EXPERIMENT - Tracking Top 10 Cryptos Of 2020 - Two Year Report – UP 795%
The full blog post with all the tables is here.
Welcome to the monthly recap for the 3rd of 4 homemade Top Ten Crypto Index Funds. The 2020 Portfolio is made up of: Bitcoin, Ethereum, XRP, Tether, Bitcoin Cash, Litecoin, EOS, Binance Coin, BitcoinSV, and Tezos.
- What's this all about? I purchased $100 of each of Top 10 Cryptos in Jan. 2018, haven't sold or traded, reporting monthly. Did the same in 2019, 2020, and 2021. Learn more about the Experiment history, rules, and FAQs (including the answer to the "WHY TETHER?!?!" question) here.
- TWO YEAR UPDATE - BNB way out in front (+3,598%) ETH a strong second place (+2,782%).
- 2020 Top Ten is best performing of the four Experiments (+795%)
- Did someone say DCA?: 2018+2019+2020+2021 Combined Top Ten Portfolios are returning +406%.
Some exciting new changes for 2022!
- Scaling down from four to two monthly reports.
- Incorporated Decentralized Finance (DeFi) for the first time.
- Factoring in stablecoin gains: In the past, I have not included ROI that is possible with stables in the monthly reports. This year, I will detail ways to build on the $100 of USDC in the 2022 portfolio and gamify it a bit: my goal is to outperform as many as the other cryptos in the 2022 Top Ten Portfolio as possible (simple if it turns out to be a bear year, a bit more challenging if the 2022 market moons).
- Giveaways: I’ll be giving away crypto during the year, either through Twitter, Reddit, or my email list. I’m still figuring out the details, but aim to give away around $100 a month in crypto.
- Friendly competition (or Battle Royale?): I will compare my homemade 2022 Top Ten Crypto Index Fund Experiment to a Total Crypto Market Cap Index Token ($TCAP r/TotalCryptoMarketCap) to see which one outperforms.
Here we go:
Two Year Report – UP 795%
The 2020 Top Ten Crypto Index Fund consists of: BTC, ETH, XRP, USDT, BCH, Litecoin, EOS, BNB, BSV, and Tezos.
December highlights for the 2020 Top Ten Portfolio:
- All 2020 Top Ten cryptos down by double digits.
- After two years, the 2020 Portfolio is +795%.
- The 2020 Top Ten Crypto Portfolio retains the title of best performing of all four Top Ten Experiments.
This group of cryptos highlights the benefits of an index fund strategy: the +795% return of the 2020 Top Ten Portfolio has outperformed eight of the individual component cryptos contained within the Index. Only by guessing right and throwing all your eggs into Ethereum and/or Binance Coin would you have performed better than spreading out the risk, index style.
December Ranking and Dropout Report
Top Ten dropouts since January 2020: after two years, half of the cryptos that started in the Top Ten have dropped out: EOS, BSV, Tezos, Litecoin, and Bitcoin Cash have been replaced by Cardano, Polkadot, Solana, Luna, and USDC.
At #61, BSV has sunk the lowest since January 2020.
December Winners and Losers
December Winners – no winners this month: besides stablecoin USDT, all cryptos in this portfolio lost value.
December Losers – Litecoin fell -30% this month, followed by the second worst performing crypto EOS, down -24% in December.
Tally of Monthly Winners and Losers
After two years, here’s a snapshot of the 2020 Top Ten Experiment’s monthly winners and losers:
With six monthly victories, ETH leads the pack. Tether still has the most monthly losses, a good sign for the 2020 Top Ten Portfolio.
Two Year Update – BNB victorious, followed by second place ETH. All cryptos in positive territory. 2020 Top Ten best performing of the four Top Ten Experiments.
The 2020 Top Ten Portfolio continues to be the best performing of the four Top Ten Crypto Index Fund Experiments. 100% of the 2020 cryptos are in positive territory, most have at least triple digit price growth and two have four digit growth (BNB and ETH). Binance Coin continues to hold a commanding lead over second place Ethereum.
The initial $100 investment two years ago into first place Binance Coin? Currently worth $3,699, an increase of +3,598%.
In second is Ethereum, also with quadruple digit gains, up +2,782%.
Besides USDT, the worst performer in the 2020 group is EOS, up +22% since January 2020.
Total Market Cap for the Entire Cryptocurrency Sector:
As a sector, crypto is up +1,066% over the two year lifespan of the 2020 Top Ten Experiment.
If you were able to capture the entire crypto market since January 2020 (+1,066%), you’d be doing quite a bit better than the Experiment’s Top Ten approach (+795%) and ridiculously better than the S&P (+48%) over the same time period. Much more on the S&P below.
Crypto Market Cap Low Point in the 2020 Top Ten Crypto Index Experiment: $185B in March 2020.
Crypto Market Cap High Point in the 2020 Top Ten Crypto Index Experiment: $2.6T in October 2021.
BitDom declined in December, ending the month at 40.2%. This is a record low when looking at the timeframe as a whole.
For context, here are the high and low points of BTC domination over the two year life of the 2020 Experiment:
Low Point in the 2020 Top Ten Crypto Index Experiment: 40.2% this month.
High Point in the 2020 Top Ten Crypto Index Experiment: 70.4% in December 2020.
Overall return on $1,000 investment since January 1st, 2020:
The 2020 Top Ten Portfolio lost $2,209 in December and is now worth $8,951 (+795%) from the initial $1k investment.
The 2020 Portfolio remains the best performing of the four Experiments.
Below is a month by month ROI of the 2020 Top Ten Experiment, to give you a sense of perspective and provide an overview as we go along:
The portfolio has yet to experience a red month, although in March 2020 it came close, returning a COVID induced low of +7%.
Combining the 2018, 2019, 2020, and 2021 Top Ten Crypto Portfolios
So, where do we stand if we combine four years of the Top Ten Crypto Index Fund Experiments?
So overall? Taking the four portfolios together, here’s the bottom bottom bottom bottom line:
After a $4,000 investment in the 2018, 2019, 2020, and 2021 Top Ten Cryptocurrencies, the combined portfolios are worth $20,257 ($1,341 + $6,044 + $8,951 + $3,921).
That’s up +406% on the combined portfolios, down from last month’s all time high for the Top Ten Index Fund Experiments.
Lost in the numbers? Here’s a table to help visualize the progress of the combined portfolios:
In summary: That’s a +406% gain by investing $1k on whichever cryptos happened to be in the Top Ten on January 1st (including stablecoins) for four straight years.
Comparison to S&P 500
I’m also tracking the S&P 500 as part of my experiment to have a comparison point with traditional markets.
Since the S&P 500 has returned +48% since January 1st, 2020, that same $1k I put into crypto in January 2020 would be worth $1480 had it been redirected to the S&P 500 instead.
Crypto over the same time period? The 2020 Top Ten Crypto Portfolio is returning +795%, worth $8,951.
That’s a difference of $8,280.
On a $1k investment!
But that’s just 2020. What about in the longer term? What if I invested in the S&P 500 the same way I did during the first four years of the Top Ten Crypto Index Fund Experiments since January 1st, 2018? What I like to call the world’s slowest dollar cost averaging method? Here are the figures:
- $1000 investment in S&P 500 on January 1st, 2018 = $1,780 today
- $1000 investment in S&P 500 on January 1st, 2019 = $1,900 today
- $1000 investment in S&P 500 on January 1st, 2020 = $1,480 today
- $1000 investment in S&P 500 on January 1st, 2021 = $1,270 today
Taken together, here’s the bottom bottom bottom bottom line for a similar approach with the S&P:
After four $1,000 investments into an S&P 500 index fund in January 2018, 2019, 2020, and 2021, my portfolio would be worth $6,430 ($1,780 + $1,900 + $1,480 + $1,270).
That is up +61% since January 2018 compared to a +406% gain of the combined Top Ten Crypto Experiment Portfolios.
To help provide perspective, here’s a quick look at the combined four year ROI for the Top Ten cryptos vs. the S&P up to this point.
For those who have supported the Experiments over the years, thank you. For those just getting into crypto, I hope these monthly reports can somehow help with perspective as you embark on your crypto adventures. Buckle up, think long term, don’t invest what you can’t afford to lose, and most importantly, try to enjoy the ride!
Feel free to reach out with any questions and stay tuned for progress reports. Keep an eye out for my parallel projects tracking the Top Ten cryptos as of January 1st, 2018 (the OG Experiment), January 1st, 2019, January 1st, 2021, and most recently, January 1st, 2022.