**Why We Hold Bitcoin (But Rarely Talk About It)**

We own bitcoin, but we don’t talk about it much. That’s because the world of crypto has long felt like a risky casino. It’s full of hype, scams, and confusing promises. But things are starting to change. Big institutions and regulators are finally warming up to crypto—and when that happens, we start to pay attention.

**Is Crypto Really an “Asset Class”?**

When investors talk about asset classes—like stocks, bonds, or real estate—they usually have solid ways to figure out value. With crypto, most of it feels like guesswork. There’s no earnings report, no cash flow, no dividends—just a lot of people saying “you just don’t get it” and “this time it’s different.” But those are dangerous words in investing.

Professional investors look at entire asset classes first. They ask: is this something we can even invest in seriously? Most retail (everyday) investors don’t do well. In fact, in 2023, average equity investors underperformed the S&P 500 by 5.5%. Even in good years, they lose money. Now imagine diving into a market where half the tokens have already gone bust. That’s crypto for you.

**Crypto is Changing: Institutions Are Interested**

Now the tide is shifting. Big institutions are showing interest in digital assets. That’s a good sign. Institutional money brings structure, regulation, and credibility. As this happens, more investors are asking:

– What crypto should I buy?
– How should I hold it?
– How much should I invest?

Let’s break it down.

**What Crypto Should You Own?**

First, look at the size of the crypto market. Right now, it’s around $4 trillion in value. Bitcoin alone makes up about 58% of that—roughly $2.4 trillion. The top five cryptocurrencies account for over 80% of total value.

But not all top tokens are trustworthy. For example, Tether (USDT) claims to be backed by U.S. dollars but hasn’t been properly audited. That’s a red flag. Until they show real transparency, we’re staying away.

Some funds agree with us. The Grayscale Digital Large Cap Fund (GDLC), one of the few crypto ETFs approved right now, avoids Tether entirely. It holds bitcoin and ethereum instead.

If you’re thinking of copying that ETF with your own portfolio, remember the fund charges a 2.5% fee each year—something you might avoid by buying the coins yourself and rebalancing every few months.

**Where Should You Keep Your Crypto?**

The safest way to invest in crypto is through ETFs offered by well-known financial firms. These companies are regulated and often publicly traded—so they’re audited and accountable.

If you decide to buy and store crypto yourself, choose a trusted exchange like Coinbase (COIN). Coinbase is publicly traded, works with institutions, and keeps 98% of assets in cold storage (offline). That’s about as safe as it gets.

Still, be careful: don’t share where you store your crypto or how much you have. Use strong security like two-factor authentication (2FA), never click on suspicious links, and don’t fall for scams.

If cold storage sounds too complicated, you don’t have to use it. Just secure your account properly and avoid getting too fancy.

**How Much Crypto Should You Own?**

This depends on your overall investment plan. A simple rule is to limit alternative assets—like crypto—to no more than 10% of your total portfolio. That’s what we do.

Our alternative assets include gold, wine, art, and bitcoin—each with about a 25% slice of that 10%. It keeps things balanced and interesting.

Choose alternatives that match your interests and goals. Love wine or art? Those can be fun investments too. Gold offers good diversification. If you’re really into crypto, maybe your whole 10% can go there—but set limits.

**When to Buy More Crypto? Not Now**

We’re not increasing our crypto exposure just because prices are high or headlines are buzzing. The best time to buy is usually when everyone else is calling crypto dead.

A key benefit of alternative assets is that they often don’t move the same way as stocks or bonds. But crypto hasn’t been around long enough to say that for sure. We need more data before making big changes.

**Investing in Crypto Stocks**

Some people ask about getting crypto exposure through stocks—like MicroStrategy (MSTR), which holds a lot of bitcoin but comes with risks. There are also new names popping up—like Circle’s IPO or various bitcoin miners—but many shift focus depending on market trends.

We prefer Coinbase as a way to play the rise of institutional interest in crypto. It’s a solid pick-and-shovel play on digital assets.

**Final Thoughts**

Crypto inspires strong opinions—some love it, others hate it. But smart investing isn’t emotional. Institutions are starting to take crypto seriously, and that gives us reason to watch closely.

For now, we’re keeping our crypto exposure small but meaningful within our alternative assets bucket. If the industry keeps maturing—more regulation, more institutional adoption—we’ll consider expanding our strategy.

No need to rush or chase hype. Think long-term, think in terms of asset classes, and always invest with care and caution.