At the end of February 2023, marking Two Years On, the bank stands at $551.56: a loss of $608.68 since the review started. Clearly, a very disappointing performance after a considerable time. Covid-19 and the war in Ukraine caused a bear run on markets in general and our crypto portfolio in particular. The collapse of one of the major crypto exchanges, FTX, and continuing economic recessionary tendencies led to a further bearish trend in the crypto market.
Crypto has undergone some recovery since my last update five months ago; and macroeconomic indicators (which crypto now tends to follow) are more positive. Michael Mac (Director, CTA) maintains we are currently in a crypto accumulation phase with a bull run expected later this year. The fundamental big picture (ever-improving technology and widening of crypto applications) looks excellent.
On the advice of The CTA, some of the cash (stablecoin) part of the main portfolio was used to purchase more of two main crypto coins in mid-January, 2023. Because these coins are considered to be in value territory for long-term gain. Furthermore, in early February some of the portfolio Bitcoin was sold for more Ethereum.
Three coins have been cashed in and removed from The Official (Main) Portfolio. Two of these coins I had at FTX and their loss (relatively very small) has been factored into the results.
Here are the latest stats and developments:
The Main Portfolio
A gain of $29.36 over the last five-month period.
Here are the essential stats for 24 months:
Acquisition Cost: $1160.14 (Completed on February 11th, 2021)
Minimum Bank: $410.67 (Jan 1st, 2023)
Maximum Bank: $2197.55 (May 10th, 2021)
Number of Profitable Months: 11/24
Number of Crypto coins in the main portfolio: 14 (includes one stablecoin)
Current Bank: $551.56 (February 28th, 2023)
Profit/Loss Since Acquisition: -$608.68
Return on Bank since Acquisition: -52.47%
The graph below shows the daily value of the portfolio from March 1st, 2021 through February 28th, 2023:
The last 240 days indicate an Accumulation Phase.
Five new airdrop-free tokens were reported. Unfortunately, I did not qualify; members of management qualified for all five as they have much bigger crypto investments.
There are also a total of 5 coins being staked that are associated with potential/acquired airdrops. Yearly rates for these coins are 4.7% to 66.3%. One coin, CRBRUS, was being staked but is now defunct. Total gains from this staking are $6!
A total of six portfolio coins are currently being staked. The total profit to date from portfolio-staked coins is $21, equal to 3.8% of the overall portfolio value, $551.56. The annual interest rate on portfolio-staked coins varies from 3.4% to 13.6%.
Short Term Trades (Buying and Selling the same crypto coin)
The next update will be in three to four months.
In general, the best time to sign up for a crypto service is at or near the bottom of a bear market as this is the time when the coins are at their greatest value for long-term growth. So now is a good time. Here are the results of two additional portfolios that I have set up recently. The first portfolio utilizes the three main CTA crypto coin holdings (Bitcoin, Ethereum and one other) and the second portfolio is the first plus two other CTA recommended coins. They were set up using Dollar Cost Averaging (see The Mini Glossary) over a period of about 10 weeks. The graphs start at the date when the 10-week set-up periods were completed. The green lines are the highest reached values and the red lines are the lowest reached values.
As is evident in the above two graphs, there have been recent big gains in the last several weeks, but Michael Mac indicates that we are not out of the woods yet and markets obviously are not going to be climbing in a straight line up from here. Price action often corrects/pauses after big gains. Patience & discipline pays. But he thinks that the most likely scenario is we’ve seen the bottom of the crypto markets and he expects 2023 to see sideways accumulation for a while then at some stage later in the new year, a new bull market will start. Life-changing gains in crypto are made by investing low and riding the next big wave up.
Note membership in CTA includes many introductory how-to guides. As well as primers on Crypto and Tax; Crypto Security; and Dollar Cost Averaging. In addition, there are spreadsheets to monitor portfolio performance, airdrops, and compounding.
Important Addition: CTA has recently been offering a 5-Day Challenge for just seven quid (as Graham posted), where one can learn the basics of crypto trading in easily digestible chunks one day at a time. This includes setting up an account at an exchange, purchasing the core cryptos, understanding the crypto mindset, purchasing an altcoin, and how to stake coins. Currently, there is a waiting list for the next course. To join this waiting list, click here.
The Accumulation Phase typically happens before an uptrend. The Accumulation Phase is over when the market sentiment moves from a negative stance to a neutral one. During this phase, a lot of money is both entering and leaving the market at the same time.
Airdrops involve crypto projects sending free tokens en masse to their communities in a bid to encourage adoption.
Altcoin. If the entire cryptocurrency universe expanded from a single point, sort of like a big bang, that point of singularity would be Bitcoin, the first cryptocurrency. Ethereum introduced another region to the blockchain universe: one that allowed for innovations such as smart contracts and decentralized applications (dapps) to flourish. An altcoin is every cryptocurrency that’s not either Bitcoin or Ethereum.
Dollar-cost averaging is the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of a security. Dollar-cost averaging can reduce the overall impact of price volatility and lower the average cost per share.
NFT stands for “non-fungible token.” At a basic level, an NFT is a digital asset that links ownership to unique physical or digital items, such as works of art, real estate, music, or videos. Non-fungible more or less means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you’d have something completely different.
Stablecoins are cryptocurrencies that attempt to peg their market value to some external reference like the U.S. dollar.
Staking cryptocurrencies is a process that involves committing your crypto assets to support a blockchain network and confirm transactions. Staking can be a great way to use your crypto to generate passive income especially because some cryptocurrencies offer high-interest rates for staking.