How to Build a Diversified Crypto Allocation

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As the blockchain ecosystem develops and new cryptocurrencies spawn, investors are attempting to diversify their holdings to effectively capture the crypto market. After investors determine how much of their portfolios they want to dedicate to cryptocurrencies, a question soon follows: Which cryptocurrencies should constitute those holdings?

Several avenues for diversifying cryptocurrency portfolios exist. Investors should weigh the costs and benefits of each of the following three methods for purchasing and holding crypto assets: assembling a diversified portfolio by buying cryptocurrencies individually through an exchange, purchasing a crypto trust or ETF, or enrolling in an automatically managed crypto robo-advisor.