Crypto Briefing’s CB10 experimental index was able to cushion the recent downtrend in ETH. This protection was thanks to diversification and disciplined investment in the top ten cryptocurrencies weighted by market capitalization on CoinGecko for U.S. investors.
Crypto Briefing CB10 Index Performance
The CB10 crypto index returned 44.4% in February.
A hypothetical $1,000 invested on Jan. 5 grew to $1,080 (yielding 8%) by month’S end and has risen by another $491 in February.
The cumulative return in CB10 since formation at the beginning of the year is 57.7%. In comparison, BTC has risen by 59.5% and ETH 27.5% year-to-date. The index’s performance closely tracked the alpha cryptocurrency’s price action.
The rising gas fees on Ethereum showed cracks in ETH price as the market’s liquidity flew to alternative projects. Numerous DeFi projects in 1inch, Compound, The Graph, and others expanded their reach beyond Ethereum.
Ethereum’s competition in Binance Smart Chain and Cardano grabbed the market’s main attention as BNB and ADA gained 360% and 175% since Feb. 1.
In February, across crypto markets, another notable trend was the shift back to native Layer 1 tokens compared to DeFi governance tokens.
Rebalancing CB10 for March
The reconstitution of the CB10 portfolio was successful at 10: 20 am EST on Mar. 4. The updated distribution of hypothetical $1,000 can be found here.
Ethereum was the biggest loser in this month’s rebalancing at negative 3.43%, thanks to the rising popularity of Ethereum’s competition. BTC and ADA were this month’s biggest winners with a 0.96% and 1.67% increase in allocation.
While BNB’s extraordinary rise has brought mainstream DeFi discussion around it, still, it did not make it to Crypto Briefing’s index as the portfolio is U.S. based, and neither Kraken, Gemini, nor Coinbase Pro lists BNB.
Instead, Dogecoin entered the index during the reconstitution with 0.52% allocation, replacing AAVE at 0.44%. DOGE was eliminated last month due to extreme volatility in the token. However, DOGE holders have shown tremendous resilience in the last couple of weeks.
DOGE replaced AAVE; currently, the only DeFi governance token in the top ten crypto index is UNI.
The methodology for the rebalance was shared in last month’s update. Investors can opt for profit booking for the current month or reinvest proceeds yet again.
Disclosure: The author held Bitcoin at the time of press.