You came back! Decided to check back on this thread on a whim--glad I did.

Are you 100% sure it's buying time? Alt prices are reasonably low, I suppose (sort of in that 4x below ATH / 4x above previous high settling area), so it's a good buy relative to the next rise.

I'm still in bear mode and inclined to think we have one last push down. Maybe not as violent as the last drop (6k BTC, etc.), but something near it. I honestly thought we had confirmation that we broke the 2017 log channel once BTC started hitting the 58XXs, and I've held more fiat than I'd like during this recovery because it keeps hinting that there's a better buy coming.

If you have a moment, let's talk Portfolio 2.0. Last year you were leaning 2nd/3rd gen cryptos, this year I've gotten the impression you're...basically all in BTS/STEEM...? Saw you mentioned EOS once on Steemit.

I'm a bit stumped on projects these days. ETH looks crazy expensive. LTC is pricey (gonna be a while for another 10x), but I'm still fond of the project. STEEM honestly just isn't my cup of tea (philosophically not crazy about a social media blockchain). I love BTS, but I don't have a solid vision of its roadmap anymore.

Platform chains like EOS/ZRX/DNT are interesting, though it's hard to form an opinion on a winner between them. Seems like the summer ICO hype is over and now it's getting hard to tell which projects are quietly working hard and which are fading. Thoughts?

Thanks Bittrex.

Thinking long and hard about rebalancing into more BTS out of either LTC or a BTC hedge. LTC is slowly creeping up as a % of my portfolio somehow (down less than BTS, I guess). We all don't invest more than we can afford to lose, right? Really tempted to call this FUD and double-down on the 20% dip (be greedy when others are fearful, etc., etc.). At least catch a rebound pump at some point

Alternatively, this shows how fickle everyone is and how quickly an asset can just tank.

Speculation I'm seeing so far (none of which has been verified or corroborated, in order of how often I'm seeing them):

• Technical issues on Bittrex side (node RAM requirements)
• SEC regulations regarding securities
• Foul-play coinciding w/ ADA launch (former BTS dev(s) on ADA team)
• Consistent decline in value
• Protocol weakness (51% attack risk somehow, possibly because of low price)?

First two seem to be the most reasonable so far. Both of those seem to be the kind of thing you publicly explain, though I get not having a policy of explaining every action (since Twitter will always freak out, valid explanation or not).

How long until the new BTS web exchange, etc. is online?

Whoa, let's talk about this changeup then, particularly for those of us with a higher basis for their LTC where the current profit is less crazy.

Chart looks low (like, 70% retracement low). Volume also near the bottom seen for the past 6 months. RSI in the 30s. This strikes me as a potential risk of selling low? Past-performance caveats aside, doesn't seem like it has a ton further to go down.

Now, I kinda get doubting in the whole 4:1 w/ BTC idea. Less of a TA issue and more of a...idk if public sentiment could ever get it there. But since you did mention fundamentals, what's got you concerned coming from Charlie? Broadly, I've liked that he's been vocal (since it helps the whole public sentiment thing). I also made out very nicely from that atomic-swap test he did between LTC/VTC (thank you for the profit-taking insights!).

This is also the first I've heard of ADA, and I'm leery of buying an ICO the day it comes on the market. What's got you interested?

Let's talk Bitshares for a moment (while they're still charting favorably). I like the project (DEX, etc.) and feel perfectly confident that the price will see better days. Not too worried there.

Here's my question: Does it potentially overexpose a portfolio to China? I was going through a recent State of the Network post, and I noticed that a substantial amount of trading comes from China (BTS/CNY is 51% of transactions, BTC at 48%). BitCNY is also 69% of all the smartcoins held on the exchange (BitUSD is second at 25%).

Presumably this includes external exchanges as well (i.e. the BTC portion), since they'd all need to interface with the BTS network to execute the trade, no?

Now, Bitcoin will be fine without China, ultimately, if it even comes to that (figuring any major stakeholders will find a way around). On the flip side, BTS is (apparently?) much more dependent on them. This makes me a little nervous that some sort of mass-FOMO out would do some serious damage to either the price or the project. I could still see BTS pumping arbitrarily, but in terms of long-term prospects, would love to see more diverse adoption.

Read my way through the Ark whitepaper and working my way through other materials as I find them.

Offhand, the majority of it seems like proposing the same solutions to the same problems that many altcoin-as-a-platform projects are also trying to solve. Falls a lot into the "blockchain solves all the things" area (distributed file storage, blockchain databases, identity management, p2p payments, and so forth). I also see nothing consumer friendly. Obviously this is early stage stuff, but if folks have a hard enough time figuring BTC out...

I do like the SmartBridge/Encoded Listener concept. IFTT between blockchains seems like a useful thing (decentralized exchanges, that sort of thing). That said, I think it's useful because the blockchains themselves that are bridged are useful. I'm less convinced that we need an intermediary blockchain to enable these behaviors.

I see the decentralized/trustless premise of blockchains in general, but in terms of putting money into one, I'm looking for use cases where those attributes bring serious value (i.e. BTC as a self-sustaining store of value). Seems like a lot of Ark's features could be replaced well enough by a local (or server) client that scans existing blockchains today (or listens to a server for triggers, or w/e). Not 100% trustless, but could be open-sourced and trustworthy-enough.

I suspect that any eventual decentralized ecosystem will be a mishmash of competing standards all trying to interconnect rather than any one, beautiful solution.

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Btw, on the Segwit exposure topic, you're watching it carefully more on...principle, yes? In other words, it risks undermining some of the fundamental decentralized model BTC proposed?

Time to rebalance or nah? Got a some ~5% drifts in my portfolio from the typical BTC dip strength (and overweight 2x in BTC). Thought about it yesterday, but the market pretty quickly identified the China stuff as business as usual and didn't really even test $4k.

Plenty of good TA (and my own bad TA) calling for a deeper dip before the end of the year. That said, I'm assuming it'll be awfully quick (and therefore irritating to catch for manual rebalancing). Have limits in fiat in place, so that's something.

BTS just looking tasty right now in both BTC and USD.

Finally started swapping most of my charts to BTC pairings. Totally makes me rethink my future positions.

Feeling way less inclined to take profits off LTC, for instance. Doesn't look like it's flirted with the 0.02 resistance yet (for what that's worth). Riding the upper BBand (1D) but doesn't really freak me out. It's way up in USD, but it's only (only?? the greed) up 80% from its August low in BTC terms. USD tells me sell, BTC says let it ride. Don't screw with a good thing.

I could also rebalance a small amount, but it feels backwards putting higher-grade assets into spec assets at this point (most of my spec-class is meh right now--all the "good" coins in my portfolio are what's running hot). Shouldn't balancing ideally be the other way around? I'd prefer to use new fiat or maybe skim off a small BTC position to feed little 1-2% spec stuff. At the same time, I can't force the markets to match my price opinions.

More importantly though, does all of the above seem like sound reasoning in the general, TA sense (i.e. ignore the hodl/bank LTC angle)?

Also interesting that the latest LTC 0.02 (almost ATH) point was when BTC was tanking in July. Interesting hedge.

As always, tremendously appreciate all of your work keeping up with this thread.

For my edification, 15% => max initial investment (i.e. $1500 for a $10k portfolio), and 30% (i.e. +100% relative) signals enough drift to protect profits? Totally get that there's an art to it. Litecoin presumably being your exception case, as well (I know it wandered into the 50% range).

I think I have a decent grasp for skimming off spec-grade stuff (where I'm entering it intending to skim and don't mind exiting quickly). It's the long-term, undervalued ("investment") assets where I'm like...well, I'd love to take some profit off LTC/XMR/etc. (any reliable, typically high-cap coin), but that seems at-odds with my ultimate assessment that, for instance, LTC is worth more than $70 (or XMR more than $140, etc., etc.).

Every time I've tried profit-taking with BTC/USD I end up with a taxable event and missing the first 10% of the next leg up. Not typically a loss, but not convinced that I'm beating holding because I get too clever. I'd hate to introduce inefficiency across my portfolio just trying to protect recent gains.


Aaaaaaaand now you get to the big question. Are you betting that the IRS will allow like-kind exchanges for these? I've been operating under the notion that any BTC -> ALT trade is taxable at their respective dollar-values. If the whole premise of diversifying between coins is that each has relative strengths, focuses, industries, etc., my gut says that an auditor is going to want to see taxes for every single swap.

Those wash sales are gonna bite too. :/

Just for fun: Is USDT more like a USD or more like BTC? Maybe you can like-kind it with USD but not other cryptos.

And one more (hopefully quick) question.

During the dip last July you shifted a fair amount into USDT. That's a touch high-risk for me given their (and/or bfx) banking troubles. Technically, I'm more worried about an irrational market response to the whole thing.

Any thoughts on an alternative? Could always do Alt -> BTC -> Fiat, but that's messy and I assume slippage becomes a thing. What do you think of bitUSD? Still end up doing Alt -> BTS -> bitUSD, but that seems less risky to me for some reason.

Would've just been happy hoarding LTC but now that's hitting ATH's too. Maybe that's still the answer since it's still way less volatile (retraced like half of what BTC did in July)?

Back from vacation!

Question time: What's your broad strategy for rebalancing? In particular, for mine, I'm thinking through:

• Brackets for taking profit (and how much to take at each)
• Where to hold that profit (...LTC?)
• How often to do it
• Big one: Do you rebalance based on individual performance (i.e. XMR is up 300% -> put 33% someplace else), or based on target portfolio %'s overall (i.e. after 10% drift, move coins with less emphasis on individual fundamentals).
  

For instance, elements of my (and your) portfolio did nicely over the last week. Just can't tell if its worth it to hodl for a year and rebalance with new fiat or keep making these relatively exotic swaps (plus the stress that comes with chasing alts + taxes).

Technically, I'm still underweight on my LTC % even after some profit-taking into it, so that makes me think I should take even more into it. Even so, part of me is like...that's a high % of LTC just sitting there, and I want to reduce that position even further into something looking more primed (i.e. STEEM/BTS/etc.).

Thoughts on a rational framework for this?

Finding my portfolio sitting in a similar position to yours (i.e. nothing too crazy over the last couple of months, ha...). Mine actually did have a reasonable BTC position, but I've burned (profit-taking) a substantial portion of it transferring into both fiat and these favorable BTC/alt ratios.

Still seeing a creeping decline in alts after my rebalancing, so I'm only up like...2% in fiat after all is said and done (more if you include BCH, which I'm hodling until something interesting happens). On the flip side, while my fiat value hasn't moved up, I'm holding a lot more alts than I was, so here's hoping for that next wave.

I'm also finding (rare) little arbitrage opportunities where an Alt/BTC ratio differs from its ETH ratio. Been able to acquire an extra couple % by being choosy and running the more favorable conversion.

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Also not sure if I'm happy or sad that I'm not sitting on alts like NEO/IOTA/etc. I don't really have time swing trade, much less babysit P&Ds. Just jelly that stuff I didn't trust in June/July (ICO hype) is still up like...800%. >.>

You still trusting MCO? Don't own any, but it's retracing down enough that I'm observing it. For some reason I didn't realize it was just an ERC20 token. Was more cautious when I thought it was it's own currency entirely.

What signs would you look for re. entry over the near-term? Assuming I'm okay with using BTC as the reference metric for my portfolio (as opposed to fiat), is it fair to say that if these present BTC/Alt ratios hold post 8/1 (lol) that this is a...reasonable...point for entry?

For instance, BTC/STEEM is hanging around where you started in May, so by that metric, it looks much better now than a month ago. On the flip side, BTC/fiat is awful right now. I get more STEEM for my BTC, but start with less BTC overall soooo... (I guess just do the math?).

Got greedy with the last correction and actually had a bunch of limits whiff just below the bottom. Been playing much more conservatively since then and ultimately been camping out like 80% in fiat for the last month (little dips in/out) because I really didn't trust the upswing. Portfolio is green, but I think I'm missing the forest for the trees. Kept hoping for one more selloff...

Ultimately want to take a position and mostly hold. Clearly a risky time to buy BTC, can't tell what to look for for making the Fiat -> BTC -> Alt jump though. :/

And as always, I appreciate the updates on how your numbers are looking.

Any further thoughts on how you plan to handle the ARDR/NXT/IGNIS transition from a couple of pages back? Makes holding NXT feel "dead" (and perception can matter, I think), but there's that IGNIS airdrop to prop it up. Not entirely sure what sort of useful asset I'd end up with depending on which way I went (i.e. directly into ARDR vs holding NXT+IGNIS). I kind of get the value of holding ARDR on some level (basically like holding NXT/ETH?), not sure what the purpose of IGNIS is yet.

Also, have you explored NIMIQ at all? Just wrapped up an ICO (meh), but they have a working, mining testnet (not just a pretty Wordpress page) and I'm very much a fan of a) a browser/JS based blockchain and b) their very simple UX in an overly technical space.

A trait I keep searching for in crypto is a lack of friction for consumers. Bitcoin has branding, but ultimately there's enough "junk" (single-use addresses, Segwit politics, etc.) that it takes an external, supporting ecosystem (i.e. Coinbase) to make it adoption-friendly. Coins like ETH/XRP/NEM do a little better, but get bogged down again in technical potential ("build on our blockchain!"). I place high (if risky) favor on a later-gen coin that makes the tech invisible instead of its selling point.

Not something to add to the portfolio now, but it's piqued my interest.

Always appreciate the analyses.

I'd already pulled my trading BTC into fiat ahead of most of this to buy the dip. Haven't finalized my alts going forward, so I'm just riding out the small alt positions I had (RIP XRP). Never really trusted ETH, glad for now I was barely exposed.

What I can't figure out is an entry position. We're just still so high up overall. I'm not worried about buying in now and taking another 50% dip for a few months. I'm worried about buying in now and not having fiat handy to buy even more at 50% off. Opportunity cost and all that.

And that's before the complexity of getting a good deal while chaining Fiat -> BTC -> Alt. Any tips on wrapping your head around that one (seems like the charts basically invert step to step)?

Just for my own edification, does "today's sales" refer to your profit-taking from LTC to rebalance?

And presumably your move from GRS was similar? Never looked into that one before, but it seems to be doing well for you at the moment, ha.

And re. SBD, what's got you thinking it's particularly undervalued (i.e. worth including in a portfolio; ignoring present conditions)? I get that it's got plenty of room to grow, but idk that I have much confidence with the underlying business model (blockchain social network). Seems like a solution looking for a problem? Doesn't mean it won't have a decent ROI, just something I don't understand much yet.

-long reply inc-

That makes sense. I'm assuming IBM is looked at as a stable, slow stock. I've generally stuck with ETFs--don't have a lot of experience picking individuals. Speaking of which, I've seen some of your posts re. how you choose to evaluate coins (dev teams, etc.), but how do you translate [base ratio (i.e. 4:1)] + [dev/value potential] into [250x growth]? I understand filtering out trash coins, but I have no idea where to even start to weigh, say, NEM vs Monero vs Ether rationally (much less a top-25 or 50 coin).

I tend to agree re. LTC. It feels like an asset that serves the same purpose as BTC but is less constrained by BTC's baggage. I actually have more faith in it as a project (though the market doesn't always value what's "right"...).

My main fear with with dropping entirely out of BTC (as opposed to a 10-30% allocation) is simply FOMO as it gains more consumer recognition (and, I expect, institutional $). In other words, I don't know if LTC can ever hit BTC's popularity. Maybe that's the wrong way to look at it though. It has more relative room to climb and if BTC ever goes moon to 50k, it's not like other major coins won't jump mostly in tandem. 20x is 20x.

And yeah, Ripple is very different and kind of antithetical to the original crypto movement. I like it because (I think) it plays by different fundamentals. I suspect it panders a bit to the global financial system rather than giving it the finger, which is simply an intriguing approach.

Entirely anecdotal, but today when BTC dropped 2.6% (at time of writing), Ripple lost 3.7% and most alts ate 6-15%. Technically, this would indicate that BTC was still a better reserve, but it makes me think most folks in Ripple are holders instead of traders, so it reads as low-risk (as far as that goes). Now, I have no idea what to do with that information. I'm not super risk-averse (I mean, this is crypto, ha)--should I be looking to allocate any of my portfolio to boring hedge-coins (BTC/XRP/$)? Now it's -3 for BTC and -8 for Ripple/Lite/Eth, so the theory now has as much evidence against as for.

I also totally agree with the point re. the long-term (woo cold storage). Ultimately, holding any reasonable coin will probably turn out favorably. Buuuuuuuuuut, let's just say I like your idea of a portfolio that navigates a 1y timeframe (because that's an eternity here). Do you just roll medium + high risk and dump the boring, 2x potential BTC?

Love this thread. Way more thought here than most.

Within the context of a pure-crypto portfolio (safer assets being outside this scope), how do you feel about utilizing a small allocation (10% or less) of BTC similar to bonds in an aggressive stock portfolio?

Bitcoin doesn't have the same inverse relationship with alts that bonds have with stocks (i.e. if BTC drops, alts tend to tank too), but when alts drop on their own, one might reasonably expect BTC to perform better as a safer haven.

Perform the usual rebalancing during ups/downs, etc.

In your portfolio, LTC seems to be playing a middle ground (I like your heavy allocation). Likely to be the most stable coin, but also with adequate growth potential (the irony of all this being that 2-25x is considered "adequate"). Is it fair to say this is your "bond" allocation? Is that even a valid concept worth pursuing within this space?

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Additionally, what are your thoughts on Ripple (XRP) as both a potential blue chip and as serving in a bond-like, stabilizer role?

I don't know that it hits your growth targets. 250x growth would give it a long-term market cap of 6.25T (there's like a 2000:1 ratio of XRP:LTC supply right now). Now, an apologist would point out that it's got serious devs and is aimed at the ~37T inter-banking market. Fair, but that relies on enterprise adoption vs consumer fomo. Serious influx of capital if it happens, but you have to convince BofA vs Joe Investor. May be a long-term play, but probably not for your 1-year term?

On the flip side, it's largely ignored the recent alt decline and more-or-less tracks BTC (or just moves sideways). Devs hold like 60% of the supply, which sounds like it's meant to hedge against the volatility that would scare corporate customers away from normal crypto (but again, potentially fails your requirements).

Is it weird (stupid?) to consider an alt (or BTC) as a base for storing/hedging value (possibly over growth)? Is the marginal chance of return worth leveraging over fiat?