Cryptos are back with a bang in this year’s trade. Market leaders Bitcoin and Ethereum are up by 86 per cent and 61 per cent so far this year, while other significant names, including Ripple and Cardano, are also trending up.
With the increased momentum being seen in these names, markets are worried that the investor population may get more complacent like in April 2021.
Last time, markets witnessed the “fear of missing out” phenomenon, in which investors entered unthinkingly on any significant technical breakouts in the crypto pairs.
This happened when critical levels like Bitcoin broke above $32,000 in late December 2020, or when Ethereum broke above $2,000 in April 2021.
While the jury is still out on whether we are back on the verge of another speculative panic-buying wave, investors are increasingly considering diversifying their overall crypto portfolio concentration risk.
The horror of seeing a complete portfolio wiped out within a few hours still haunts the memory of investors.
Amid this backdrop, it has become essential to diversify and maintain an overall disciplined approach towards crypto investing.
Here, we look at a few options to manage the risk against a significant crypto market downfall.
Avoid concentration risk
Look beyond Bitcoin and explore coins with multiple use cases.
Today, the crypto market is subject to thousands and thousands of individual coins and trading pairs. These belong to several sectors, including blockchain, Web3, Metaverse, non-fungible tokens, De-Fi, payment processing and core blockchain frameworks.
The crypto markets are also notorious for illegal and scam tokens.
Traditionally, while Bitcoin led the overall trading activity, today, the market has a number of alt-coins leading overall activity in their space.
Like other markets, the crypto market is subject to rotation and changes. For this reason, investors are better off allocating some part of the portfolio to well-established alt-coins.
A word of caution – sound research should be done before investing significantly in new names.
Diversification to multiple coins also reduces the risk of overexposing in just one blockchain system. For instance, in last year’s Binance blockchain hack, about $600 million was stolen.
Maintain exposure in stablecoins
Stablecoins are cryptocurrencies whose value is pegged to an individual currency or commodity.
Currently, the top market cap stablecoins peg their value to $1. The fixed peg value allows for the avoidance of any significant price distortions in a market crash.
Investors have used stablecoins to park their booked investments and trading profits in their portfolios. This ensures that the funds are available on demand.
The hassle of again converting money back from fiat to crypto is avoided. Tether and USD Coin lead the overall stablecoin market share.
The overall blockchain functioning makes stablecoin-based transactions cheaper and faster, especially for considerably large value flows.
Add exposures in the top US equity mega-cap names
Cryptos, owing to their product profile, often move in tandem with the moves in prominent US tech names.
Investors can therefore ride on the overall bullish wave in tech and crypto by maintaining exposure across both asset classes.
Investors can also look to add exposure in the top US tech names. Investing in big names like Apple, Facebook, Amazon and Alphabet ensures that the investor is also part of the overall equity growth story.
Invest in crypto trackers and alternatives
Instead of having exposure in a single large-value coin, investors can look to invest in alternate products like crypto exchange-traded funds and exchange-traded products as well as mining stocks.
Most of these products are priced lower compared to their large price-value traded coins – for example, most of the top crypto mining stocks trade below or near the $10 level.
Investors can invest in crypto-specific or blockchain sub-sector-related ETFs. ETPs are a prevalent investment vehicle in Europe.
Spread investments across platforms and exchanges
Crypto market trading is heavily skewed in favour of two to three big monopolies. Binance, the largest US exchange, controls more than 60 per cent of the daily trading volume.
Investors are better off owning their holdings across several platforms to play it safe during exchange or platform-specific events.
This is more critical as there is a lack of regulatory oversight and a proper framework for recovery mechanisms in the crypto trading domain.
Regularly monitor and rebalance the portfolio
Even if the end purpose is for long-term holdings, investors must regularly monitor and check for running portfolio profit and losses.
This ensures that investors know what’s happening with their holdings and any functional requirement to rebalance them.
Investors also need to book profits on a timely basis. The past crashes in crypto markets have very well exposed the dangers of not acting quickly.
There needs to be a balanced approach to being aggressive, while at the same time staying defensive against any significant market drop.
Vijay Valecha is chief investment officer at Century Financial
The five pillars of Islam
The five pillars of Islam
Mohammed bin Zayed Majlis
Brief scoreline:
Liverpool 2
Mane 51', Salah 53'
Chelsea 0
Man of the Match: Mohamed Salah (Liverpool)
Zayed Sustainability Prize
Killing of Qassem Suleimani
Killing of Qassem Suleimani
The years Ramadan fell in May
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
Ipaf in numbers
Established: 2008
Prize money: $50,000 (Dh183,650) for winners and $10,000 for those on the shortlist.
Winning novels: 13
Shortlisted novels: 66
Longlisted novels: 111
Total number of novels submitted: 1,780
Novels translated internationally: 66
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KILLING OF QASSEM SULEIMANI
Men's football draw
Group A: UAE, Spain, South Africa, Jamaica
Group B: Bangladesh, Serbia, Korea
Group C: Bharat, Denmark, Kenya, USA
Group D: Oman, Austria, Rwanda
UAE currency: the story behind the money in your pockets
Mohammed bin Zayed Majlis
The burning issue
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
Read part four: an affection for classic cars lives on
Read part three: the age of the electric vehicle begins
Read part one: how cars came to the UAE
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
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Killing of Qassem Suleimani
War 2
Director: Ayan Mukerji
Stars: Hrithik Roshan, NTR, Kiara Advani, Ashutosh Rana
Rating: 2/5
UAE currency: the story behind the money in your pockets
SPECS
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Killing of Qassem Suleimani
Tips from the expert
Dobromir Radichkov, chief data officer at dubizzle and Bayut, offers a few tips for UAE residents looking to earn some cash from pre-loved items.
- Sellers should focus on providing high-quality used goods at attractive prices to buyers.
- It’s important to use clear and appealing photos, with catchy titles and detailed descriptions to capture the attention of prospective buyers.
- Try to advertise a realistic price to attract buyers looking for good deals, especially in the current environment where consumers are significantly more price-sensitive.
- Be creative and look around your home for valuable items that you no longer need but might be useful to others.
Results
6.30pm: Maiden Dh165,000 (Dirt) 1,600m
Winner: Celtic Prince, David Liska (jockey), Rashed Bouresly (trainer).
7.05pm: Conditions Dh240,000 (D) 1,600m
Winner: Commanding, Richard Mullen, Satish Seemar.
7.40pm: Handicap Dh190,000 (D) 2,000m
Winner: Grand Argentier, Pat Dobbs, Doug Watson.
8.15pm: Handicap Dh170,000 (D) 2,200m
Winner: Arch Gold, Sam Hitchcott, Doug Watson.
8.50pm: The Entisar Listed Dh265,000 (D) 2,000m
Winner: Military Law, Antonio Fresu, Musabah Al Muhairi.
9.25pm: The Garhoud Sprint Listed Dh265,000 (D) 1,200m
Winner: Ibn Malik, Dane O’Neill, Musabah Al Muhairi.
10pm: Handicap Dh185,000 (D) 1,400m
Winner: Midnight Sands, Pat Dobbs, Doug Watson.
More from Neighbourhood Watch:
What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
The Voice of Hind Rajab
Starring: Saja Kilani, Clara Khoury, Motaz Malhees
Director: Kaouther Ben Hania
Rating: 4/5
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Read more about the coronavirus
Farage on Muslim Brotherhood
Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, Leon.
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
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Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
UAE currency: the story behind the money in your pockets
match info
Manchester United 3 (Martial 7', 44', 74')
Sheffield United 0
KILLING OF QASSEM SULEIMANI
Company profile
Name: Fruitful Day
Founders: Marie-Christine Luijckx, Lyla Dalal AlRawi, Lindsey Fournie
Based: Dubai, UAE
Founded: 2015
Number of employees: 30
Sector: F&B
Funding so far: Dh3 million
Future funding plans: None at present
Future markets: Saudi Arabia, potentially Kuwait and other GCC countries
UAE currency: the story behind the money in your pockets
Killing of Qassem Suleimani
Banned items
Dubai Police has also issued a list of banned items at the ground on Sunday. These include:
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Political flags or banners
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Bikes, skateboards or scooters
Mohammed bin Zayed Majlis
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More on Quran memorisation:
How to get there
Emirates (www.emirates.com) flies directly to Hanoi, Vietnam, with fares starting from around Dh2,725 return, while Etihad (www.etihad.com) fares cost about Dh2,213 return with a stop. Chuong is 25 kilometres south of Hanoi.
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
More on animal trafficking
