The crypto markets are getting back their lost momentum, and the prices of popular digital assets like Bitcoin are high like never before.
As Bitcoin continues upward, so does the number of new investors who want a piece of the pie.
In particular, Bitcoin, officially regarded as the world’s first and biggest cryptocurrency, still dictates market trends and serves as a safe-haven asset or store of value for many investors.
A decision like what asset to invest in might just be a very cumbersome choice for investors entering the market-in particular, those new in cryptocurrency. Should you invest in Bitcoin, the established market leader, or venture forth onto more speculative terrain, where the return might be higher but risk as well? This article looks at why Bitcoin continues to be a strong investment during this Bull Run and also covers the opportunities that altcoins bring to the table.
Bitcoin Remains the Go-To Investment in a Bull Market
Bitcoin has, quite frankly, set the gold standard in the domain of cryptocurrency. Being the most known and the most traded of all digital assets, Bitcoin more often than not leads from the front in any crypto bull run. Here are some important reasons why Bitcoin is such a cornerstone of so many cryptocurrency portfolios, particularly during rising markets:
1. Bitcoin’s Proven Track Record
To begin with, Bitcoin has an excellent track record. Since its inception in 2009, it has survived several bull and bear markets. Major Bitcoin price surges have happened over the years, only to finally settle into a higher baseline before shooting up again. It is this consistent recoverability from market corrections and further appreciation that makes it quite attractive to both new and experienced investors alike.
Bitcoin offers a safer entry point for new investors who venture into cryptocurrency.
In general, the crypto market is considered volatile, but compared to altcoins, which are much smaller cryptocurrencies, Bitcoin has been historically less volatile. Being the most liquid and widely traded cryptocurrency, one can easily buy or sell without extreme changes in the market price.
2. A Store of Value Against Economic Uncertainty
Probably one of the major reasons why Bitcoin is getting more popular these days is that it has proven to be a store of value similar to gold. As times get really tough on a global scale, more investors are looking for assets to shield them from such economic difficulties. Bitcoin fits the profile perfectly with its fixed supply of 21 million coins, which creates a scarcity factor, making it an attractive alternative to fiat currencies that can be subject to inflation.
According to Lukman Otunuga, Senior Market Analyst at FXTM:
“Interest in cryptocurrencies definitely went up after Donald Trump’s triumph in the US presidential election of 2024. It remains a question, though, whether the president-elect’s promises will be converted into actual policies that favor increasing interest in cryptocurrencies. Should Trump 2.0 succeed in positioning the US as the ‘crypto capital of the world,’ then that will create a good environment for cryptocurrencies to sustain their recent rise in value.”
This statement only serves to show that mainstream interest in Bitcoin is growing
3. The Success of Bitcoin ETFs and Trusts
For the more conservative investor not interested or even terrified of the maze of cryptocurrency, Bitcoin ETFs and Bitcoin Trusts have made exposure to the price action of Bitcoin somewhat more palatable. The funds let investors bet on Bitcoin futures contracts without actually buying and holding the cryptocurrency.
Furthermore, this avoids any headaches regarding wallet management or dealing with exchanges while offering the regulatory oversight that many conventional investors covet.
These financial instruments allow sophisticated investors or retirees to be exposed to the cryptocurrency market without having to go through the hassle of learning how to safely store Bitcoin in a digital wallet.
Altcoins Are an Opportunity to Diversify
While Bitcoin is still the most dominant cryptocurrency in the market, altcoins are a very attractive alternative for investors who are not afraid to diversify their portfolio and make a high-risk investment for a probable high reward. Ethereum and Solana among a selected few have recently realized such tremendous growth in popularity as investors take a glance at the overall potential of blockchain and DeFi.
1. Ethereum: The indisputable industry leader in DeFi and smart contracts
While considered a more speculative asset than Bitcoin, Ethereum nonetheless stands as the second-biggest cryptocurrency in terms of market capitalization, and the upside potential is huge.
Ethereum’s core strength lies in powering smart contracts and dApps, making Ethereum the backbone of the fast-growing DeFi ecosystem.
Ethereum is scaling into Ethereum 2.0, a process promising much better scalability and reduced gas fees across a much greener chain-in theory, of course, that could finally make it more usable during a bull run. To investors looking to join a more innovative ecosystem with more growth in comparison to Bitcoin, Ethereum always comes out as a natural choice.
2. Solana: The Speed and Scalability King
Other popular altcoins now getting more attention include Solana, which aims at faster and more scalable transactions. For instance, it is known that Solana can process thousands of transactions per second at way cheaper costs than Ethereum’s network.
Rumor has it that Ethereum 2.0 will be far more scalable and quick in transaction speed compared to Solana. Whether this is true or not, this marks an opportunity for investors to get involved in the accelerating pace of blockchain adoption beyond Bitcoin.
How to Invest in Cryptocurrencies During a Bull Run
For both new and experienced investors, having a strategy is key during a bull run. Here’s how different kinds of investors may approach the market:
1. For New Investors: Bitcoin as a Starting Point
To most investors new to cryptocurrency, Bitcoin is probably the first asset that should be in your portfolio. It is relatively stable compared with most other smaller altcoins, and also a good store of value. New investors can also look at Bitcoin ETFs and Trusts as a less complicated way to get exposure to the asset.
A decent strategy for new investors would be to build a solid foundation in Bitcoin while learning about cryptocurrency market dynamics all at once. It is very important for newbies who just started their investor journeys to manage risk by starting with a small sum of money and using dollar-cost averaging as a strategy for reducing price volatility.
2. For the Seasoned Investor: Diversity is Key
More experienced investors can consider other options, but Bitcoin should be the backbone of any cryptocurrency portfolio; adding altcoins could offer the possibility of higher returns in this bull run.
Growth-seeking investors may want to add Ethereum or Solana to their portfolio or any other altcoin. If these altcoins are speculative, one really needs to be updated about market trends and also to be prepared for volatility. The secret for more conservative investors is to balance that risk by putting a large chunk of a portfolio into Bitcoin while using more riskier altcoins for upside potential.
Conclusion
Whether it is worth investing in Bitcoin or altcoins during a bull run depends on one’s financial goals, risk tolerance, and investment strategy. Many investors would argue that Bitcoin presents the sounder, more stable option, having proved itself in the market with high liquidity and immunity against inflation. Altcoins show great potential for better growth, with better diversification possibilities, but they are far more volatile.
Lukman Otunuga believes the current political landscape, coupled with the impending Bitcoin ETFs and the tidal wave of institutional interest, might just see Bitcoin and its altcoin cousins-soar to never-before-seen heights over the coming years.
Whatever you do, make sure it is aligned with your own risk profile and also your version of your long-term financial goals.
