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Investing In Bitcoin & Ethereum Is NOT The Best Way To Make Money In Crypto

Contrary to popular belief, investing in Bitcoin and Ethereum is not the best way to make money in the crypto market. Find out why!

By Rhys McIntyrePublished 3 years ago 4 min read

Digital currencies have been around for quite some time, but more recently have taken the spotlight as more people are seriously considering them as a good investment.

One opinion that seems to be quite unanimous among crypto investing communities, is that the titans of the industry are the best possible investment.

When I say titans of the industry, I am talking specifically about Bitcoin and Ethereum.


Bitcoin has become the grandfather of the cryptocurrency world, established back in 2009 as an electronic peer-to-peer cash system. Ethereum, created in 2015, is the open source blockchain (decentralized public leger) of which Ether is the native cryptocurrency for the platform.

These two digital currencies are arguably the largest in terms of market capitalization, however their similarities essentially end there. They were developed for different reasons, and as a result have completely different use cases and internal dynamics. But lets save that discussion for another article.

The point here is that Bitcoin and Ethereum have become the safest and most popular cryptos for investors to park their money and feel confident about seeing a healthy return over time.

Upside Potential

Currently, Bitcoin and Ethereum are currently fluctuating right around their all time highs in terms of coin value. Despite a lot of speculation from a large part of the crypto community that says they will continue to rise, their upside potential is limited.

Upside potential refers to the ability of an investment to increase in value, measured in dollar value or percentage.

The reality of the upside potential of Bitcoin and Ethereum is that it is fairly limited, simply because of the fact that they have already experienced large increases, and have both have incredibly high market caps.

Market capitalization, often referred to as “market cap” for short, refers to the total dollar market value of the outstanding shares, or in this case coins. This is calculated by multiplying the total number of outstanding coins by the current market price of one coin.

An example of this would be a company who has 10 million coins selling for $10 each, creating a market cap of $100 million. This is a direct indicator of the dominance and popularity of cryptocurrencies.

Large Cap Vs. Small Cap Coins

The argument that Bitcoin and Ethereum investments are not the best way to actively make money in the crypto market is made clearer by the discrepancies between large cap and small cap coins.

Large cap coins like BTC and ETH are ones that have a market capitalization of more than $10 billion. These are inherently the most well known coins, and in many ways the safest investment plays.

Small cap coins fall within the market capitalization range of $100 million to $1 billion. These are often not as well known as larger cap coins, and will not have the same credibility as bigger projects like Bitcoin and Ethereum.

The important thing to remember here is that large cap coins will always be a safer investment than small cap coins, but will not provide the same potential for substantial growth over a short period of time.

A small cap coin with a market cap of $100 million has significantly more short-term growth potential than a coin with a market cap that exceeds $10 billion.


Now that we have covered these important concepts, lets get down to the meat of our argument.

The unavoidable truth is that Bitcoin and Ethereum are incredibly strong projects, and arguably provide the safest possible crypto investment options at this point in time.

However, their upside potential is somewhat limited. In other words, their value will inherently not experience as much growth or decay (volatility) as lower cap coins.

If you are looking to actively trade (not just invest and walk away), there is a substantial amount of money to be made in smaller cap coins. These coins have the potential to grow by 10, 100 even 1000 % in a short period of time. Something that just simply cant happen with large cap coins.

Now obviously, the numbers can go both ways. If a project can see a 100x explosion over night, you can bet that the opposite is also possible. This kind of trading is risky.

The name of the game is VOLATILITY. Small cap coins are simply more volatile than large cap coins, and this in large part due to the size of their market capitalization, which we discussed previously.

Whether you are equity trading or trading crypto currency, volatility equals potential. And that is exactly where my point here today is made.

If you are looking to make some real short-term gains in the digital currency space, buying large cap coins like Bitcoin and Ethereum is truly not the best way to do it.

Small cap coins that have significant short term upside potential are the best way to realize incredible gains.

This doesn’t mean you should dump a bunch of money into the first few projects that show up on your Google search.

Do your research, consult with the reliable communities and forums that exist, and feel confident investing in a few coins that have real potential.

$2000 strategically invested in strong, small cap projects can go a hell of a lot farther than the same amount invested in Bitcoin or Ethereum.

The potential is endless.

With that being said, always remember to take profits while they exist. Greed is often the downfall of many inexperienced investors.

Good luck to all, wishing you the best of luck!

Disclaimer: This is not financial advice, simply a financial opinion


About the Creator

Rhys McIntyre

Professional Online Content Writer & Editor

Canadian Born & Raised

Science Grad - Undercover English Major

Experience & Advice | Entertainment & Education | BSc

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    Rhys McIntyreWritten by Rhys McIntyre

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