021 Top Ten Cryptos as well ((and, just announced, again in 2022!). How are the other Crypto Index Fund Experiments doing?
- 2018 Top Ten Experiment: up +34% (total value $1,341)
- 2019 Top Ten Experiment: up +504% (total value $6,044)
- 2020 Top Ten Experiment: up +795% (total value $8,951)
- 2021 Top Ten Experiment: up +292% (total value $3,921)
So overall? Taking the four portfolios together, here’s the bottom bottom bottom bottom line:
After a $4,000 investment in the 2018, 2019, 2020, and 2021 Top Ten Cryptocurrencies, the combined portfolios are worth $20,257 ($1,341 + $6,044 + $8,951 + $3,921).
That’s up +406% on the combined portfolios, down from last month’s all time high for the combined Top Ten Index Fund Experiments. Here’s the combined monthly ROI since I started tracking the metric in January 2020:
That’s a +406% gain by investing $1k in whichever cryptos happened to be in the Top Ten on January 1st (including stablecoins) for four years in a row.
Comparison to S&P 500:
I’m also tracking the S&P 500 as part of the Experiment to have a comparison point with other popular investments options.
After four years: the S&P 500 is up +78% since January 2018, so the initial $1k investment into crypto on January 1st, 2018 would be worth $1,780 had it been redirected to the S&P. That’s more than double the +34% return of the 2018 Top Ten Crypto Portfolio over the same period of time.
Taking the same invest-$1,000-on-January-1st-of-each-year approach with the S&P 500 that I’ve been documenting through the Top Ten Crypto Experiments, the yields are the following:
- $1000 investment in S&P 500 on January 1st, 2018 = $1,780 today
- $1000 investment in S&P 500 on January 1st, 2019 = $1,900 today
- $1000 investment in S&P 500 on January 1st, 2020 = $1,480 today
- $1000 investment in S&P 500 on January 1st, 2021 = $1,270 today
Taken together, here’s the bottom bottom bottom bottom line for a similar approach with the S&P:
After four $1,000 investments into an S&P 500 index fund in January 2018, 2019, 2020, and 2021, my portfolio would be worth $6,430 ($1,780 + $1,900 + $1,480 + $1,270)
That is up +61% since January 2018 compared to a +406% gain of the combined Top Ten Crypto Experiment Portfolios.
Here’s a fancy new chart showing the four year ROI comparison between a Top Ten Crypto approach and the S&P as per the rules of the Top Ten Experiments:
Many thanks to the long-time Experiment followers, appreciate you taking the time to follow along over the years. For those just getting into crypto, welcome! I hope these reports can somehow give you a taste of what you may be in for as you begin your crypto adventures. Buckle up, think long term, don’t invest what you can’t afford to lose, and try to enjoy the ride! Feel free to reach out with any questions and stay tuned for monthly progress reports. Keep an eye out for my parallel projects where I repeat the experiment, purchasing another $1000 ($100 each) of new sets of Top Ten cryptos as of January 1st, 2019, January 1st, 2020, January 1st, 2021, and most recently, January 1st, 2022.
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