Is Crypto Attractive To The Average Investor?

The word altcoin is used in English to refer to the remaining coins other than Bitcoin. Considering that the alt phrase is an abbreviation of the word alternative, we understand that other coins initially emerged as an alternative to Bitcoin. Although hundreds of alternatives have emerged over time, Bitcoin maintains its weight in the crypto world. For more than 10 years, it continues to please its investors with its value doubling every year on average.

When it comes to altcoins, the issue gets more complicated. Because there are thousands of them and how they will perform cannot be predicted as easily as Bitcoin. Last night, I sat down and made an analysis on the total values ​​of altcoins.

The chart below shows how the total value of cryptocurrencies other than Bitcoin has evolved from April 2013 to the present. Values ​​are shown on a logarithmic scale in the chart.

I drew the red trend line on the chart. During the drawing, I observed that the areas above and below the trend line were equal. What the chart tells us:

• The total value of alt coins has increased nearly 20,000 times in the last 8.5 years.

• The total value has moved in a predictable direction, although it has moved away from the trend line from time to time.

• In 2021, prices followed a closer course to the trend line.

• Current prices are reasonable according to the model.

The model seen above shows that altcoin prices are increasing an average of 3.26 times each year. This means that those who invest in altcoins and hold them for a long time have achieved an unprecedented return in history in the last 8 years. There is no sign that this trend will change in the coming period. On the contrary, as the years progressed, crypto became a concept that was partially accepted by official authorities and large companies.

So despite all this huge return potential, why don't we see tens of crypto millionaires around us?

Crypto is an area that requires a lot of knowledge compared to other investment alternatives. It contains many pitfalls that can be deducted when invested unconsciously.

The vast majority of small investors enter the market when crypto prices are at their peak. For example, I made my first crypto investment in the first half of 2018, when prices were extremely inflated. Moreover, it didn't occur to me to diversify my crypto portfolio in the beginning.

On the other hand, it is necessary to take security-related issues seriously. Many people lost their savings due to corruption in the central stock exchanges.

Moreover, these thefts can also occur on metamask wallets, which are a safer alternative. Recently, a significant amount of Ethereum was stolen from my metamask wallet. If this is what happens to the former banker who is aware of fraud, what would happen to the average citizen? (It happened because I was a little too confident and connected my wallet to a site I didn't know)

Taking a short-term view, using excessive leverage, chasing tips are other mistakes that individual investors make.

However, individual investors can earn a serious income from this market by making long-term investments in proven crypto currencies such as Bitcoin and Ethereum. Of course, it wouldn't be bad to have some Bitcoincash in the portfolio.

Thank you for reading.