Diversification is when you don't put all your eggs in one basket, but spread your money across different assets to reduce risks.
A simple example:
Imagine you decided to invest all your money in one cryptocurrency, for example, Bitcoin (BTC). If BTC suddenly drops, you will lose a lot.
But if you divide your investments between BTC, ETH, BNB, SOL, and XRP, even if one asset falls, others may rise and compensate for the losses.
I have gathered for you (in my opinion) the safest wallet of 5 assets with a distribution based on risk and growth potential
40% – Bitcoin ($BTC ) → Primary asset, protective reserve, "digital gold"
25% – Ethereum ($ETH ) → Leader among blockchains for smart contracts
15% – BNB ($BNB ) → Top exchange coin with high liquidity
10% – Solana (SOL) → Fast and promising blockchain
10% – XRP → Popular coin for bank transfers, expected legalization