How to invest in cryptocurrency if you have $10K, $100K, and $1M USD

If you have $10K USD…

Use Coinbase to buy $8K of Bitcoin and $2K of Ethereum. Use the Coinbase Vault service to store your coins and turn on 2FA.

Resist the temptation to day trade. For simplicity sake, buy all at once, or you can setup a recurring weekly or monthly buy to dollar cost average.

If you have $100K USD…

Buy Bitcoin and Ethereum and one or two altcoins depending on how well you understand them. I’ve invested in the space since 2013 and right now I own 5: Bitcoin, Ether (and a negligible amount of ETC), Dash, Monero, and Decred.

If you go beyond BTC and ETH, I can only confidently recommend Monero at this moment. Crypto changes fast so that recommendation could change in a week. But since I first bought Dash around $17, the price has gone crazy and I don’t feel confident in it anymore. Decred is a flier for me.

Use a large trusted exchange like Poloniex and GDAX and Kraken to purchase your coins – ideally in a recurring buy over a number of weeks. If you want to buy all at once, consider an OTC service like itBit. I can introduce you to some OTC brokers as well, but I’d only recommend OTC if you’re an experienced financial investor.

You can invest in exchange listed products as well, like GBTC and COINXBT. The pros include convenience, tax benefits, and some additional regulatory oversight. Cons include extra fees and counterparty risk. For more, here’s my write-up on the crypto fund investing landscape.

Keep the majority of your coins in cold storage using a service like Coinbase Vault or Xapo, or a hardware wallet like Trezor and Ledger. Electrum is also a good local wallet.

If you have $1M USD…

Continue with the above, and diversify your portfolio into a few other altcoins. Perhaps Decred or Dash or Zcash. I’d stay away from ICOs and token sales unless you really know what you’re doing.

Crypto funds become an even more attractive option, especially private funds which have investor minimums. Examples include Pantera and Logos Fund.

Dollar cost average over a number of months, or find an OTC broker.

Diversify your cold storage solutions. Don’t put all your coins in one place. Check those places routinely. Always turn on 2FA and have unique site-specific passwords and if a seed is required, save it somewhere secure.

Tracking becomes important. CoinTracking is a good tool for portfolio monitoring and reporting and taxation. I’ve tried it, but am still wedded to my hacked together Google spreadsheet.

There’s a lot more you can do to optimize your crypto portfolio as you increase your time spent and financial investment. Some of the coins offer staking services to earn a return on your holdings, eg, Dash and Decred. Follow community happenings on reddit and Slack and read read read.

But don’t day trade and don’t short, unless you want to lose money. My view is that crypto will go from a $25B market cap today to $100B by 2020. Diversify your investments, watch them closely, adjust portfolio allocations to roughly match each coin’s respective market cap, and profit.

To champagne wishes and crypto dreams! 🙂

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