Every cryptocurrency falls into one of the following three (3) categories:
- Shitcoin
- Low cap gem
- Blue-chip
In this post, I will be sharing with you how to identify each of these types of coins and the best way to invest them respectively.
1. Shitcoins
Shitcoins are cryptocurrencies that do not have tangible real-life use case(s). They’re either created for fun (meme coins), pure speculation, to facilitate some Ponzi schemes or outright scams.
Popular examples of shitcoins include Doge, Shiba Inu, Safemoon, Safemars, Doge0, Rich Quack, and thousands of others you will easily find on CoinGecko and CoinMarketCap.
By all means, I suggest you avoid “gambling” your money on shitcoins.
However, if you want to make gambling on shitcoins part of your overall crypto investment strategy, I got you covered too.
1.1 How to invest profitably in shitcoins
Before we continue, please know that shitcoins are mostly SCAMS and “investing” in them is generally considered to be gambling.
There’s a more than 51% chance that you will lose all or a significant portion of your money.
Now with that out of the way, if I still can’t stop you from playing the shitcoins game, maybe I can teach you how to win.
Here is a simple shitcoin investing strategy that you can adopt and hopefully perfect to work for you.
1.1.1 Step by step guide to investing in shitcoins
- Allocate a fixed amount or percentage of your portfolio to shitcoins. For example, you can allocate $1,000 or 1% to 10% of your portfolio for investing in shitcoins.
- Divide the amount into 10 equal parts (e.g. $100 each), and invest in them 10 different, carefully selected shitcoins.
- Try to invest in the shitcoins as early as possible. If you strongly feel you’re too late to the party I suggest you pass and move on to the next new shitcoin.
- Target especially those shitcoins that quickly get listed on a major or fairly popular centralized exchange. They got a lot of influence and hype or marketing power. You will want to ride the wave with them. The stronger you can feel the hype, the greater their pump (and ) and dump will be.
- Once you buy your shitcoin, you will only sell after it does a 10x (1000%) or more. Yes, you are selling everything and moving on to the next shining shitcoin. They got no future, so there’s no reason to HODL them indefinitely. Plus you can’t know when the show will be over, so it’s best you leave the stage while the hype is loudest.
- Then invest the shitcoin profit into more solid projects that you believe in like: ETH, BTC, BCH, BNB, SOL, LINK, PRE, BAT, etc
- Finally, never invest in the same shitcoin twice. Once you exit with your 10x profit, do not go back and do not feel any regret (GREED) even if it keeps rising after you have sold. Just move on to the next shining shitcoin and invest the same amount as in the beginning. Do not increase your stake because you made a profit.
Continue this way until you’re too rich to bother about shitcoins or you lose your shitcoin investing capital and gain some extra sense.
PS: The 10x (1000%) profit target is my own idea. You can set your own exit target to be 2x, 5x, 10x, or whatever. But the most important something is, make sure you stick to it, no matter what.
In addition, you can find new shitcoins in the recently added section of CoinMarketCap and CoinGecko every day.
Another place to look for the latest shitcoins is the r/CryptoMoonShots subreddit on Reddit.
2. Low cap gems
Low cap coins are usually new, up and coming, promising cryptocurrencies with solid fundamentals but have a relatively small market cap.
These projects have very good technology, a working product, a competent and committed team, an active and growing community, real-life use cases, great tokenomics, etc.
However, their market cap is usually low, within the range of $1 million to $10 billion (depending on their market size) with lots of room to grow.
Barring any unforeseen setback, most low cap gems will easily do a 10x within a year or two at most.
Some good examples of popular low cap coins include ONE, MDX, HNT, ALGO, VET, CHZ, KCS, BAT, PRE, BCH, etc.
Note that there are low cap coins that are not as popular as the above-mentioned ones. That’s why we call them “gems”. You will have to go do your own research (DYOR) and discover them as early as you can.
2.1 How to invest profitably in low cap gems
Low cap gems should be a significant part of your long term investment, and you need to HODL them until you reach your take-profit target.
Because, at some point, you will begin to sell them gradually, until you have totally exited your position.
First, you need to allocate a portion of your portfolio to low cap gems. For me, low cap coins constitute 70% to 80% of my entire crypto portfolio.
This is because I’m still at the wealth-building stage of my crypto investment, so I like to invest in coins with bigger upside potentials.
If you catch it early, especially during presales or a major dip, you can buy all that you can afford at once or DCA (dollar-cost-average) gradually then HODL until you reach your profit-taking target.
Personally, I will only start taking profit after the first 10x (1000%), at which point, I will sell 25% (1/4) of the coin.
Subsequently, I will sell another 25% after every 2x (100%) from my last selling price. until I’m all out.
If the coin or token falls significantly (-30% to -50%+) during or after I have taken all profits, I might consider buying back at the cheaper price, depending on how much faith I still have in the project to produce further gains.
The realized profits from my low cap gems will be invested in a stablecoin or more established and less risky coins such as BTC and ETH. I will then lend or stake these coins for passive, residual income.
PS: Because I seriously believe in the long term success of my low cap gems, I’m willing to HODL and keep farming or staking them for as long as it takes to reach my profit target. I can also be flexible and can adapt my plans and strategy to changing realities. And I suggest you should also learn to adapt to the market.
3. Blue chips
Blue-chip coins are cryptocurrencies with an established market presence and significantly large marketcap.
They’re market leaders in either or both the entire industry and their respective niches.
These are the cryptocurrency version of the famous “too big to fail” companies (if there’s such a thing).
The two major blue-chip coins are BTC and ETH. Other projects that are getting close to this status include LINK, BNB, UNI, SOL, etc.
Like low cap coins, blue chips have good technology, a working product, a competent and committed team, an active and growing community, real-life use cases, great tokenomics, etc.
They’re less-risky and more stable than low-cap coins but usually offer lower potential lending or staking returns.
3.1 How to invest profitably in blue-chip coins
The ultimate investment strategy for blue-chips is to HODL and stake or lend them “forever” and live on the returns they generate. You will only be spending or selling them when absolutely necessary.
Conclusion
Every cryptocurrency in the market is either a blue-chip, low cap gem or total shitcoin.
Regardless of which type you choose to invest in, you will still make money if your strategy is good and you keep your emotions (greed and fear) in check.
For some of us, our portfolio constitutes all three categories of cryptocurrencies in various proportions.
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