Original Author: Frank America
Original source: medium
Original title: Invest in BTC and ETH and Forget the Rest
Compiled by: Lu Jue Lin, GWEI Research
L1 reigns supreme
A recent poll on Twitter asked participants whether they would prefer to hold ETH over any other ERC-20 token over the next five years. Despite the small sample size, the results are 100% in favor of holding ETH. To me, this is an indicator of market sentiment towards the power of the thriving L1 blockchain. ERC-20 tokens include major Stablecoin like DAI, USDT, and USDC, as well as major MEME coins like SHIB and PEPE. These tokens have a combined market capitalization in the tens of billions of dollars, yet they are all built on top of Ethereum, further ensuring that the base layer matters in every transaction.
The same goes for Ordinals on the Bitcoin blockchain. BRC-20 tokens — despite some criticism — have increased the demand and usage of the Bitcoin blockchain, and any value generated through Ordinals can only further ensure the importance of the base layer. In some ways, the Ordinals mania can be seen as a DDOS attack, to which the Bitcoin blockchain is resilient. A DDOS attack is when a server becomes overloaded with repeated requests and eventually shuts down. This is usually performed using some type of robot. When the Bitcoin blockchain receives an influx of activity, it is able to scale and process blocks as usual, but with higher transaction fees.
One argument is that if you want to win in a cryptocurrency casino, steer clear of volatility. Statistics tell us that it is better to be strategic at the blackjack table than to be lucky with the randomness of the slot machines. While you can win more with one pull of the slot machine, the risk increases exponentially. By understanding the risk profile of a cryptocurrency casino, you can keep it alive and possibly even thriving.
Think how cool it feels to walk out the gate as a winner...
Spend your money where the odds are high
This means avoiding speculation on meme tokens, untested L1 blockchains and surging ERC-20 or BRC-20 tokens that will (yes, some will) beat the base layer in the short term native token(ETH/ BTC) income. The conservative idea is to put your money in the safest spots of the casino - those that statistically offer the best odds for players - and Hodl.
For each of these gambles (MEME Coin, Alt L1, ERC/BRC-20), you are increasing the risk of your financial portfolio, thus statistically reducing your chances of winning in this crab market. Some cryptocurrency economists believe that the next bull run may begin around Bitcoin’s next halving cycle in the second quarter of 2024 — despite macroeconomic trends. But until then, enjoy your beach right now and enjoy the crab market.
What is the crab market?
The crab market can be defined as "turbulent, sideways, and follow the trend". We've been trading sideways for a while, and if you want to live another day, the financially prudent should look back for all their value into the two most famous blockchains, Ethereum and Bitcoin, which Blockchains have proven over multiple cycles that they are the best option for securing your future prosperity.
Bitcoin and Ethereum are the least risky L1s
Bitcoin started in 2009 and has been through every market boom and bust since then, consistently hitting ATH-time highs. Therefore, the token is the least risky asset and most likely to return profits to those who invested in it. Launched in 2014, Ethereum has seen every boom and bust since its inception, and like Bitcoin, Ether has always resurfaced to hit ATH. Holding these two assets, which are also the two cryptocurrencies with the highest market caps, constitutes the least risky bet in cryptocurrency.
With more than $1.1 trillion in value pouring into the cryptocurrency market, it's safe to say that its roots are strong and its offshoots are thriving. Do you want to be the next crypto millionaire? I wouldn't, if it meant I'd lose shirts on meme coins, high-stakes Alt L1 bets, or JPEGs that might suddenly be worthless. Instead, I'll be making small profits on the two highest utility blockchains, year after year for a decade - thank you. If you want to protect your wealth with the greatest potential for returns, not the energy you put into the market, then your task is simple, buy Bitcoin and Ether regularly right now and chill out.
Within the statistics of this casino, despite external market factors, and given the cyclical behavior of these markets, I believe anyone who sticks to this philosophy over the long term will prosper financially.
