This research is not intended to serve as investment advice. Any party relying on this document to make an investment should take full responsibility for their own decision. We are not liable for any losses incurred. Author holds HeroCoin in his portfolio.
When building a crypto asset portfolio, most experienced investors choose bitcoin and ether as their primary holdings and then add several of the leading altcoins as the secondary holdings. Additionally, a small percentage of their portfolio is usually attributed to promising “small cap” cryptocurrencies that have the potential to multiply in value. However, due to their illiquidity and the fact that many of these smaller coins are from recently launched blockchain projects, they carry a much higher risk than established cryptocurrencies. Hence, they only make up a small percentage of a well-diversified digital asset portfolio.
In this article, you will discover five “small cap” cryptocurrencies with market capitalizations of less than USD 100 million that you might consider looking into as they have the potential to multiply in value in the coming years.
The BCAP (BCAP) token was issued by leading bitcoin-focused venture capital firm Blockchain Capital to raise capital for a new fund that invests in blockchain startups. The token was issued at a price of USD 1 dollar per BCAP token in a highly successful token sale in April 2017, which closed within six hours after it hit its funding target of USD 10 million.
The BCAP token enables investors to indirectly benefit from the success of one of Blockchain Capital’s new venture capital funds and to gain exposure to venture capital as an asset class, which is normally only reserved for high net worth individuals.
At the time of writing, the BCAP token was trading at around USD 2.68 and had a market capitalization of around USD 27 million.
The BlockCAT (CAT) token is the digital token that was issued by the German startup BlockCAT during its successful initial coin offering (ICO) in August 2017, where the project managed to raise over USD 6 million. BlockCAT is developing a platform that allows anyone to create, manage and deploy Ethereum smart contracts using a visual designer without the need of any programming knowledge or experience.
If BlockCAT manages to establish itself as one of the go-to platforms for Ethereum smart contracts creation by small and medium-sized businesses, its digital token could multiply in value from its current price level. Given that BlockCAT is currently the only company offering this type of “no programming skills required” smart contract creation service, they are well-positioned to achieve this status.
At the time of writing, BlockCAT was trading at USD 1.69 and had a market capitalization of USD 12.4 million. BlockCAT’s issue price was USD 0.88, which shows that the market is already pricing in BlockCAT’s potential success.
Change (CAG) is a digital token that was launched by Change Bank, a blockchain startup that aims to become “the first truly decentralized crypto bank” in the world. More specifically, the team behind Change Bank wants to combine all financial services into one easy-to-use blockchain-based platform for payments, money transfers, and investments.
During its token sale, Change Bank managed to raise over USD 16 million for the development of its platform and has since entered into several partnerships to turn their idea into a reality. Despite ample competition in the “blockchain bank” space, Change Bank is well-positioned to become one of the go-to crypto banks of the future. If the Change Bank team manages to achieve that, then its token has the potential to become a highly profitable investment.
At the time of writing, Change was trading at USD 0.27 and had a market capitalization of around USD 10 million. Change’s issue price was USD 0.67.
HeroCoin (PLAY) is the digital token of the esports betting venture HeroSphere. HeroSphere is an existing esports betting platform with a substantial user base that enables esports fans to wager on the outcome of esports tournaments. With the launch of the HeroCoin token through their token sale in October 2017, the Austrian startup aims to decentralize the heavily centralized world of esports betting through the use of blockchain technology and its digital token.
If HeroSphere delivers on its mission and manages to establish itself as a global go-to esports betting platform, then its digital token has the potential to be worth a multitude of what it is worth today.
At the time of writing, HeroCoin was trading at USD 0.063 and has a market capitalization of USD 7 million. HeroCoin’s issue price was USD 0.0267.
The TaaS (TAAS) token provides investors with a share in “the first tokenized close-ended fund dedicated to blockchain assets”. In other words, by purchasing TaaS, investors are indirectly buying a diversified basket of digital assets, which provides them with broad exposure to the cryptocurrency market. Furthermore, investors also receive a share of the fund’s profits paid out as a quarterly dividend payment in ether (ETH).
The TaaS token was issued during the company’s successful ICO in March 2017 where the startup managed to raise almost USD 8 million to develop its investment platform. Since the launch of TaaS, the token has rallied by over 500% to currently trade at USD 5.14 with a market capitalization of around USD 42 million. TaaS was issued at a price of USD 1 per token.
Investing in Small Cap Coins
You should only attribute a small percentage of your overall crypto asset portfolio to “small cap” tokens as they are much riskier investments than established coins with a successful track record such as bitcoin, ether, dash, and litecoin. That means that the value of these “small cap” coins can also amount to next to nothing should the teams behind these projects not deliver on their missions.
As with all cryptocurrency investments, you should never invest more than you can afford to lose. That is, even more, the case when it comes to illiquid smaller cryptocurrencies as the risk/return payoff is very high for these type of investments.