Bitcoin vs. Altcoins: Should You Diversify Your Crypto Portfolio?

To many, Bitcoin was an introduction into the world of cryptocurrency. It's the largest, most established, and often viewed as a "safe" option for long-term investment. However, with the crypto space continuing to expand, a growing number of traders are exploring the world of altcoins-smaller, lesser-known cryptocurrencies that offer potentially higher returns. So, should you stick with Bitcoin or branch out into altcoins?

Why Bitcoin Remains King:
First-mover advantage suggests that Bitcoin will continue to be the most prevalent cryptocurrency. In addition to a capped supply of 21 million coins and growing institutional acceptance, many investors are now viewing Bitcoin as a store of value much like gold. Perceived to be an inflation hedge, even with the price of Bitcoin showing extreme volatility, it has actually appeared to appreciate over time.

Are you a Bitcoin maximalist or do you think altcoins can outperform Bitcoin? What's your favorite altcoin?

The Case for Altcoins:
While Bitcoin is still the king of crypto, many altcoins have jumped in popularity, offering faster transaction times, lower fees, and a variety of other unique use cases. Ethereum, for one, powers the entire DeFi and NFT ecosystem and has therefore become an indispensable component in the crypto world. Other altcoins, like Solana, Cardano, and Polkadot, are pushing some really exciting innovations that could drive even bigger adoption. But remember, altcoins also carry higher risks since their futures are way more uncertain compared to Bitcoin.

Which altcoin do you think has the most potential to succeed long term? Are you more focused on the technology behind altcoins, or the potential for short-term gains?

How to Diversify Your Portfolio:
This is why many professional traders will encourage diversifying your crypto portfolio as a hedge. If you have a mix of Bitcoin and a few altcoins, you can sometimes grab gains from some of those smaller, high-growth projects while having the stability that Bitcoin offers. But out of thousands of choices, which will be good investments?

Is diversification part of your investment strategy? If yes, how do you decide which altcoins to invest in? What worked with regard to crypto investment management?