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As the crypto market continues to recover from a bearish first half of 2018, investors are becoming more cautious when choosing which cryptocurrencies to invest in. And with good reason. The ability to choose which digital assets you invest in is one of the many benefits of investing in an ETF fund that offers exposure to a specific subset of crypto assets instead of simply buying and storing individual coins directly. You might already be aware that there are currently well over 1,000 different cryptocurrencies available for purchase (and counting). However, some of these ‘coins’ have little more value than a token you could create on Ethereum or another blockchain platform. When it comes to risk and reward, the top 120 coins with the highest market cap provide investors with the best opportunity for success when investing in this asset class. Let’s take a closer look…
What Is a Crypto ETF?
An exchange-traded fund (ETF) is a type of fund that owns assets (such as stocks, gold, commodities, real estate, etc.) and divides ownership of those assets into shares that are traded on a stock exchange. That’s the simplified version. Crypto ETFs have only really been a thing since early 2018 when the SEC allowed funds to start launching that is focused on investing in crypto assets. Now there are several funds listed on various crypto exchanges with different strategies and investment themes. Some specialize in only a couple of coins, while others hold a diversified portfolio of around 100 different cryptocurrencies. The most important thing to look for when selecting a crypto ETF is the underlying methodology used to select and weigh the different coins held in the fund. Some funds specialized in one specific coin, while others hold a basket of coins weighted by market cap to provide the best risk-reward ratio.
How to Determine If a Crypto ETF Is Right For You
This is the most important step when considering investing in a crypto ETF. Before you even select a fund or two to research, you need to know your risk tolerance level and what your investment goals are. Once you have those two things sorted out, you can start to look at the different funds available and compare them based on the following criteria. – Investment Themes – What sectors are these funds focused on? Are they diversified and focused on altcoins, or do they specialize in one or two coins? Are they focused on infrastructure projects, privacy coins, and/or utility tokens? – Investment Amount – Some funds allow you to invest as little as $100. However, some funds require an investment of several thousand dollars. – Fee Structure – The last thing you want to do is pay a large amount in management and investment fees. There are a few funds available that charge a management fee of 1% or less. – Security – How is the fund protected from hackers and other nefarious individuals who might try to steal from the fund? Many funds are not held in a cold storage wallet that is not connected to the internet, which is key to keeping your assets safe.
A League Table of the 120 Cryptocurrencies with the Highest Market Cap
This table includes the top 120 coins ranked by market cap, along with the underlying methodology that each crypto ETF uses to select and weight its holdings. You’ll notice that the top four coins by market cap (BTC, ETH, XRP, and LTC) are all included in the ‘Weighted’ category. This means that each fund holds a diversified portfolio of around 100 different coins, weighted based on the total market cap of each coin. The next group of funds is focused on specific sectors of the crypto ecosystem. The Privacy Coins ETF is focused on a single sector and holds only the top 5 coins in that space. The remaining funds are focused on infrastructure projects and hold between 6 and 10 different coins. If you’re looking for a fund with a low risk-to-reward ratio, the best options are the Privacy Coins ETF and the Infrastructure Funds. However, if you’re looking for a fund with a high risk-to-reward ratio, then the best options are the Bitcoin, Ethereum, and Ripple ETFs.
Bitcoin (BTC) Has The Highest Market Cap, But No Longer Has the Highest Rating
Bitcoin is the granddaddy of all cryptocurrencies, but it’s also the riskiest one to invest in. It currently holds the highest market cap of all the coins, but it’s not the highest-rated crypto in terms of risk-to-reward ratio. That title now goes to Ethereum. Bitcoin has a low-risk rating, but a high reward rating. This means that investors need to be very careful when selecting how much they want to invest in BTC. If you want to bet big on the future of crypto, then holding a small percentage of your assets in BTC is a very smart move. However, if you want to invest a significant portion of your net worth into the crypto market, then you’re better off focusing most of your funds on ETH.
Ethereum (ETH) Has Highest Rating, But is Ranked Number 2 In Terms of Market Cap
Ethereum may no longer have the highest market cap (it’s now ranked number 2 by market cap), but it has the highest risk-reward rating of all the coins. Ether is currently a very promising platform that is likely to see increased adoption and use cases in the next few years. The risk of investing in ETH is also significantly lower than that associated with investing in BTC. If you’re interested in investing in ETH, then the best option is to simply purchase the coin and hold it in a cold storage wallet. There is currently only one crypto ETF that holds Ether, and it is ranked number 2 on our table.
Ripple (XRP) has High Ratings, but the Lowest Market Cap of All Reviewed Coins
Ripple is another very promising blockchain project, but it’s not quite as well known as Ethereum is. That’s not to say that it doesn’t deserve the same level of attention. The Ripple project has the potential to change the way we transfer funds globally. The only downside is that XRP is currently only used by a handful of banks and financial institutions. Once this changes, the value of this token is likely to skyrocket. The best option for investing in XRP is to simply purchase the coin and hold it in a cold storage wallet. There is currently only one crypto ETF that holds XRP, and it is ranked number 4 on our table.
Litecoin (LTC) and Bitcoin Cash (BCH) Have High Rankings, But Are Rated Very Low
Litecoin has long been viewed as the silver to Bitcoin’s gold, but recent developments and partnerships in the BCH camp have caused many to question LTC’s long-term viability. However, LTC still holds a spot in the top 10 coins by market cap, so it’s a viable option for investors. It just needs a bit more time to prove its worth. If you’re interested in investing in either LTC or BCH, then the best option is to simply purchase the coins and hold them in a cold storage wallet. There is currently only one crypto ETF that holds BCH, and there are two that hold LTC.
Dash is Ranked Very High But Has Lowest Market Cap of All Reviewed Coins
Dash is another coin that is well-known in the crypto community, but it is not used as widely as either of the two coins above. That doesn’t mean that it doesn’t have promising potential, it just means that it has a slightly lower chance of increasing in value over the next few years compared to LTC and BCH. If you’re interested in investing in DASH, then the best option is to simply purchase the coins and hold them in a cold storage wallet. There is currently only one crypto ETF that holds DASH, and it is ranked number 6 on our table.