Ask HN: You have $100/mo to invest in cryptocurrency, BTC, BTC Cash or Ether? | Hacker News Reader

Ask HN: You have $100/mo to invest in cryptocurrency, BTC, BTC Cash or Ether?

35 pointsiDemonix48 comments

I have some expendable income every month and I'd like to have a stake in cryptocurrency. I find it interesting but my attention span is short, so having some funds involved would make it more interesting, and it's money I can afford to lose.

Obviously they're all a gamble, but I'm interested to hear which one people would pick. Bitcoin cash seems a bit unsteady with it being new, Bitcoin appears to be stronger than ever (when I thought the fork would lower its value) and Ethereum is backed by some fairly big names and recovering from its dip.

On a sidenote, if anyone has a platform to recommend feel free, as all I've been recommended is markets.com.

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Whatever you decide, set it up on a daily, weekly, or monthly deposit. Then forget about it. Delete all your crypto news alerts, take off all your crypto book marks. Do everything you can to take yourself out of the equation once the thing is set. Keep it boring, keep it consistent. Emotion is your greatest enemy while investing. But you're smart and you know all this.

Definitely a great idea — I'm not sure if there are any limitations around buying and selling small fractional amounts of cryptocurrencies, but if there aren't, dollar-cost averaging is a great idea to apply.

https://en.wikipedia.org/wiki/Dollar_cost_averaging

Upvote. I have done this on Coinbase. I have recurring daily transactions created for Bitcoin and Ethereum, putting in $5 each. Coinbase charges me $0.15 in fees (3%) for each transaction. I realize that the fees have increased since I set this up, but I guess I'm grandfathered in.

FWIW, I've been lately thinking of adding an extra $2.50 each per day for Litecoin and Bitcoin Cash.

As another poster has pointed out, dollar-cost averaging is your friend.

Is there an advantage to daily over weekly/monthly? It seems to me like w/m would make more sense as you'd get less fees?

The fees are percentage based, so the investment interval doesn't matter. $5/day gets you a $0.15 fee, $35 a week is $1.05. It all nets out to the same dent made.

Which marketplace are you getting those fees from? I'm looking at Coinbase and its fees are quite a lot higher than that for using a Credit Card, and bank transfers cost a lot more.

Re: Coinbase, I have it setup to debit my bank account every day. The transactions go through between 2.45-3 PM EST daily, with 3% fees.

However, I just tried setting up a new transaction and the fee looks to be $0.99 for a $5 investment. At ~20%, this sort of averaging would no longer be worth it. Like I said before, I guess I've been grandfathered in after the new fees schedule was imposed. Let's see how long it lasts.

Honestly, why take the risk? If you are looking to invest long-term, just buy an index fund like $QQQ or $SPY and sit back and let it ride. You can use Robinhood to continue to buy without paying commissions (which is going to be crucial since commissions would take a large percentage on such a small investment amount).

Or setup a Vanguard account and enjoy free Vanguard ETF trades w/ ability to re-invest dividends as partial shares.

Cryptocurrency has low beta and offers great diversification benefits especially in low amounts specified by OP.

Why not actually gamble? For $1200/year you can have a couple fun trips to Reno (or somewhere else that isn't Las Vegas, which is way too expensive to be a low-stakes gambler). No legal or tax ambiguities unlike cryptocurrencies, free drinks and other comps -- its not a bad way to spend money you can "afford to lose".

I'm in the UK and I don't really find casino-style gambling fun, plus it's all over pretty quick. I agree there are plenty of ways to spend 'afford to lose' money, but I'm a geek and cryptocurrency piques my interest.

Why not diversify your portfolio and invest in all three? Coindesk.com supports BTC and ETH, though not BTH.

I did think this originally, but I didn't really want to put much more $ in as it's 'for fun' more than anything, and $33 in to each didn't seem as good as $100 in to one, but I suppose diversification is probably the best way.

The problem with diversifying hundreds of dollars is it does not move the needle. What's earning 7% a year on $100, earns you a large Starbucks.

Now this completely changes once you get above 20k invested. Then, diversity is more important and earning 7% a year moves the needle.

Bitcoin has historically gone up much faster than 7% a year and can go down much faster too. Currency being what it is, it is to everyone's benefit to eventually agree on one. In most cases, it is not useful to diversify, but with crypto's make or break, your $100 could be worth $100k in the future or $0.

Check out r/NEO on reddit and learn on http://neo.org

One thing that makes NEO cool is that it generates another coin in it's ecosystem called GAS which you get for just holding it in your wallet. Make sure you move NEO from an exchange unless you're using Binance (which lets you generate GAS on the exchange)

It just hit Top 10 on http://coinmarketcap.com yesterday

I started reading up on NEO but found it more confusing than the rest! It certainly seems to have made a few early investors some $$$ on Reddit, however.

NEO is backed by Chinese venture capital.

Unlike other more open and honest or at least auditable crypto currency systems, NEO aka antshares was 100% premined which is incredibly dubious and indicative that many of the shares were selectively distributed to individual 'whales' who can and will easily dump their holdings.

There is no "premine" -- they were created, locked, and distributed.

Semantics.

Premine is a term for cryptocoins where traditionally, the start date of the network is announced after the mining protocol and software is released to the public.

When a cryptocoin dev team intentionally takes control of part of the supply of the cryptocoins before releasing the minting protocol/process/supply to the general public then it's considered 'pre-mined' because traditionally as with BTC/LTC/DOGE/etc, the public was informed of the protocol and presumably all users given access to generate the coins as a reward for fueling the network activity.

In the case of antshares, the basecoin being %100 premined would almost seem more like a stock in the project as apparently coin ownership is a precursor to generating the secondary token which is used as fuel for the services provided.

Are we talking long term investment, or do you want to play with speculation? If they first, I'd say it's neither - just go with some real fund, possibly via your bank. If you want to speculate - all of them. Setup a few buy orders at various levels below current price and wait for the next big event / crash / exchange fail / ...

The latter really, more for fun and experience as I've never done anything remotely like this.

If you live outside of the US, consider investing in an index fund that tracks multiple cryptos: https://www.iconomi.net/dashboard/#/INDEX

I'm in the UK, but what makes this better outside vs. inside the US?

Americans are not allowed to invest in it (yet).

Ah, that makes sense then, thanks for the swift reply.

Investing is about creating assets and having a diversity of assets. Assuming that $100/month is one part of your expendable income that you have considered for crytocurrency - you are in good hands. However if you are putting 100% of your expendable amount in cryptocurrency - do revisit other options.

Do also go through https://www.wealthfront.com/questions and other finance portals to see how they allocate your investments amount based on risk profile, age and goals.

Ask yourself,

What's the personal value to me or someone else of owning this unit of currency, in terms of purchases enabled and transaction costs avoided?There are frequently financial bubbles, where people just buy because you expect the value to see further appreciation and sell to a greater fool. Unfortunately such bubbles inflate slowly but collapse rapidly:

https://en.m.wikipedia.org/wiki/Tulip_mania

It really depends on your objectives. Just want to save some fiat? Go 85% BTC/15% ETH this way you can ride the BTC price rises and still enjoy xx% gains on ETH. Or you can do what the most opportunistic do and go 100% ETH and then diversify that into ERC-20 tokens built on top of the Ethereum protocol. Now obviously you should do your due diligence but hopefully this can give you some ideas.

But if you go 100% ETH, make sure you watch Rootstock very closely http://www.rsk.co/.

Executing the Ethereum VM and smart contracts on the Bitcoin blockchain...

Not BTC or Ether. And in no way Bitcoin Cash. As i invested a bit more time in Cryptocurrencies, i'm mainly looking for newer coins that could have a bright future (always read and understand whitepapers).

I would currently go for Wagerr, IOTA, SIA and TenX. For IOTA and TenX, i still need to read the Whitepaper in Detail, but they look very promising.

I'd go all in on Iota.

Transactions without a fee, Scalable. Meant for Machine to Machine Payments. The internet of things, nano transactions.. Doesn't use a blockchain but instead uses a Tangle. It's quite early and the tech may seem new but it does solve a lot of the scaling issues wrought with "blockchains".

I should point out that I'm in the UK, if that makes a difference.

Questions like this are showing that the bubble is about to pop...

I own about 30 different currencies, all stored on paper wallets. I recommend avoiding "wealth centralization" on any one currency.

30 different cryptocurrencies? How do these paper wallets work? Do you keep them in a safe deposit box or something?

Neither you are literally paying people to waste electricity. Invest in a company that actually makes something people use

Look beyond headlines and you'll see that the vast majority of cryptocurrency mining is powered by regionally oversupplied renewable power. Here's the biggest in the world located in Iceland, its 100% renewable.

https://youtu.be/rsSuay53kIc

Same story in western China and the Pacific north west filed with mining company's taking advantage of hydroelectric.

some BTC and ETH, but also consider adding monero (XMR) to the mix. it's a wildcard, but it's fungible. XMR is also trending in illicit use (laundering and trafficking), which will probably help its price in the short-to-mid term.

Seems like a ridiculously off-topic question.

https://www.coinbase.com is great for simplicity. Diversifying with BTC/ETH/LTC is a good strategy to minimize risk.

You can use my referral link to earn extra BTC when you purchase :D https://www.coinbase.com/join/5927caaa2cc81a08f16dab25

https://www.gdax.com/ is a more advanced trading platform (same company as Coinbase). Expect lower fees in exchange for managing your own trades

A friend of mine that does invest in to BTC and ETH said he "wouldn't bother with LTC" but I didn't ask why and haven't looked in to it, I'll do some reading up on it tomorrow.

critical thinking:

and do you think that is anywhere near objective?

why would that qualify outside of him being the "cryptocurrency savant" and you not being one?

what would make your understanding of that statement objective?

Somehow Litecoin traded from $3.00 to $46.00 with many enthusiasts saying the same thing for half a decade, was there somebody saying something else?

Does your friend have the exact same investment risk profile as you would?

factors...

Yes, LTC went up 10x in the same timespan that almost every reasonable coin went up 10x. That says nothing about the fundamentals of LTC. LTC simply has no value proposition after segwit on bitcoin and the alt coin rennaisance.

BTC is susceptible to ASIC attacks which has inevitably lead to the network being taken over by custom hardware producers.

LTC and other coins use more resilient algos like script to prevent that type of network compromise.

There are scrypt ASICs for Litecoin as well. Anything that can be computed, will be centralized and moved to the place with the cheapest power and the loosest regulations...

There are LTC ASICs out too. LTC itself was crippled by wanting to be "cache friendly" on the CPU so its memory usage is actually relatively small.

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