Way back on November 14th of 2023, I wrote
this post about "The great Bitcoin Play" of 2023-2025." The idea was that the coming Bitcoin ETF(s) and the Bitcoin halving in the spring of 2024 were solid, fundamental reasons why Bitcoin was in the early stages of another big bull cycle.
The rise in Bitcoin, and then Ethereum (there's one or more Eth ETFs coming as well), should drive many other cryptos higher as well, over the next 12 to 24 months. When I wrote that post, Bitcoin was at $35,554 per BTC, and Ethereum was at $1,979 per Eth. As I write this post today (on February 21, 2024), Bitcoin is at $51,019, up $15,465 per Bitcoin, or 43% from November 11th, 2023. Ethereum is at $2,910, up $931 per Eth, or 47% since then. I told you guys something was happening here. If I had any actual money, I would have invested some at that point. But I'm a broke homeless guy, and I didn't. My loss.
On December 21st, 2023, I opened a Coinbase account, hoping to be able to scrape up $50 or $100, to get at least a little bit of money into crypto to ride this big wave. As most of you know, I've been homeless a long time, and am continually struggling with day to day life, and to eventually make enough money to get back on my feet, rent an apartment again, and all that stuff. I see this crypto bull market, for Bitcoin and Eth, at least, as one of the most solid investment opportunities of the next couple of years. Personally, I think we're already in a recession, one that will become visible to everyone in the next 2 to 4 months. I may be wrong with that assessment, but if so, it appears the U.S. will head into recession soon. Germany, and now Japan and the U.K. ,are all in recession now, and China's residential real estate market (which is a HUGE Ponzi scheme, basically), is beginning to implode. Chinese developer Evergrande isn't so grand anymore, and is being liquidated, and that's a huge company. China's real estate market was worth something like $62 trillion, possibly the biggest investment market in the world (the total bond market may be bigger). That will lead to more chaos and economic woes for China, for quite a while. YouTube economic brains, Steven Van Metre and Jeff Snider, have been talking about a "globally synchronized recession" for months. We seem to be heading into it now, with the U.S. economy better than others, but still probably heading into recession, if we're not already in one.
It looks to me like most traditional investments (stocks, residential real estate, gold), will drop, or at best be pretty chaotic, possibly stagnant, for the next 2 to 3 years.
Unfortunately, I wasn't able to put any money into my crypto account, since I have a cheap Obama phone, the system wouldn't accept it. I think that's the government saying, "We won't let you speculate on crypto, you broke-ass motherfucker." Or something like that. That really pissed me off. I've been watching crypto for a couple of years now, learning, and trying to understand the Big Picture of it. The growing bull market cycle is about as obvious as it comes, if you pay attention to crypto. Bitcoin hit bottom about $15,500 per BTC, in November 2022, when the FTX collapse/scandal happened. Then U.S. regulators tried their best to kill it off, but couldn't. Bitcoin has inched back up to over $50,000 now, with other top cryptos climbing behind it. There's more to come, thanks largely to the halving, which is encoded into the blockchain. That should happen in April.
Not being able to put at least a little bit of money into crypto in December really pissed me off. I'm sick of seeing investment opportunities drift by, and not being able to take advantage of them, since I'm just scraping by. So I decided to "paper trade" this crypto market instead. Paper trading is an old term, where people would pretend to buy and sell stocks or other investments, and write the in and out points on paper. In the pre-internet days, that's how investors would test ideas, or try to learn about markets, without putting an real money up that could be lost with a bad decision.
So that's what I did. I pretended to invest $10,000 in several cryptos on December 21, 2023. I decided to check in every once in a while, and see how they're doing, and "sell" or "buy" other cryptos (or other investments, if any look better than crypto), and see how it all plays out. This is a big experiment. Am I right about a 12-24 month bull market in crypto? We will all find out as the months play out. This post is my two months in look at how my crypto picks are doing.
I was thinking that I did the original post on December 11, 2023, not on the 21st. So on the evening of February 10, 2024, I figured out where each pick was, up or down, and made one change. So here's how things are going. I made one change on December 10th, I sold all my THORChain, at a loss, and bought more Solana with the remaining money, figuring a 5%, gas fee for each trade.
On December 21st, I took my imaginary $10,000, and "invested" $9,500 in several cryptos, with $500 (5%) in total fees. That's the high end of potential gas fees, just to figure them in and make it legit. Here's what that bought me then. Here's the December 21, 2023 post, to see the details, and initial prices paid for each.
On December 21st, 2023, I "bought" .02399 Bitcoin for $1,000, .4518 Eth for $1,000, 1234.56 Apecoin for $2,000, 56.931 Avalanche for $2,000, 14.357 Solana, 172.413 Thorchain for $1,000, 74.962 Polkadot for $500, 535.298 Polygon for $500, 490.196 Sandbox for $250, and 510.204 Decentraland for $250.
Again, this is a paper trade, an experiment, NOT an actual investment of money. So that was $9,500 into crypto with $500 in fees. Then, since I was thinking I did this on December 11, I looked at it on February 10, to figure it all out and write this 2 month blog post. Then I double checked, and realized I was ten days early. But I decided to dump the Thorchain then, and but more Solana with the proceeds. I sold the Thorchain at a loss for $881.03, with a $44 fee. I picked up Solana at $109.02, with the remaining $837.03. That gave me 7.29 more Solana after the 5% fee.
So here's where my $10,000 investment challenge stands right now on February 21, 2024, at today's prices:
.02399 Bitcoin at $51,109.76 = $1,223.96
.4518 Ethereum at $2,910.98 = $1,315.18
21.647 Solana at $101.83 = $2,204.31
56.931 Avalanche at $36.74 = $2,091.64
74.962 Polkadot at $7.35 = $550.97
595.298 Polygon at $.92 = $547.67
1234.56 Apecoin at $1.68 = $2,074.06
490.196 Sandbox at $.48 = $235.29
510.204 Decentraland at $.47 = $239.80
Total value: $10,482.88 (Feb.21, 2024)
So, from the $10,000 "invested" in crypto on December 21, 2023, with $500 paid in fees initially, I'm up 4.8% from initial $10K, (with the fees included), in two months. Or I'm up 5.08% from the $9,500 invested in crypto, not including fees, in two months. That would be a 57% return on an annual basis, if it stays at that level. So my $10,000 investment, my paper trade experiment in crypto is off to a good start.
OK, that's cool and all. But you may be wondering, why did I pick these cryptos out of the thousands that exist? Here's my thinking. Bitcoin is the original blockchain crypto, and while it's useful mainly as a store of value these days, It is the most decentralized crypto, and the biggest, and most widely held. The case for the ETF's and then the halving (in April?) made sense to me. Those are solid reasons that Bitcoin is in another long bull cycle, which usually lasts 12-24 months. So far, each bull cycle has been much bigger than the previous one. So that's a good reason to put some money in BTC. But Bitcoin may go 4X from the $35k it was at (at my November 14th 2023 blog post), that's $140,000 per coin. Maybe. 3X or 4X TOPS from $35K. But not much more. So I thought Eth, my personal favorite crypto, will ride the wave, probably hitting another higher high, like Bitcoin. So those first two are the solid bets, if we're in the early part of another long, crypto bull market. So far, it appears that we are in that next bull cycle.
Solana is huge in the NFT space now, because people can mint NFT's on the Solana chain, with much, much lower gas fees than on Ethereum. That's why I picked Solana, and why I dumped THORChain to to buy more Solana. Avalanche is tied to blockhain gaming, and I think NFT's, and especially Web 3/blockchain gaming, will be huge this crypto wave.
Apecoin is the token of Yuga Labs, who put out the Bored Ape Yacht Club NFT's, and much more since. I think they're a great team, and doing really cool shit in Web 3/crypto world, so that's why the big bet on Apecoin. I think they will pop late, quite a while after BTC, Eth, and the level 1 & 2 cryptos. Apecoin hit about $27 per unit at its peak, and hovered around $6 to $7 each for a long while, before crypto winter set it.
Polkadot and Polygon are both Level 2 cryptos from the last wave, and my guess is that they'll ride the big wave to some degree, with solid returns. Sandbox and Decentraland are two of the main metaverses, which are still being used, but have completely fallen out of favor with most crypto investors. But they are still places where NFT's can be shared, where people can buy "land" in their metaverses, and build virtual locations. And they're cheap. So they are a long shot that. Once we hit the FOMO stage of crypto buying, several months from now, they may pop big and come back in vogue. Maybe. Or they may not. Like I said, they are a long shot.
So that's my thinking on why I picked these particular cryptos for my $10,000 crypto paper trading experiment. This is not a "shoot for the moon, I want 100X return!" basket of cryptos. I picked cryptos that I think can be sold near their new peaks, and turn the original $10,000 investment into $20,000 to maybe $40,000 in 12 to 18 months. That's the idea. Again, it's an experiment, a paper trade, since I couldn't get money into crypto when I wanted to, as things were rising.
