How to Allocate a Crypto Portfolio: A Basic Position-Sizing Framework

Core-satellite allocation, position-cap principles, and reference frameworks for different risk appetites

2026-05-22

"How much should I buy?" "Should I go all-in on one coin?" — position sizing determines survival more than coin selection. Here is a basic framework.

First principle: only invest what you can afford to lose entirely Crypto is a high-volatility asset; before allocating, ensure losing it all won't affect your life. This is the precondition for everything.

Core-satellite allocation

Core (60%–80%): BTC, ETH — the largest-cap, most likely to survive long-term. Your ballast.
Satellite (20%–40%): mid/small-cap coins you favor, for higher upside, but cap each one.

Per-coin position cap No single altcoin exceeds 5%–10% of total. That way, even if one goes to zero, it won't blow up your portfolio. The smaller the cap, the lower the limit.

Three risk-appetite references (a thinking framework only)

Conservative: BTC 70% / ETH 20% / stablecoins 10%, barely touching alts.
Balanced: BTC 50% / ETH 25% / major alts 15% / stablecoins 10%.
Aggressive: BTC 35% / ETH 25% / alts 30% / stablecoins 10%, accepting larger swings.

Don't forget cash (stablecoins) Keeping some stablecoins is both ammo for dips and a psychological buffer, avoiding panic when fully invested and trapped.

Rebalance periodically Price moves drift your allocation off target. Rebalancing back to target every so often (e.g. quarterly) is essentially disciplined "sell high, buy low."

For reference only. Not financial advice.