EXPERIMENT - Tracking 2022 Top Ten Cryptocurrencies – Month Six - Down -75%
Find the full blog post with all the tables and graphs here.
Welcome to your monthly no-shill data dump: Here's the sixth monthly report for the 2022 Top Ten Experiment featuring BTC, ETH, BNB, SOL, ADA, USDC, XRP, LUNA, DOT, and AVAX.
tl;dr
What's this all about? I purchased $100 of each of Top 10 Cryptos in Jan. 2018, haven't sold or traded, reporting monthly for over four years. Did the same in 2019, 2020, 2021, and 2022. Learn more about the history and rules of the Experiments (including why in the world I would include stablecoins) here. Learn more about the new features in the 2022 Top Ten Experiment here.
June Highlights: - Portfolio slides, $USTC and $LUNC bounce, combined crypto portfolios ahead of S&P 500
New features: TCAP Total Crypto Market Cap token wins June and maintains overall lead the Top Ten approach in our friendly competition
Month Six – Down -75%
The 2022 Top Ten Crypto Index Fund Portfolio is BTC, ETH, BNB, Solana, ADA, USDC, XRP, LUNA/LUNC, DOT, AVAX.
June highlights for the 2022 Top Ten Portfolio:
Although not as severe as last month’s Lunapocolypse, the 2022 Top Ten Portfolio (and all of crypto) continued to struggle
USTC and LUNC bounce in June, gaining +269% and +31% respectively.
June Ranking and Dropouts
Here’s a look at the movement in the ranks six months into the 2022 Top Ten Index Fund Experiment:
AVAX, LUNC, and DOT have dropped out of the Top Ten, replaced by BUSD, DOGE, and DAI.
LUNC has fallen out of the Top 200, the lowest of any crypto in any of the five Top Ten Portfolios. Second place would be NEM from the 2018 Top Ten, ranked #88 as of the latest update.
June Winners and Losers
June Winners – USTC and LUNC bounce in June, gaining +269% and +31% respectively.
June Losers – ETH, dropping -43% of its value this month. Bitcoin turned in June’s second worst performance, -36%
Overall Update: BNB overtakes BTC for the lead, 100% of cryptos in negative territory, LUNC at bottom.
All cryptos in the 2022 Top Ten are well in the red. BNB (-58%) inches into the lead this month, overtaking Bitcoin (-59%) as the best performing crypto of the 2022 Top Ten Portfolio. XRP (-63%) is in third place.
Although it bounced a bit, LUNC remains at the bottom, worth a fraction of a cent. The initial $100 invested in Luna just six months ago is worth $0 today.
Overall return on $1,000 investment since January 1st, 2022:
After dropping $420 in May, the 2022 Portfolio lost $96 this month. The initial $1000 investment on New Year’s Day 2022 is now worth $246, down three quarters of its value just six months ago.
Here’s a visual summary of the progress so far:
The 2022 Portfolio is still the worst performing of the five Top Ten Crypto Portfolios.
Factoring in USDC Gains
New feature this year – In past Experiment years, I have not included stablecoin gains in the monthly reports, but there are opportunities to earn ROI using stables alone. I figured this would be especially interesting to track this year, depending on how the crypto market performs. My goal of this little side quest was to beat the ROI of as many of the non-stablecoin cryptos in the Experiment as possible.
I started the year using the most straightforward strategies, moving the $100 USDC around to get bonuses from different platforms. With crypto tanking, my ROI on stables was easily outperforming the rest of the portfolio. In May, I decided to do something a bit more interesting. My choice? Convert the USDC to UST, then deposit the UST on Anchor. Seemed like a good idea at the time.
My UST is now worth $5.90.
Here’s a table of the USDC side mission so far this year. I’m up +268% in June, and down -94% overall.
2022 Top Ten Portfolio vs. Total Crypto Market Cap Token (TCAP)
Another new feature this year – The first Top Ten Crypto Experiment was started on 1 January 2018 in an attempt to capture the gains of the entire market. Much has changed in the last 4.5 years, including Decentralized Finance (DeFi) projects that have created index tokens to capture segments of the crypto market (DeFi, the Metaverse, Blue Chips, etc.) instead of manually buying coins and tokens, like I do for my Experiments.
A project of particular interest to the Top Ten Experiments is the Total Crypto Market Cap (TCAP) token, created by Cryptex, which tracks the entire crypto market – exactly what my Top Ten Portfolios have been trying to recreate from the start.
I thought it would be interesting to compare my homemade 2022 Top Ten Crypto Index Fund Experiment to TCAP for a bit of a friendly competition.
Here’s the question I’ll be tracking this year: would I have been better off with $1,000 of TCAP instead of going through the effort of creating a homemade $1,000 Top Ten Index Fund?
TCAP snapshot July 1st:
June: Both the TCAP token and the 2022 Top Ten Portfolio fell again this month, but the damage to the Top Ten portfolio was more severe: the 2022 Top Ten dropped -30% in June compared to TCAP which fell -21%.
The June monthly victory goes to TCAP.
Overall: The 2022 Top Ten Portfolio is currently worth $246 (-75% from January 1st, 2022) which places it below TCAP’s $362 (-64% from January 1st, 2022) value. TCAP takes the overall lead as well. Visual below:
TCAP’s outperformance of an equally weighted Top Ten Portfolio is in line with what the Experiment has observed over the years. Here are the stats (as of 1 July 2022) for the different Top Ten entry points:
Buying the Top Ten at equal weight in Jan 2018: down -55% vs. +51% for the total crypto market cap.
Starting in Jan 2019? +126% for the Top Ten vs. +580% for the Total Market Cap.
Starting in Jan 2020? +227% for the Top Ten vs. +356% for the Total Market Cap.
Starting in Jan 2021? +45% for the Top Ten vs. +12% for the Total Market Cap.
Starting in Jan 2022? -75% for the Top Ten vs. -64% Total Market Cap.
You may notice the 2021 Portfolio is the exception, where the Top Ten is outperforming the TCAP – If history is any indication, I expect the Top 10 to fall behind TCAP eventually.
Bitcoin Dominance:
BitDom dropped this month, ending June at 42.4%. For context, there hasn’t been much movement on this metric so far in 2022. Chart below:
For those just getting into crypto, it’s worth paying attention to the Bitcoin dominance figure, as it signals the appetite for altcoins vs. BTC.
Combining the 2018, 2019, 2020, 2021, and 2022 Top Ten Crypto Portfolios
So, where do we stand if we combine five years of the Top Ten Crypto Index Fund Experiments?
2018 Top Ten Experiment: down -55% (total value $449)
2019 Top Ten Experiment: up +126% (total value $2,256)
2020 Top Ten Experiment: up +227% (total value $3,269) (best performing portfolio)
2021 Top Ten Experiment: up +45% (total value $1,451)
2022 Top Ten Experiment: down -75% (total value $246)
Taking the five portfolios together, here’s the bottom bottom bottom bottom bottom line:
After five annual $1k investments ($5,000 total) in the 2018, 2019, 2020, 2021, and 2022 Top Ten Cryptocurrencies, the combined portfolios are worth $7,671.
That’s up +53% on the combined portfolios. The peak for the combined Top Ten Index Fund Experiment Portfolios was November 2021’s all time high of +533%. Here’s the combined monthly ROI since I started tracking the metric in January 2020 for those who do better with visuals:
In summary: That’s a +53% gain by investing $1k on whichever cryptos happened to be in the Top Ten on January 1st (including stablecoins) for five straight years.
Comparison to S&P 500
I’m also tracking the S&P 500 as part of my Experiment to have a comparison point to traditional markets.
The S&P 500 is down -20% so far in 2022, so the initial $1k investment into crypto on New Year’s Day would be worth $800 had it been redirected to the S&P.
Taking the same invest-$1,000-on-January-1st-of-each-year approach with the S&P 500 that I’ve been documenting through the Top Ten Crypto Experiments, the yields are the following:
$1000 investment in S&P 500 on January 1st, 2018 = $1,430 today
$1000 investment in S&P 500 on January 1st, 2019 = $1,530 today
$1000 investment in S&P 500 on January 1st, 2020 = $1,180 today
$1000 investment in S&P 500 on January 1st, 2021 = $1,020 today
$1000 investment in S&P 500 on January 1st, 2022 = $800 today
Taken together, here’s the bottom bottom bottom bottom bottom line for a similar approach with the S&P:
After five $1,000 investments into an S&P 500 index fund in January 2018, 2019, 2020, 2021, and 2022 my portfolio would be worth $5,960.
That is up +19% since January 2018 compared to a +53% gain of the combined Top Ten Crypto Experiment Portfolios.
The visual below shows a comparison on ROI between a Top Ten Crypto approach and the S&P as per the rules of the Top Ten Experiments:
Conclusion:
To the long time followers of the Top Ten Experiments, thank you so much for sticking around so long. For those just getting into crypto, I hope these reports will help prepare you for the highs and lows that await on your crypto adventures. Buckle up, go with the flow, think long term, and truly don’t invest what you can’t afford to lose, and most importantly, try to enjoy the ride.
A reporting note: I’ll focus on 2022 Top Ten Portfolio reports + one other portfolio on a rotating basis this year, so expect two reports from me per month. June’s extended report is on the 2019 Top Ten Portfolio, which you can access here. You can check out the latest 2018 Top Ten, 2020 Top Ten, and 2021 Top Ten reports as well.
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