As crypto markets mature, we see increasing value in focusing on broadly diversified portfolios of tokens.

If the last two years prove to be a template for the pace and diversity of innovation going forward, then a diversified portfolio should provide better risk / return metrics.

Backtested results indicate that a more broadly diversified portfolio (Top 75, 100) offers better value than a minimally diversified portfolio (Top 10).

We view the crypto landscape as an ‘expanding cone’ of investable assets, with an increasing number of credible projects across different use case.

In Part I of this series, we examined the return profiles of broad baskets (Top 50+) of cryptocurrencies vs a simple BTC/ETH or Top 10 strategy, showing that such diversified strategies have worked recently, and hold potential for the future.

We also acknowledged that this premise really hinges on a diverse range of cryptocurrencies having actual value. The huge amount of outright speculation in crypto may often overshadow the real long-term value being built by many blockchain projects, but we believe it exists.

In this piece we want to dig into this broad world of innovative projects and discuss how we see the universe of investable projects growing (the “expanding cone” which we referenced in our prior piece).

As crypto markets mature, we see increasing value in focusing on broadly diversified portfolios of tokens.

If the last two years prove to be a template for the pace and diversity of innovation going forward, then a diversified portfolio should provide better risk / return metrics.

Backtested results indicate that a more broadly diversified portfolio (Top 75, 100) offers better value than a minimally diversified portfolio (Top 10).

We view the crypto landscape as an ‘expanding cone’ of investable assets, with an increasing number of credible projects across different use case.