Should I Invest In Altcoins During the Bitcoin Gold Fork (And SegWit2x Fork)? Or, Should I Invest in Bitcoin? Or, Should I Move to Fiat?
UPDATE: Alts boomed after the Gold fork… and they boomed after the Segwit2x fork cancellation was announced. Thus the answer in both cases was essentially “yes.”
Here is the deal, Bitcoin has a hard fork coming up on either Oct. 25, block 491,407, or something else (depending on who you listen to) and that has been causing Bitcoin mania. That is, crypto investors have been going heavy into BTC and lite into Altcoins.
That has resulted in lower prices for many top coins by market cap.
Thus, one wants to know “is this a good price to buy alts?” The answer to that then depends on what happens after the fork.
Does everyone flood out of BTC after they capture their free coins and go into alts? Or does everyone go into fiat and stay out of crypto? Or, does everyone just “hodl?”
There is really no answer here, but one gets the sense that flooding out of BTC is likely and going into alts or fiat is likely. [UPDATE: That is indeed what happened, although this reversal was short lived as everyone piled back into BTC for the mid-Nov Segwit2x fork. Watch for this same pattern after the Segwit2x fork.]
The problem is, this doesn’t answer the question of whether one should pull out into fiat and wait for better prices (in BTC and alts), stay in Bitcoin, or dollar cost average into alts on the way down.
The point of this page isn’t to offer you a suggestion. Rather, its to make you aware of those choices.
Don’t forget though, SegWit2x fork is coming up in November… and like, that also splits Bitcoin and creates more coins essentially. The difference with that and Bitcoin Gold’s fork is that Bitcoin Gold is meant to live on its own. Meanwhile Original Bitcoin and SegWit2x Bitcoin seem poised to try to destroy each other (where the stronger coin kills the other; “there can be only one” as they say).
Thus, we can’t assume the SegWit2x fork will create the same environment as Bitcoin Gold did. However, if it does, that means BTC will likely see another run up and alts will be lucky to catch even a little tailwind.
Between upcoming regulations (expected, not certain), the forks, and the slowly growing and sometimes diminishing altcoin market, these are bizarre and strange times in crypto investing.
If you are a new investor, know these are exciting and scary times. If you are seasoned, don’t forget that we are on a roller coaster and as much upside is there is, many bits are stacked against crypto.
There is reward here, and there is risk. Where is that risk/reward though? Do we place bullish or bearish bets? And do we place them on BTC and its forks, or do we look to the top Alts by market cap?
Again, hard to say. All I know is that you’ll have a better time figuring it out if you are aware of what is happening in crypto and are aware of what questions you should be asking yourself. To those ends, I hope the article above offered you insight.
The one bit of advice I can give you: Watch the markets like a hawk for the next few days. Block 491,407 is very important, and so is the 25th. If something big is going to happen. Logically we can suspect it will happen at or as a result of those snapshots in time.
UPDATE: This article was clearly written before the Bitcoin Gold fork. To update you, alts dipped like crazy before the fork and then spiked right after the fork (offering amazing gains for those who bought alts right before the fork and then took profits quickly). Watch for this to happen again with Segwit2x. See a page on where alts are at now post fork.
NOTE: Clearly, to avoid risk, moving into fiat is the only call. When you invest in crypto you are putting on your “+1 adventures’ cloak of risk taking.” That cloak gives you a chance at the upside… but those who have put on those cloak have lost big in the past. It can happen to anyone. So proceeded at your own risk for Bitcoin Gold and Segwit2x whatever your move is. Bitcoin could crash starting at Block 491,408… or it could go to the moon. It could take the top alts with it, or it could sink them, or it could have little effect on them. No one knows.