First, disclaimers: I obviously am not a pro, so this is just my opinion and what I would do if I had an extra $500 to invest. Also, something I always tell myself and anyone else who wants to get in to crypto, don't put up any money that you aren't ok with losing.
Crypto currencies can be super volatile. You can make money really fast, but you potentially can lose money really fast. If you look at it as more of a long term investment, I believe that cryptocurrencies will continue to go up, despite huge down days like yesterday. Basically the top 100 crypto currencies were down 20-30% yesterday, except for maybe 2. YIKES!
That being said, with the market being down, it is a good time to buy and hold.
The top 3
Bitcoin, obviously. I don't actually own much of this, I only use it for trading purposes since it is the most widely recognized and accepted cryptocurrency.
Ether, also recognized as ethereum. (Ethereum is a platform, Ether is the currency)
Litecoin, Had huge gains last month. I put more than a hundred dollars in back around August and it is up 6x from then.
I say that those are the top 3 because they are the only ones traded on Coinbase.com, which is a trading platform. This is the easiest way to start getting into crypto for people in the US. They also have Bitcoin Cash (another currency), but I'm not really a huge fan.
After buying bitcoin, ethereum, or litecoin on Coinbase, you can then send your currency to another platform and trade for other smaller currencies. Some of these smaller currencies, called alt coins, have really great potential. Coinbase plans to add some of them to their platform, but haven't and most likely won't say anything until they are already up on the platform. But, you better believe that as soon as Coinbase adds these currencies, they are going to go way up in value. At least that is the hope!
My favorite Alt-Coins. I own anywhere from $25-400 in each of these:
Ripple, XRP - This coin was built for financial institutions which gives it its biggest appeal. Asia is going crazy over it right now. But it also doesn't currently fit the guidelines to be traded on coinbase. But they have plans to change and meet those guidelines. It has gone up more than 400% in the last month and I think it is going to keep going up. It currently sells at $1.15, so you could easily get a lot of this!
Augur, REP
Golem, GNT
Stellar Lumens, XLM
Iota, MIOTA
Bitcoin Cash, BCH (yes I own a little bit, not because I purchased it though. Bitcoin Cash came after a fork in the Bitcoin blockchain. People who owned Bitcoin were basically just given Bitcoin Cash. I don't really own Bitcoin anymore, but I did at the time of the fork.
Cardano, ADA
Tron, TRX
I suggest using Coinmarketcap.com to look at the history of each coin you purchase. Google each and look at what the coin is for and make your decision based on that.
So I would suggest taking one of two routes:
- You put it all in 1-3 of the bigger coins and hope that they continue to go up. (Ronnie's suggestion: Ether, Litecoin, Ripple)
- Diversify. Find 5-10 smaller coins that you like and that you think have potential. Spread your money out evenly. In a years time, some of those coins may be worth 10-100x what they are worth today. (Ronnie's suggestion: Basically an even spread of all of the coins listed above.)
If you are going to use Coinbase, I would get started NOW filling out your Coinbase account, since it can take a few days for them to verify your identity. I have a share link that you can use. We both get $10 in bitcoin if you sign up and buy or sell more than $100 worth of crypto. https://www.coinbase.com/join/5914022c3930d50af57db883
Happy Trading,
Ronnie!