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DCAing BTC vs Top Alts

All Cryptocurrencies

by COINS NEWS 96 Views

Picture this: it's November 11, 2021, the pinnacle of the previous market cycle, and you decide to take the plunge into investing, right at the market's all-time high. Yet, you're not deterred, you've got a strategy: investing $100 every week for the next two years, come rain or shine. It might not seem like the ideal timing to dive in, but you keep hearing "time in the market beats timing the market". So, you navigate to Kraken, close the blinders, light up a cigarette, complete your KYC process, set up a recurring order, and then you let it slip from your mind. Until now.

That's the premise. Perhaps you're wondering, what if instead of allocating those funds to Bitcoin, you had opted for Ethereum, Cardano, Solana, or Algorand? Let's explore this, we're looking into the top 10 most popular coins, distributing $100 per week since the ominous date of November 11, 2021, all the way to today, August 31, 2023. Why November 11, 2021? It marked the zenith of the market, arguably the worst time to jump into the crypto waters. But why deliberately select the worst day? Because that's the mindset of a prudent investor seeking resilience and low-risk assets to safeguard their hard-earned capital: "Expect the worst, hope for the best."

The alt-coins:

  1. Bitcoin.
  2. Ethereum.
  3. BNB.
  4. XRP.
  5. ADA.
  6. SOL.
  7. DOT.
  8. MATIC.
  9. LTC.
  10. LINK.
  11. BONUS: Algorand.

Asset Invested from 11/11/2021 until 08/31/2023 Current Value as 08/31/2023 Difference as 08/31/2023
Bitcoin $9,500 $9,777 +2.92%
Ethereum $9,500 $8,885 -6.47%
BNB $9,500 $6,891 -27.46 %
XRP $9,500 $10,361.10 +9.06%
ADA $9,500 $5,604.78 -41.00%
SOL $9,500 $6,719.56 -29.27%
DOT $9,500 $5,691.55 -40.09%
MATIC $9,500 $5,913.69 -37.75%
LTC $9,500 $7,976.42 -16.04%
LINK $9,500 $6,916.89 -27.19%
ALGO $9,500 $3,512.72 -63.02%

Now for the fun part, let's talk about these numbers:

  • If you DCAed into Bitcoin, you outperformed 82% of people DCAing into other coins.
  • If you DCAed into XRP, you outperformed 90% of people DCAing into other coins, including Bitcoin.
  • On average, holding anything else other than BTC would yield an average return of -28%, or -$2,660.
  • Holding this sub's golden boys: ADA, ALGO, MATIC, LINK would yield an average return of -42%, or -$3,990.
  • Holding this sub's most hated coins: SOL, XRP, BNB would yield an average return of -16%, or -$1,520. That a 26% difference, or -$2,470, from the golden boys, and proof of the "Inverse r/cc Law".

Those are some interesting facts, but what if instead of DCAing every week you did it every month, does it makes a difference? let's see:

Asset Weekly Monthly Difference
Bitcoin +2.92% 2.43% -0.49%
Ethereum -6.47% -6.69% -0.22%
BNB -27.46 % -28.15% -0.69%
XRP +9.06% +8.63% -0.43%
ADA -41.00% -40.80% +0.2%
SOL -29.27% -28.37% +0.9%
DOT -40.09% -39.77% +0.32
MATIC -37.75% -37.25% +0.5%
LTC -16.04% -17.25% -1.21%
LINK -27.19% -27.72% -0.53%
ALGO -63.02% -62.35% -0.67%

Not really, an average of -1/+1 % is not really that impactful, unless you're investing millions of dollars.

So, there you go, in case you were wondering "What if?" or "does it really makes a difference to DCA weekly or monthly?". Some people ask why most veterans end up becoming Bitcoin maxis, and this is why, cycle after cycle the same story repeats. If you're investing, you want a "low risk" resilient asset to put your money in, instead of a high-risk volatile asset that can dilute your paycheck by 60%.

But I like to degen! I want huge profits! remember that you'll always have your ALT/BTC pair, and in bear markets, BTC is your friend, always.

submitted by /u/OMFGROFLMAO2
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