My friends, I swapped all of my Solana yesterday for Internet Computer Protocol. My portfolio is now two thirds Bitcoin, one third Internet Computer Protocol. I want to walk you through exactly why I did that and why I'm running this strategy now, because this is the best way I see to structure my crypto portfolio for both simplicity and long term wealth building, with the lowest risk versus the highest reward multiple.
I've got mostly Bitcoin because I see the risk of it going down and losing as pretty low, and there are still lots of returns to be made. Internet Computer Protocol is a much higher risk, but I think this one has a chance, in time, of doing as much as 1,000x, perhaps in the cycle after this one. I've done lots of videos talking about how hyped up I've been about Solana, and I'll compare the two a bit here. But long story short, it doesn't make sense for me to hold Solana when Internet Computer Protocol looks like a far more attractive investment to me.
Why Internet Computer Over Solana
In the short term, Internet Computer Protocol is definitely more risky. It could lose more than Solana, although Internet Computer is sitting at its all time low while Solana is already up 2x from its all time low. In the long term, though, Internet Computer Protocol does something that no other crypto does. Solana, ultimately, is kind of just a copy. It's like a faster version of Ethereum. And while there's a lot to like about Solana, there's more to like about Internet Computer.
If you compare the market caps, that's a big part of my reasoning as well. I would not have made this swap if they had the same market cap. Looking at Solana, it has a market cap of about $8 billion. Internet Computer has a market cap of about $1.5 billion. To me, Solana and Internet Computer deserve an equal valuation based on the technology they have, what they're offering, and what's happening in both ecosystems. In my view, Internet Computer is massively undervalued, and Solana is probably significantly undervalued too. Just to get to where Solana is at, Internet Computer would need to do a 5x. So if I'm looking for the biggest gains in my portfolio, Internet Computer offers a lot more attractive gain potential. I believe the potential for Internet Computer is to reach a trillion dollar market cap, which means it's possible that from where it's at today we could be looking at close to 1,000x if it actually gets adopted significantly. That adoption is the biggest risk, that it won't get adopted.
In my previous videos, I've gone over some of the worst parts about Internet Computer Protocol, so to be clear, I've researched this very thoroughly. I've put hundreds of hours into researching Internet Computer Protocol. I've pointed out how I was wrong with my big altcoin pick in 2018. I've discussed why Internet Computer is down so much. I've discussed one of the biggest short term risks for the price. So to be very clear, I've looked at the negative parts, at what's not to like about Internet Computer, in detail. And after having looked at all those negative parts, I find it much more attractive for the risk portion of my portfolio than Solana.
In the short term, I think Solana is going to have a great bull market. I think it'll far outperform Ethereum. That said, I think I can get better multiples in Internet Computer, and that's why I don't want to hold Solana when I could have that money in Internet Computer. I'm also seeing that Internet Computer videos are doing fantastic on my channel, which to me is one indication of a community that appreciates my contributions. And I see more opportunities to make videos about Internet Computer Protocol than almost anything else. So I'm testing dedicating my channel to Internet Computer, because there are enough Bitcoin channels out there. Do we really need one more Bitcoin channel? One of Internet Computer's biggest weaknesses right now is its marketing, and that's something I can help out with.
Transactions, Adoption, And What Makes It Different
When we look at Internet Computer and Solana in terms of transactions and network usage, this is where Internet Computer comes out very far ahead to me. If you compare Solana to everything besides Internet Computer, it looks great. There are a lot of transactions, thousands per second, even more than Internet Computer at the moment. If you exclude the vote transactions, there are about 230 transactions a second with Solana. It has some of the highest NFT trading volume outside of Ethereum, which is incredible. There are a lot of reasons to be positive about Solana.
Where I'm concerned with Solana is the long term. It could have an equal bull market with Internet Computer, because it could pump really hard and so could Internet Computer. But in the long term, to me there's much more of a risk that Solana does not sustain adoption. Why? Because there are so many things similar to Solana out there, and there's nothing similar to Internet Computer. This is the only option if you want to do everything on chain with your crypto app, where you can have your website, and all the transactions, and all the NFTs, and all the data, and everything on chain. There is no other option besides Internet Computer.
If you watch one of InvestAnswer's recent videos, he talks about the difference between investing in the very best technology and the very best performers versus investing in things that were more average. He talks about how returns are made by investing in the very best. For example, if you bought Apple way back in the day, then your returns on that versus buying most of the other stocks are way, way different. If you invested in something like Amazon versus almost anything else, you just come out so much further ahead. And after looking through hundreds and hundreds of altcoins, there's nothing else like Internet Computer on the market, because this is your only option if you actually care about doing things on chain. This is also the only crypto out there that is capable of being, and is currently, a Bitcoin Layer 2. An Ethereum Layer 2 will be launching soon, and this could be a Layer 2 for all kinds of different chains. There's nothing like this. And there's a bunch of stuff like Solana. You've got tons of things similar to Solana that are fast and mass adoption friendly, and I don't want to invest in something where there's heavy competition.
Now, yes, there's always going to be competition, and yes, there's a risk that Internet Computer does not get adopted, that people don't care about putting things on chain. And to be sure, the volume for Solana is very strong compared to Internet Computer. The volume right now for Solana is currently 10 times as high, while the market cap for Solana is only about 5 times as high. So yes, Solana is a lot more relevant, and Solana has nice staking rewards as well, which I like. But I want to have all my money in the very best opportunities I see, and I want everything balanced for risk. I want asymmetric risk. To me, the odds of Solana doing 1,000x are much smaller than Internet Computer, because it has so much competition.
The Two Directions Crypto Can Go
I see two basic directions where crypto is going for building. One is that everything is all about these Ethereum Layer 2s, and then Ethereum is going to be utterly dominant in crypto. However, even in that scenario, Internet Computer has the potential for a lot of Ethereum Layer 2 things to be built on it. In the other scenario, we go much more towards Layer 1, where you could use something like Solana. But in that scenario, Internet Computer has got a very good shot to be the dominant Layer 1 as well, because you can't do what you can do on Internet Computer anywhere else. I'm looking for a black hole that just sucks everything else into it, where the more it gets adopted, the more it brings in more and more traffic.
What I see with the Ethereum ecosystem is that the apps building on these Ethereum Layer 2s suck. The games are terrible in terms of the gas fees and not being able to do anything on chain. These apps like friend.tech and post.tech are just garbage. Almost all of them are just short term money grabs that are never going to last, and the reason is that these apps aren't built on chain. They don't have any real value or ownership for the users. Unfortunately, Solana falls into that same trap. It's just a chain where you have to use all these other centralized services, like Amazon Web Services and these wallets, to even do anything with it. And that is not where I want my money, because there's too much uncertainty with user adoption. Near has just spiked up recently in transactions, and these chains can suddenly gain a bunch of users and lose a bunch of users very easily.
What I'm seeing is that the best opportunity I see in crypto is Internet Computer, and the least risky opportunity in crypto is Bitcoin. So between those two, I really don't want to have any meaningful amount of money anywhere else. To me, diversification indicates that I don't really know what I'm investing in that well, so I just throw my money around. But with crypto, you get penalized heavily for investing that way, because almost every crypto is a loser in the long run. And I'm willing to be wrong on this. You could look at it and say it'd be safer to keep some in Solana and some in Internet Computer. I've got so much Bitcoin in my portfolio that with the other two thirds of it, I'm willing to take more risk. In the long term, I think Solana is just as risky as Internet Computer in terms of adoption, people continuing to use it, and price action. Internet Computer's price is so far down compared to the value of the network that I see the risk as about the same, and I see that the gains possible in Internet Computer are at least five times what they are in Solana. So to me, it's very logical to go all in on Internet Computer as the one altcoin I'm significantly invested in, and then Bitcoin for the rest.
I even thought about selling my Bitcoin for Internet Computer. But if I look over the last nine years in crypto, if I could isolate one single regret, it's selling my Bitcoin, and especially selling all of it for an altcoin. I had 60 Bitcoin I was sitting on in 2017, and I poured almost all of it into Steem, and as I've shared recently, I got wrecked on that. So I figure as long as I'm holding my Bitcoin, I'm getting almost guaranteed gains, and with the rest of my portfolio we'll take a shot at higher gains.
Where I'm Putting My Energy
I know some of you copy me and do what I do, and I also want to teach the very simplest strategy. What I teach is by example, so my two thirds Bitcoin, one third Internet Computer split is my teaching. The more of you have asked me to explain altcoins and research, the more I've grown to love Internet Computer more than anything else. So I want to put my money where I feel the energy is. To me, the energy is in Bitcoin and Internet Computer. It's also in Ethereum, but I'm not feeling the vibe with Ethereum. I think there are a lot of risks in Ethereum, and I'd rather have Bitcoin than Ethereum at this point. We'll all see how this works out. If you're still following in 10 or 20 years, we can all compare notes. If you want to go deeper on this coin with me, you can watch through my ICP Crypto playlist and see the full case laid out over time.
If you really want me to hear what you have to say, and if you want to talk through these positions together, the best way to do that today is to join the Jerry Banfield Family. It's where I share my thinking, where I've talked through selling all my other altcoins for Internet Computer and holding a heavy Bitcoin position, and where I get some of the most valuable feedback I've ever received.
Some of the people in that community have been very critical of this decision, and I love that. I love to hear critical feedback, I love to have my positions challenged, and I encourage you to have your positions challenged as well, because sometimes you'll discover weaknesses, and that's useful. I appreciate you being here.