- Solana (SOL-USD) is a legitimate contender.
- New and innovative spin with proof of history.
- Accumulate with confidence over time.
This is an update on my Solana (SOL-USD) journey within my crypto investment thesis. I will also re-set the stage for those unfamiliar with the basics. But first we must address the macroeconomic conditions facing investors of all assets. The equity markets have been on edge for a while and for good reason. The geopolitical unrest is cause for serious concern. The situation in Ukraine is volatile, and it could spill out of the region quickly.
There is also a macroeconomic war raging on the monetary policy front. Central banks, mainly the U.S. Fed is now a clear enemy of Wall Street. They are focusing solely on price stability for the rest of the year. Political pressures placed inflation as the crisis on their hot plate. Therefore, it is not a surprise to see equities struggle to maintain positive trends for long. Just yesterday the indices flipped from bright green to crimson red within hours.
Short Term Opportunities Abound
The cryptocurrency sector is also trending in lockstep with stocks for now. Bitcoin (BTC-USD) lost a the technical advantage in the charts in January. The correction for Bitcoin currently stands at 15%, but Solana fell 43%. Newer and hotter coins tend to move faster than the chief coin in charge. However, the long-term prognosis for SOL-USD and its cohort is good. This makes big dips opportunities to accumulate SOL on weakness.
The investment strategy to use is one that is decades old. Experts have long taught the idea of accumulating assets over time, one bit at a time. This alleviates the need to be surgically accurate with one giant entry at a perfect price. Investing in crypto takes courage, because of the often mentioned narrative that it’s fake. Too many people take it too lightly, but in the end the joke will be on them. At some point, they will have to play catch up with the knowledge base.
Meanwhile early birds like us have had the foresight to amass small fortunes. Transacting in crypto coins will happen in the future. Solana is helping build the platforms that will process them. Until now, I’ve treated my crypto transactions as trades more so than long-term investments. Luckily they each delivered at least 30% wins over several stints. I am shifting course for the remainder of the year.
Accumulate Solana Over Time
My most recent approach is to build a core position for the long term. The first step was to build a position in SOL-USD and Ethereum (ETH-USD) in several batches. I started this when Bitcoin fell into its January lows. My next addition will not happen until and unless Bitcoin falls another 25% below that. I will continue to use BTC-USD as my marker to signal all my crypto decisions.
My last purchase of Solana was at $79. On April 2nd it had risen to $143. But I resisted the urge to book my 80%, and I stuck to my plan. In fact as soon as I purchased them, I immediately locked them through staking. This is a process that rewards me 3% for holding on to my coins for three months. The reason I chose SOL is for the purpose it serves. Currently Ethereum is the dominant processing platform. Solana is a budding competitor that is thousands of times faster and more efficient. Logically it stands to succeed well, so I will hold it with confidence.
The world hasn’t always transacted with cash. There is evidence of minted tender as early as 600 B.C. In the U.S. the first paper money did not come until 1690. There were several iterations of those throughout history. My point is that change does happen and money is not the exception. The world is continually evolving, especially after the pandemic.
The natural next step for cash is to become electronic. Cryptocurrency is showing us what the future will be like for finance. From an investment perspective, a high number of skeptics is a positive thing. Those are likely going to be the incremental buyers in the future. Accumulating the currencies of the future now makes sense.
On the date of publication, Nicholas Chahine held a long position in SOL-USD and ETH-USD stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.