LyCI - The Smart HODL
In January 2019, Lykke launched the LyCI Service token, empowering customers to purchase the top 25 cryptocurrencies tracked by the LyCI Index in just one click. The LyCI Index was introduced by Lykke at the end of 2018 and represents a market-cap weighted basket of the top-25 crypto assets, rebalanced minute-by-minute.
A number of different factors could have a big influence in the market in only a 6 or 12 month period. This includes attacks on lesser and smaller blockchains but also unexpected forks or new groundbreaking projects. No matter how successful an investor is at picking the projects with most potential, he/she will most likely miss at least a couple of crypto gems.
LyCI not only takes care of the inconvenience of handling multiple different wallets — and all the liabilities that come with it — but works 24/7 all year long without any action or hassle needed from the investor side.
Let’s travel back in time to February 2014, exactly five years ago.
At first glance, it’s easy to spot Bitcoin’s dominance at number 1, and XRP (Ripple back then) at number 3. Only Litecoin, Dash and Dogecoin remain in the top 25. The rest is composed of projects that either failed to capture the necessary network effects, projects that are highly illiquid and/or projects that just plain disappeared over time. Digging deeper, it’s easy to see how easy it could’ve been to entirely miss the rise of Ethereum (or XRP) to the second spot, either due to lack of information, skepticism or just plain prejudice and misconceptions against the project. On the other hand, just holding Bitcoin, while certainly a valid strategy, has an obvious risk of “putting all eggs in one basket”,something that is increasingly obvious with the recent slide of Bitcoin.
What we want to show here is far from just a simple exercise on nostalgia. It’s a clear example of how much can change in an emergent market like crypto in only five years. Passively investing in an index like LyCI could be the perfect way to gain exposure, diversify and simplify the process of managing a crypto-portfolio.
