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'Wolf of All Streets' crypto trader Scott Melker breaks down his strategy for making money using 'HODLing' and 100-times trade opportunities — and shares 5 under-the-radar tokens he thinks could explode

Scott Melker, aka 'The Wolf of All Streets', a crypto trader and investorThe Wolf of All Streets

Summary List Placement

Scott Melker is one of the best-known names in the world of crypto trading. His alter-ego, "The Wolf of All Streets", is aptly named because of his versatility within the space.

Melker is, on one hand, a crypto thought-leader and influencer that drives deep discussions on his podcast with leading names in the crypto and finance sectors, such as Jim O'Shaugnessy and Michael Saylor, and on the other, he's known for sharing his quick daily crypto insights to his almost-400,000 Twitter followers.

He's also a high-profile crypto investor and trader who is known for providing his expertise on the market to the masses via his daily newsletter. 

This is all following an already successful 20-year career in music as a DJ performing alongside the likes of Steve Aoki and Kanye West.

A crypto investor who trades

"I should be very, very clear that even in the height of my trading, I view myself as an investor first and always have," Melker told Insider in an interview. "Anyone who asks me, I say I'm an investor who trades."

Melker takes a balanced approach to investing compared to most well-known crypto bulls by also still playing in traditional markets.

"I believe that people should have at least 60% to 70% of their assets in long term investments and 15% in cash and 15% for trading because, as we know, traders tend to underperform the market," Melker said.

Crypto is one part of a wider diversified portfolio ranging from real estate to stock investments.

"In fact, until late 2019, I told people that I wasn't comfortable with having more than 10% of my net worth in crypto," Melker said.

That's now changed. Melker now allows his crypto assets to grow and make up a far greater percentage of his portfolio.

Crypto asset allocation

For Melker's crypto allocation, he maintains a similar investment mentality. He keeps 70% in long-term investments, primarily bitcoin and ether, Ethereum's native currency. 

The rest of his long-term strategy focuses around trades that have done exceptionally well.

"In crypto, you can do 10/20/100 times your money on a trade and, well, the last 20% of that position I'll move over into the investing portfolio and just let it grow for years, or let it go to zero, because I've already made my money," Melker said.

Melker also mimics the 15% allocation to cash found in traditional portfolios in his crypto holdings, because of the creation of stable coins.

Stable coins are cryptocurrencies that peg their value to an outside asset, such as the US dollar or gold, to stabilize the price. Currently they can be held on various platforms, such as Voyager and BlockFi, earning up to 10% yield yearly.

"I find it absolutely incredible," Melker said. "To me, it's actually the largest innovation probably in the crypto space in the last year to two years."

Then, the final 15% goes to trading and being more active in the market, Melker said.

HODLing or investing?

However, Melker believes investing is the key to success in crypto rather than trading.

"Frankly, I think that the people who have done best in crypto are the ones who have strong hands and buy things and just wait," Melker said.

Investors who can get in early and hold amid volatility will reap the rewards, he said. 

Some in the crypto world refer to this as 'HODLing', slang for investors who buy and hold their positions, regardless of what happens to the price.

"Like any market, you buy when there's fear and you sell when there's greed," Melker said.  "And if you were buying for the last three years, like a lot of us were when the market was terrible, well you're seeing the fruits of those labors and you don't need to do much trading."

Investors' concentration should be on two core assets, bitcoin and ether, Melker said, even for those new to crypto trading and investing.

The strategy of 80% bitcoin and 20% ether is reasonable, Melker said. However, he said he would increase the allocation to ether slightly.

At the time of interview on May 5, Melker had a target for ether of $3,600 for the first months of the year; the target was met 3 days later.

"I think ether's going easily to $10,000 in this cycle, and I think ether could go much higher to be quite honest," Melker said. "And I think that bitcoin [will go to] $200,000, $230,000, $235,000."

Fundamentally, everything is in place for much larger moves for both assets, Melker said.

Managing 100x opportunities

Although investing is Melker's largest allocation, he believes there are still opportunities for crypto traders to pocket handsome gains, even as the markets become more efficient and a lot of the volatility that is so attractive subsides. 

"I would say that if you're extremely knowledgeable, and you're a decent picker of those smaller cap coins, you can literally do 100 times your money on one of those in a week," Melker said. "Taking a few of those opportunities with a smaller amount of your capital becomes very meaningful."

Melker also holds a few under-the-radar tokens in relatively small positions. He shares five coins that he's holding right now that he believes hold great potential as long-term investments, rather than short-term trades. 

  1. LINK - Link, the native token to the Chainlink network. YTD: +300%. 
  2. DOT - Dot, the native token to the Polkadot network. YTD: +345%
  3. EGLD - EGold, native to the Elrond network. YTD: +590%
  4. UTK - Melker has an investment in the company UTrusts and this is their token. YTD: +414%
  5. POLS - Melker said this is a trade that did exceptionally well and is one he moved to his investing strategy.

Melker was a one-time owner of dogecoin, the meme cryptocurrency that has risen by more than 20,000% in a year thanks to endorsements from celebrities and entrepreneurs, such as Tesla boss Elon Musk. He held it for some time, before cashing out some time ago, while the token was still worth less than $0.01, compared to the $0.53 it trades at now.

"Honestly, do you want to talk about that, because it hurts?" Melker joked. 

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