Industry Analysis

What we can learn from the investment strategy of Vitalik

On February18th 2019, the cryptocurrency community got to know Vitalik’s cryptocurrency holdings during an “Ask me anything” AMA thread on Reddit. In this section, we will breakdown the investment strategy of Vitalik based on the information he provided.

During the session, many were surprised to know the millions in investment he has invested in non-Ethereum related projects but also in equity-based companies.

As many may expect, the majority of his investment is in Ethereum where he disclosed owning 350,000 ETH worth about $50 million. Below, we will explore what we investors can learn based on his investment style.

Investment strategy of Vitalik

Diversification of Investments

Though Vitalik doesn’t hold a significant amount of coins outside Ethereum, his investment in other projects makes it clear that he believes very strongly in the diversification of his portfolio.

Many investors within the crypto space get soo emotionally attached to a specific coin and never think of diversifying their portfolio. During the session, he mentioned that he currently holds coins both within and outside the Ethereum ecosystem. Some of the coins he holds are;

Bitcoin (BTC), Bitcoin Cash(BCH), Dogecoin(DOGE) and Zcash(ZEC). These combined is said to be less than 10% of his Ethereum holding.

ICO investments

From the disclosure, Vitalik also holds some ERC20 tokens. These are tokens which were built on the Ethereum Network and most often they use the coins to raise millions via ICOs (initial coin offerings).

Many despise ICOs given the alarming rate of scams associated with ICOs. However, doing in-depth own research of an ICO project might prove to be a wise investment.

Here is a list of ERC20 tokens which Vitalik hold;

Kyber Network (KNC), Maker (MKR), OmiseGO (OMG), and Augur(REP), collectively worth less than 10% of his entire holdings

Equity investments

Though many within the crypto space focus on investing in non-equity related projects, Vitalik seems to have his money invested in equity-based projects where he gets dividends as a shareholder.

In the disclosure, Vitalik mentioned he has also invested significantly in two corporate shareholding companies; Clearmatics and Starware.

Both companies are said to be blockchain based with former being a research and development company and the later, a software company attempting to solvce scalability and privacy issues.


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