“Although I am optimistic about blockchain technology and I think it is the future, it is early to risk too much when investing in cryptocurrencies. I see too many investors who allocate all, or most, of their assets,” explained the entrepreneur.
“I receive emails every week from people who have taken out loans, second mortgages or taken advantage of their cryptocurrency holdings to buy more cryptocurrencies. This is dangerous and silly,” he added and continued: “Why risk so much of the security and the freedom of your life in a single investment? “.
To his knowledge, the American businessman claimed that it makes no sense to invest more than 5% of net worth in cryptocurrencies. Most of the investment portfolio should be concentrated in “historically more predictable assets, such as stocks, bonds and real estate.”
On diversifications, the specialist maintained the importance of having conventional cryptocurrencies and alternative cryptocurrencies. In this way, the balance would provide a great risk-return equation.
“Humans are terrible at predicting the future. Most of the cryptocurrencies now on the market will be worth nothing in the next few years,” he said. He further exemplified by saying that “just as more than 90% of individual investors are not capable of beating the stock market, it is extremely difficult to predict which will be the winning cryptocurrencies in the long term. That is why it is important to diversify between traditional and novel cryptocurrencies. “.
At the same time, he looks at the dangers of following trends with a lack of sense such as the purchase of cryptocurrencies that are reflected in memes or better known as “memecoins”.
“Investing is not gambling. Therefore, I am not a fan, nor do I recommend, investing in meme-based cryptocurrencies.”, added.
And he concludes: “Shiba inu (SHIB) has had a dizzying uptrend for the last month, but I would not put my money there, because there is nothing but advertising behind it. There is no reason to add so much risk to my portfolio.”
Source From: Ambito
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