Ask me about Bitcoin/Crypto investing

[watchnerd]

Buying Bitcoin is not an investment. It's speculation, just like currency trading.

 

[tr1ple6]

Buying Bitcoin is not an investment. It's speculation, just like currency trading.

There is a level of speculation with any investment. It is also extremely dissimilar to currency trading. How is Bitcoin not an investment? History has shown it to be an appreciating asset.

 

[Blumlein 88]

... with that kind of money you could have bought our friendship

Yeah. I'll be someone's friend for $100k. Just contact me if you need a friend. That might seem kind of high. But you'll have a hard time finding a friend like me. In fact, I would say I am unique. So $100k per friendship is actually quite the bargain. Just PM me for details.

EDIT to add: Damn Ray, you nailed that explanation of the basics of bitcoin. Bravo!

 

[Sal1950]

Buying Bitcoin is not an investment. It's speculation, just like currency trading.

Yep, kind of sounds like a new version of a ponzi scheme to me.

 

[Sal1950]

Yeah. I'll be someone's friend for $100k. Just contact me if you need a friend. That might seem kind of high. But you'll have a hard time finding a friend like me. In fact, I would say I am unique. So $100k per friendship is actually quite the bargain. Just PM me for details.

EDIT to add: Damn Ray, you nailed that explanation of the basics of bitcoin. Bravo!

I'll befriend you for $25, just send cash.

 

[Blumlein 88]

I'll befriend you for $25, just send cash.

Hey, who wants $25 friends? I mean really, what kind of friends would that be? Stick with quality. Long after the anguish of expense is forgotten, the quality will be remembered for a lifetime.

 

[Sal1950]

Hey, who wants $25 friends? I mean really, what kind of friends would that be? Stick with quality. Long after the anguish of expense is forgotten, the quality will be remembered for a lifetime.

That was just for the handshake level of befriending, higher levels of accommodation require more money, how good a buddy you want to be?
Just ask the Scientologists, it costs biggg bucks to enter their kingdom of heaven.

 

[watchnerd]

There is a level of speculation with any investment. It is also extremely dissimilar to currency trading. How is Bitcoin not an investment? History has shown it to be an appreciating asset.

Well, first of all, there isn't much history.

Second of all, there are no underlying earnings or ability to earn a return on principal.

 

[watchnerd]

Oh, and no legal recourse in the event of fraud or bankruptcy.

 

[watchnerd]

FWIW, I'm not down on blockchain or crypto currencies.

But, as the first big one, Bitcoin will be surpassed by new, better cryptocurrencies that address some of its flaws.

Once that happens, there is no particular reason for Bitcoin to hold its value relative to other cryptocurrencies. There is no real defensive moat.

Also, at the current prices, there is a liquidity trap for the large market makers (e.g. Winkelvoss bros).

 

[tr1ple6]

Well, first of all, there isn't much history.

Second of all, there are no underlying earnings or ability to earn a return on principal.

It's been trading on exchanges for several years now so there is enough of a history to make a judgement on projected future value.

It's not a stock so why would there be underlying earnings? Bitcoin doesn't pay dividends but there are many other crypto currencies and tokens that do.

I'm not trying to convince anyone about the wonders of Bitcoin. Either you get the benefits of crypto or you don't. If you don't like Bitcoin then that is great but comparing it to currency trading has absolutely zero foundation. You're welcome to prove your point though

 

[watchnerd]

It's been trading on exchanges for several years now so there is enough of a history to make a judgement on projected future value.

LOL...no.

The fact that you think 'several years' is significant, when economists still argue about valuation indicators of stocks and bonds which have records going back 100+ years, says enough.

 

[tr1ple6]

FWIW, I'm not down on blockchain or crypto currencies.

But, as the first big one, Bitcoin will be surpassed by new, better cryptocurrencies that address some of its flaws.

Once that happens, there is no particular reason for Bitcoin to hold its value relative to other cryptocurrencies. There is no real defensive moat.

Also, at the current prices, there is a liquidity trap for the large market makers (e.g. Winkelvoss bros).

I think Bitcoin itself isn't that great but the first mover advantage is huge and it will be number 1 for a long while still. There are already many other crypto's that do what Bitcoin does but a lot better. My interest is mainly utility tokens that have a real world application but at the same time I see the benefit of increasing my bitcoin

 

[watchnerd]

I think Bitcoin itself isn't that great but the first mover advantage is huge and it will be number 1 for a long while still. There are already many other crypto's that do what Bitcoin does but a lot better. My interest is mainly utility tokens that have a real world application but at the same time I see the benefit of increasing my bitcoin

Good luck, and I hope you aren't left holding the bag.

 

[tr1ple6]

LOL...no.

The fact that you think 'several years' is significant, when economists still argue about valuation indicators of stocks and bonds which have records going back 100+ years, says enough.

I respect your opinion but I disagree. I am still waiting for a defense of your comparison with currency trading

 

[watchnerd]

I respect your opinion but I disagree. I am still waiting for a defense of your comparison with currency trading

The comparison vs currency trading is that it's just a medium of exchange, like any currency.

It is, after all, a 'currency'.

It has no intrinsic value, it has no linkage to inflation (either as a hedge against or as a hard asset that appreciates with inflation), there are no ownership rights, no legal protection framework, no market price correction mechanisms in terms of shorts, I could go on and on.

It's a fiat currency, backed by faith (like all fiat currencies), but unlike sovereign currencies, it is not backed by taxation powers and powers of confiscation.

That being said, you can't make more of them at will, so you don't have to worry about Zimbabwe scenarios.

 

[watchnerd]

In terms of being able to predict future prices after only a few years of data, here is a famous example of others who thought the same:

 

[tr1ple6]

The comparison vs currency trading is that it's just a medium of exchange, like any currency.

It is, after all, a 'currency'.

It has no intrinsic value, it has no linkage to inflation (either as a hedge against or as a hard asset that appreciates with inflation), there are no ownership rights, no legal protection framework, no market price correction mechanisms in terms of shorts, I could go on and on.

It's a fiat currency, backed by faith (like all fiat currencies), but unlike sovereign currencies, it is not backed by taxation powers and powers of confiscation.

That being said, you can't make more of them at will, so you don't have to worry about Zimbabwe scenarios.

I don't trade and Bitcoin isn't a true currency. Your comparison to currency trading is completely wrong because the value of Bitcoin is unlocked by holding it until your desired profit is reached. More like a stock or gold. If you buy a Bitcoin for 5 dollars and it falls to $1 then you still have that Bitcoin.

The value of a bitcoin is there because each one is energy and cost intensive to mint. It takes over $1000 to create 1 Bitcoin.

The point of crypto is not to be backed by governments. People got tired of getting screwed over by their governments. You are your own bank and you are responsible for the safety of your Bitcoin.

 

[watchnerd]

I don't trade and Bitcoin isn't a true currency. Your comparison to currency trading is completely wrong because the value of Bitcoin is unlocked by holding it until your desired profit is reached. More like a stock or gold. If you buy a Bitcoin for 5 dollars and it falls to $1 then you still have that Bitcoin.

No, the value of Bitcoin is driven by demand. If demand falls, the value falls.

You act as if unlocking a Bitcoin and holding it forever is guaranteed to automatically increase in value no matter what.

No economist would ever agree with that.

 

[tr1ple6]

In terms of being able to predict future prices after only a few years of data, here is a famous example of others who thought the same:

The tulip bulb thing gets bandied about a lot. Ask yourself why Jamie Dimon's bank bought into Bitcoin a few weeks after calling it a tulip bulb.

Anyway, I would prefer if we kept such discussions in the other thread. This thread was meant to help answer questions about crypto investing and not discuss the merit thereof.