Author Topic: What do you think of adding a low% of crypto allocation  (Read 32820 times)

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #400 on: October 29, 2021, 01:27:02 PM »
Can anyone give a simple "ELI5" example of the source of interest payments from staking?

Sure thing. It comes from two sources:

1) The block reward. These are new units of currency which are created by the built in rules of the currency and controlled by whoever produced that particular block (in bitcoin the amount of new currency declines over time towards and ultimately reaching zero). This is the same way the fed creates new units of dollars when it buys governments bonds or other securities.

2) Transaction fees. These are existing units of currency that people who want to transfer currency from one wallet to another pay to have their transactions processed. In principle transaction fees can be zero, but if there are more transactions that people want to make queued up than room to make them in a current block, the transactions with the highest fees cut to the front of the line. This is like the percentage of each transaction that goes to mastercard/visa/paypal when you make a payment using one of those avanue to move dollars around.

Cool. I appreciate the straightforwardness :)

For item 1, do you see any trouble with that? Is there value in this block reward that's summoned from nothing? Where's the value come from?

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #401 on: October 29, 2021, 01:28:55 PM »
@aceyou , I appreciate your candor and specifics.

I don't have access to key details, like Aceyou's retirement horizon, or ability to generate income today, but that is a massive allocation to Bitcoin and Ether, far in excess of the "low%" that is advertised in the title of this thread. If you're a new reader considering crypto, please consider carefully whether making crypto 40% of a seven digit net worth will work within your risk tolerance. Emotionally, I'd find it difficult to experience 10% of my NW evaporating in twelve hours several times a year.

Yeah, I do consider it to be a massive allocation, I did not start thread, just a contributor to the discussion.  A few details of why I am comfortable doing it:

Age: 38 (DW is 37)
NW: 1.1 Million
Stache: 800k
Other: Pension that kicks in in 10 years.  Between my wife and myself, that will be about 100k total per year, starting in 2031. 

Worst case scenario: I lose the entire 400k, and we still have over a million stache, plus paid off house, plus 100k pension for the rest of our life (goes up to account for inflation).  And I still am retired at age 48. (I'd give this a less than 10% chance of happening)

Best case scenario: The 400k does something like a 5x in the next couple years, and at age 40 I have a net worth of about 3 million, and my wife and I just retire, which drastically reduces pension, but who cares, we have enough for a fat fire at 40.  (I'd give this a 40-50% chance of happening)

So basically, my thesis is that the best case scenario is more likely than the worst case scenario.  The worst case scenario doesn't markedly hurt my life in any significant way, but the best case scenario makes a big improvement in happiness. 

So even though it's a massive allocation, it doesn't seem to be a massive risk, if that makes sense?

I can almost guarantee you that at some point your crypto portfolio will see a 50% drop in value.  IDK if it will be tomorrow, or in June 2022, but people will lose interest and it will enter a decline.  Atleast that is what the trend has been and, due to the volatility we are still experiencing I do not suspect it will change anytime soon.  I am also, fairly confident that it will reach newer highs sometime after that.  However, as bullish as i am on crypto, I wouldn't bet the farm on it because government regulation can hamper that.

Personally, I could care less what anyone does with their money.  Buy Bitcoin, sell Bitcoin, curse Bitcoin - I just don't care.  But, as someone has spent considerable time doing my own research, I think the prudent thing to do is to invest a small amount into crypto (less than 3% of your network) and take profits when it surges (like right now) and to buy periodically as well (DCA maybe 1-2% of your disposable income or just wait for a real crash in price).

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #402 on: October 29, 2021, 01:36:26 PM »
It's a block reward.  It rewards you for your effort in securing the network.  Its written in the code of the whatever project we are talking about. 

Ok, so it's effectively spawned from thin air, yes? And the value that that freshly-spawned-from-thin-air token holds comes from where?

I am definitely less troubled by where the block rewards come from than where US Dollars come from and its not even close.  That is not a debate you want to get into, lol.

Like I said...
Quote
Crypto enthusiasts paint in whataboutism like DaVinci used paints.


Paint, DaVinci, paint! Nobody here is talking about currencies. We're talking about revenue-generating assets.

Its not from the air - its from the code that that the participants consent to.  Its a piece of the pie for securing the blockchain.  If you don't understand the difference between pulling something from the air (ironically, like how the US Dollar is minted) and code then I cannot help you.

Its not a whataboutism.  You criticize crypto in favor of fiat currency so naturally you have faith in the system of those fiat currencies.  I am simply pointing out, on topic, why crypto is better on this concise issue.


MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #403 on: October 29, 2021, 01:48:57 PM »
Let me try an ELI5 on it.

People hold Bitcoin in an account.  To spend it, they need to move it to someone else's account.  There are millions and millions (you're 5, right?) of computers helping with this need.

Someone decides how much of a "fee" they will pay to move Bitcoin into someone else's account.  Computers check that the person isn't cheating - that they really own that Bitcoin.  Then they try to take that fee, and build a "block" in the block chain.  Like a row of (a) and (b) blocks, where they are adding the (c).

Computers pick up the movement of Bitcoin because they want the fee each person contributes.  Computers then guess at the answer to a really hard math problem.  One of them wins, and collects all the fees in their "block".  But all the computers also agree that a new account is created to reward the computer with the right guess.  They made the next block, so they get a reward - a "block reward".

If someone tries to cheat, other computers will use math and discover they are cheating.  The cheaters are ignored, and don't get rewards.  The cheaters play in a corner by themselves with fake Bitcoin.  Everyone else uses the blocks made by millions and millions of computers.

The end.

(Is this the part where I teach kids "Just say no to crypto?")
« Last Edit: October 29, 2021, 01:54:23 PM by MustacheAndaHalf »

MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #404 on: October 29, 2021, 01:57:04 PM »
Each computer uses an account it controls, and creates a block where all the transaction fees move into it's account.  And the block reward - that moves into it's account as well.  But nobody cares, unless that computer wins the competition, and decides the next block.

The blockchain is essentially driven by greed.  Computers want to win the block reward, but they also want more money from fees.  If someone modifies their software to cheat, they will generate results that don't match all of the other computers running the original software.  The cheat will be ignored, since their block will fail to verify.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #405 on: October 29, 2021, 01:59:11 PM »
Its not from the air - its from the code that that the participants consent to.  Its a piece of the pie for securing the blockchain.  If you don't understand the difference between pulling something from the air (ironically, like how the US Dollar is minted) and code then I cannot help you.

It's an expression ;-) What I'm struggling to get you to point to is: ok, so this coin—which no money exchanged hands to create—has value, where does the value come from? And the answer is: *tada* people buying the token.

In other words, if *no new buyers* came into the market, these block rewards would dilute everybody else's holdings, and everybody would be losing money.

Let's review some of the Ponzi scheme red flags from Wikipedia [1]:
1. High investment returns with little or no risk. Does staking fit this bill? It certainly sounds like it...
2. Overly consistent returns. Sounds like it promises these, too...
3. Unregistered investments. Check...
4. Secretive or complex strategies... I'd sure say so

So once again, it may not technically fit every aspect of a Ponzi, but this staking scheme is certainly Ponzi-like.

[1] https://en.wikipedia.org/wiki/Ponzi_scheme

Its not a whataboutism.  You criticize crypto in favor of fiat currency so naturally you have faith in the system of those fiat currencies.  I am simply pointing out, on topic, why crypto is better on this concise issue.

It absolutely is. Nobody "invests" in the USD. It's a terrible investment, as any currency should be. Only you crypto maxis play this constant goal-post shifting game where, when pinned down about how a cryptocurrency is a terrible asset, revert to "WELL, USD IS WORSE!". When it's pointed out that a cryptocurrency is a terrible currency, the excuse that it's an asset, and should be thought of more like digital gold or a world computer! This is whataboutism.

This is very common behavior, for whatever reason, in crypto circles. I, frankly, find it a bit troubling. Not only because it's kinda cult-like, and makes you make really bad arguments. But because cryptocurrency is inherently very political. At its core is—in my opinion—a rather gross extreme form of anti-state libertarianism. I don't think it's a stretch to draw a direct line between that particular philosophy and some of our more... embarrassing recent political situations. I think "investing" in cryptocurrency and parroting its (bad) talking points is actively helping to spread this dangerous ideology, and is therefore harmful. I find it upsetting that it's gotten such a grip on people, because, hey, you can maybe earn a few bucks while helping to destroy democracy!
« Last Edit: October 29, 2021, 02:07:00 PM by the_gastropod »

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #406 on: October 29, 2021, 02:21:24 PM »
Let me try an ELI5 on it.

People hold Bitcoin in an account.  To spend it, they need to move it to someone else's account.  There are millions and millions (you're 5, right?) of computers helping with this need.

Someone decides how much of a "fee" they will pay to move Bitcoin into someone else's account.  Computers check that the person isn't cheating - that they really own that Bitcoin.  Then they try to take that fee, and build a "block" in the block chain.  Like a row of (a) and (b) blocks, where they are adding the (c).

Computers pick up the movement of Bitcoin because they want the fee each person contributes.  Computers then guess at the answer to a really hard math problem.  One of them wins, and collects all the fees in their "block".  But all the computers also agree that a new account is created to reward the computer with the right guess.  They made the next block, so they get a reward - a "block reward".

If someone tries to cheat, other computers will use math and discover they are cheating.  The cheaters are ignored, and don't get rewards.  The cheaters play in a corner by themselves with fake Bitcoin.  Everyone else uses the blocks made by millions and millions of computers.

The end.

(Is this the part where I teach kids "Just say no to crypto?")

If this were it, just transaction fees, there wouldn't be an issue (and the interest rates would be *significantly* lower).

The problem is the Ponzi aspect, where the bulk of the reward is in the freshly minted tokens, which have value because of the newcomers to the network. I haven't even yet brought up *this* aspect, but there is no transparency about: 1. how much leverage is in this system, 2. many of these purchases are with tether coins, loaned to companies (e.g., Bitfinex) with the very tokens purchased with the tethers used as collateral. This system is basically constructed of red flags. 

I know I keep making the MLM analogy, but that fits here, too. LuLaRoe members make some money selling pants. There's nothing inherently wrong with that. But those making any real money make the vast majority of their earnings by bringing on new LuLaRoe members. That is deeply problematic and unsustainable.
« Last Edit: October 29, 2021, 02:24:07 PM by the_gastropod »

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #407 on: October 29, 2021, 02:25:03 PM »
Its not from the air - its from the code that that the participants consent to.  Its a piece of the pie for securing the blockchain.  If you don't understand the difference between pulling something from the air (ironically, like how the US Dollar is minted) and code then I cannot help you.

It's an expression ;-) What I'm struggling to get you to point to is: ok, so this coin—which no money exchanged hands to create—has value, where does the value come from? And the answer is: *tada* people buying the token.

In other words, if *no new buyers* came into the market, these block rewards would dilute everybody else's holdings, and everybody would be losing money.

Let's review some of the Ponzi scheme red flags from Wikipedia [1]:
1. High investment returns with little or no risk. Does staking fit this bill? It certainly sounds like it...
2. Overly consistent returns. Sounds like it promises these, too...
3. Unregistered investments. Check...
4. Secretive or complex strategies... I'd sure say so

So once again, it may not technically fit every aspect of a Ponzi, but this staking scheme is certainly Ponzi-like.

[1] https://en.wikipedia.org/wiki/Ponzi_scheme

Its not a whataboutism.  You criticize crypto in favor of fiat currency so naturally you have faith in the system of those fiat currencies.  I am simply pointing out, on topic, why crypto is better on this concise issue.

It absolutely is. Nobody "invests" in the USD. It's a terrible investment, as any currency should be. Only you crypto maxis play this constant goal-post shifting game where, when pinned down about how a cryptocurrency is a terrible asset, revert to "WELL, USD IS WORSE!". When it's pointed out that a cryptocurrency is a terrible currency, the excuse that it's an asset, and should be thought of more like digital gold or a world computer! This is whataboutism.

This is very common behavior, for whatever reason, in crypto circles. I, frankly, find it a bit troubling. Not only because it's kinda cult-like, and makes you make really bad arguments. But because cryptocurrency is inherently very political. At its core is—in my opinion—a rather gross extreme form of anti-state libertarianism. I don't think it's a stretch to draw a direct line between that particular philosophy and some of our more... embarrassing recent political situations. I think "investing" in cryptocurrency and parroting its (bad) talking points is actively helping to spread this dangerous ideology, and is therefore harmful. I find it upsetting that it's gotten such a grip on people, because, hey, you can maybe earn a few bucks while helping to destroy democracy!

Have you been reading anything here about risk of staking?  For one, we are just talking about how its not risk free because you can lose your bonded amount.  Also, most of the project have 5-10% rewards and its not taken from others as a return on investment - its earned for securing the network.  You secure the network, which would not exist without stakers in a POS model, in return for getting a set block reward that is set in stone and visible to everyone.  This doesn't even remotely come close to your wikipedia argument.

Next, talk about whataboutism.  Half your post is rant out of left-field about how cryptocurrency is backed by Trump supporters that want to destroy democracy or something.  Look man, you believe what you believe, and I don't want to detract from talking about POS, but for what its worth - I am a liberal.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #408 on: October 29, 2021, 02:43:01 PM »
Have you been reading anything here about risk of staking?  For one, we are just talking about how its not risk free because you can lose your bonded amount.

Cool. These you?

Quote from: onecoolcat
Cardano for instance, uses a delegated proof of stake model inwhich you can stop staking anytime you want without penalty

Quote from: onecoolcat
but strikes are very rare and I don't think any pool has qualified for a severe strike yet

  Also, most of the project have 5-10% rewards and its not taken from others as a return on investment - its earned for securing the network.  You secure the network, which would not exist without stakers in a POS model, in return for getting a set block reward that is set in stone and visible to everyone.  This doesn't even remotely come close to your wikipedia argument.

I must really be bad at asking questions, because you still seem to be missing the point. The value of that generated reward comes from somewhere. You don't seem to grok the source of that value.

Next, talk about whataboutism.  Half your post is rant out of left-field about how cryptocurrency is backed by Trump supporters that want to destroy democracy or something.  Look man, you believe what you believe, and I don't want to detract from talking about POS, but for what its worth - I am a liberal.

I did, indeed, rant. And it was, in part, because I kind of thought you (and seemingly most?) crypto enthusiasts deep down are not people with ANCAP beliefs. But you 100% are helping to perpetuate ANCAP ideology here. I find that most people who really get into crypto never took an economics course in university or read an economics textbook. Their interest in economics began as they began to learn about cryptocurrency. And things like inflation seemed bad and weird and maybe even evil. And a fixed money supply sounded like a really good idea, and what do you know, Bitcoin has that.

These are very extreme ideologies with some pretty sinister histories.

This isn't some fringe belief. Bitcoin was designed this way on purpose.
- https://www.theatlantic.com/technology/archive/2017/05/blockchain-of-command/528543/
- https://www.washingtonpost.com/news/wonk/wp/2018/01/08/bitcoin-is-the-new-middle-ages/
« Last Edit: October 29, 2021, 02:56:24 PM by the_gastropod »

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #409 on: October 29, 2021, 03:08:15 PM »
Have you been reading anything here about risk of staking?  For one, we are just talking about how its not risk free because you can lose your bonded amount.

Cool. These you?

Quote from: onecoolcat
Cardano for instance, uses a delegated proof of stake model inwhich you can stop staking anytime you want without penalty

Quote from: onecoolcat
but strikes are very rare and I don't think any pool has qualified for a severe strike yet

  Also, most of the project have 5-10% rewards and its not taken from others as a return on investment - its earned for securing the network.  You secure the network, which would not exist without stakers in a POS model, in return for getting a set block reward that is set in stone and visible to everyone.  This doesn't even remotely come close to your wikipedia argument.

I must really be bad at asking questions, because you still seem to be missing the point. The value of that generated reward comes from somewhere. You don't seem to grok the source of that value.

Next, talk about whataboutism.  Half your post is rant out of left-field about how cryptocurrency is backed by Trump supporters that want to destroy democracy or something.  Look man, you believe what you believe, and I don't want to detract from talking about POS, but for what its worth - I am a liberal.

I did, indeed, rant. And it was, in part, because I kind of thought you (and seemingly most?) crypto enthusiasts deep down are not people with ANCAP beliefs. But you 100% are helping to perpetuate ANCAP ideology here. I find that most people who really get into crypto never took an economics course in university or read an economics textbook. Their interest in economics began as they began to learn about cryptocurrency. And things like inflation seemed bad and weird and maybe even evil. And a fixed money supply sounded like a really good idea, and what do you know, Bitcoin has that.

These are very extreme ideologies with some pretty sinister histories.

This isn't some fringe belief. Bitcoin was designed this way on purpose.
- https://www.theatlantic.com/technology/archive/2017/05/blockchain-of-command/528543/
- https://www.washingtonpost.com/news/wonk/wp/2018/01/08/bitcoin-is-the-new-middle-ages/

Yeah, those are me and they are entirely consistent with everything else I said.  I feel like i am talking to a wall here but at least now we know your criticisms come from a place of irrational hatred of cryptocurrencies based upon assumptions about those who own it.  You know what they say about assumptions?

dandarc

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Re: What do you think of adding a low% of crypto allocation
« Reply #410 on: October 29, 2021, 03:13:22 PM »
So, onecoolcat, since you are so rational actually answer the question - where does your investment return come from? As Jerry McGuire's client said - show me the money!

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #411 on: October 29, 2021, 03:16:20 PM »
So, onecoolcat, since you are so rational actually answer the question - where does your investment return come from? As Jerry McGuire's client said - show me the money!

Mostly from people buying my VTSMX at a higher price than I paid for it.  You?

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #412 on: October 29, 2021, 03:19:06 PM »
Yeah, those are me and they are entirely consistent with everything else I said.  I feel like i am talking to a wall here but at least now we know your criticisms come from a place of irrational hatred of cryptocurrencies based upon assumptions about those who own it.  You know what they say about assumptions?

Agreed. This shall be my final response to you:

I do not hate the people who hold cryptocurrency. As I stated, the system was designed around a set of ideas. I do not like those ideas, and believe them to be dangerous. I believe most crypto enthusiasts lack understanding of these systems and the effects they were designed to produce.

maizefolk

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Re: What do you think of adding a low% of crypto allocation
« Reply #413 on: October 29, 2021, 03:20:47 PM »
Can anyone give a simple "ELI5" example of the source of interest payments from staking?

Sure thing. It comes from two sources:

1) The block reward. These are new units of currency which are created by the built in rules of the currency and controlled by whoever produced that particular block (in bitcoin the amount of new currency declines over time towards and ultimately reaching zero). This is the same way the fed creates new units of dollars when it buys governments bonds or other securities.

2) Transaction fees. These are existing units of currency that people who want to transfer currency from one wallet to another pay to have their transactions processed. In principle transaction fees can be zero, but if there are more transactions that people want to make queued up than room to make them in a current block, the transactions with the highest fees cut to the front of the line. This is like the percentage of each transaction that goes to mastercard/visa/paypal when you make a payment using one of those avanue to move dollars around.

Cool. I appreciate the straightforwardness :)

For item 1, do you see any trouble with that? Is there value in this block reward that's summoned from nothing? Where's the value come from?

Define trouble?

The value of the new units of whatever cryptocurrency are created as part of a block reward come from the same place the value of new USD comes from when the fed decides the economy needs quantitative easing*: People are placing value on the existing units (for whatever reason) and these new units are fungible with the old units so they also have value. In both cases if you create a lot of new units, people will value individual units less so issuing more units doesn't really create NEW value, it's moving a tiny fraction of the existing value from all the existing units into the new ones.

In normal currencies we'd call that inflation. In cryptocurrencies, the amount of value people place on them jumps around so much for other reasons at the moment that the small amount of value being shifted to existing units to newly created units is hard or impossible to measure.

*Or when the fed pays out whatever interest rate they've set each quarter on bank reserves I think. Although I'm less sure about that one as it's not a topic I know much about.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #414 on: October 29, 2021, 03:26:28 PM »
Define trouble?

The value of the new units of whatever cryptocurrency are created as part of a block reward come from the same place the value of new USD comes from when the fed decides the economy needs quantitative easing*: People are placing value on the existing units (for whatever reason) and these new units are fungible with the old units so they also have value. In both cases if you create a lot of new units, people will value individual units less so issuing more units doesn't really create NEW value, it's moving a tiny fraction of the existing value from all the existing units into the new ones.

In normal currencies we'd call that inflation. In cryptocurrencies, the amount of value people place on them jumps around so much for other reasons at the moment that the small amount of value being shifted to existing units to newly created units is hard or impossible to measure.

*Or when the fed pays out whatever interest rate they've set each quarter on bank reserves I think. Although I'm less sure about that one as it's not a topic I know much about.

Yep. I think you are very close to getting my point. This behaves much in the same way a Ponzi scheme does: existing investors (stakers) are paid out in tokens whose value depends on new investment into the scheme. That’s it.

There is a lot of techno-babble and complexity around it, but it’s ultimately irrelevant from a strictly financial perspective.

maizefolk

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Re: What do you think of adding a low% of crypto allocation
« Reply #415 on: October 29, 2021, 03:33:16 PM »
Yep. I think you are very close to getting my point. This behaves much in the same way a Ponzi scheme does: existing investors (stakers) are paid out in tokens whose value depends on new investment into the scheme. That’s it.

There is a lot of techno-babble and complexity around it, but it’s ultimately irrelevant from a strictly financial perspective.

Yup. I can see the point you are making. But I do hope you realize that if you apply the concept of a ponzi scheme that broadly then the federal reserve also behaves much in the same way as a ponzi scheme since the interest they pay out on banks deposits with them is also in the form of newly created tokens that depend on the value people place on those tokens.

Money (in whatever form) is a fascinating social phenomenon, it makes our civilization possible, and it's also a terrible investment vehicle.

Telecaster

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Re: What do you think of adding a low% of crypto allocation
« Reply #416 on: October 29, 2021, 09:49:11 PM »
Yep. I think you are very close to getting my point. This behaves much in the same way a Ponzi scheme does: existing investors (stakers) are paid out in tokens whose value depends on new investment into the scheme. That’s it.

There is a lot of techno-babble and complexity around it, but it’s ultimately irrelevant from a strictly financial perspective.

Yup. I can see the point you are making. But I do hope you realize that if you apply the concept of a ponzi scheme that broadly then the federal reserve also behaves much in the same way as a ponzi scheme since the interest they pay out on banks deposits with them is also in the form of newly created tokens that depend on the value people place on those tokens.

The easiest way to deal with this is to simply use the existing definitions.  A Ponzi scheme is a type of fraud.  Bitcoin is does not meet that definition.  The Federal Reserve is not fraud either.   When we start using wrong definitions then discussions get sidetracked.   

maizefolk

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Re: What do you think of adding a low% of crypto allocation
« Reply #417 on: October 29, 2021, 10:03:08 PM »
Yep. I think you are very close to getting my point. This behaves much in the same way a Ponzi scheme does: existing investors (stakers) are paid out in tokens whose value depends on new investment into the scheme. That’s it.

There is a lot of techno-babble and complexity around it, but it’s ultimately irrelevant from a strictly financial perspective.

Yup. I can see the point you are making. But I do hope you realize that if you apply the concept of a ponzi scheme that broadly then the federal reserve also behaves much in the same way as a ponzi scheme since the interest they pay out on banks deposits with them is also in the form of newly created tokens that depend on the value people place on those tokens.

The easiest way to deal with this is to simply use the existing definitions.  A Ponzi scheme is a type of fraud.  Bitcoin is does not meet that definition.  The Federal Reserve is not fraud either.   When we start using wrong definitions then discussions get sidetracked.

I agree that leads to a clearer discussion.

At the same time it's been my observation that when people try to redefine words in order to try to win arguments it is often more effective to think through point out the other ridiculous implications of their new proposed definitions of words that already have existing meanings than to just argue with them that they are using words to mean things that most speakers of the english language don't understand those words to me.

MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #418 on: October 30, 2021, 03:25:01 AM »
Let me try an ELI5 on it.

People hold Bitcoin in an account.  To spend it, they need to move it to someone else's account.  There are millions and millions (you're 5, right?) of computers helping with this need.

Someone decides how much of a "fee" they will pay to move Bitcoin into someone else's account.  Computers check that the person isn't cheating - that they really own that Bitcoin.  Then they try to take that fee, and build a "block" in the block chain.  Like a row of (a) and (b) blocks, where they are adding the (c).

Computers pick up the movement of Bitcoin because they want the fee each person contributes.  Computers then guess at the answer to a really hard math problem.  One of them wins, and collects all the fees in their "block".  But all the computers also agree that a new account is created to reward the computer with the right guess.  They made the next block, so they get a reward - a "block reward".

If someone tries to cheat, other computers will use math and discover they are cheating.  The cheaters are ignored, and don't get rewards.  The cheaters play in a corner by themselves with fake Bitcoin.  Everyone else uses the blocks made by millions and millions of computers.

The end.

(Is this the part where I teach kids "Just say no to crypto?")
If this were it, just transaction fees, there wouldn't be an issue (and the interest rates would be *significantly* lower).

The problem is the Ponzi aspect, where the bulk of the reward is in the freshly minted tokens, which have value because of the newcomers to the network. I haven't even yet brought up *this* aspect, but there is no transparency about: 1. how much leverage is in this system, 2. many of these purchases are with tether coins, loaned to companies (e.g., Bitfinex) with the very tokens purchased with the tethers used as collateral. This system is basically constructed of red flags. 

I know I keep making the MLM analogy, but that fits here, too. LuLaRoe members make some money selling pants. There's nothing inherently wrong with that. But those making any real money make the vast majority of their earnings by bringing on new LuLaRoe members. That is deeply problematic and unsustainable.
Notice how you say "if this were it", like I left something out.  I mentioned both transaction fees and block rewards, not just transaction fees as you implied.

"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

A Ponzi scheme collapses when there's too many withdrawals.  Bitcoin has been through multiple crashes of greater than 90%.  Ponzi schemes don't survive that.

Are you even aware that open source software runs the Bitcoin Blockchain?  You can download all the blockchain data, and view the code yourself.  There's nothing hidden.  Does that sound like a fraud?  Everything in public view?

If you have a problem with staking, my post said nothing about it.  It's not relevant to my post.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #419 on: October 30, 2021, 04:47:13 AM »
Notice how you say "if this were it", like I left something out.  I mentioned both transaction fees and block rewards, not just transaction fees as you implied.

Ah, sorry. It wasn’t clear to me that “block reward” meant “freshly minted cryptocurrency tokens”. I thought you meant the reward was just the transaction fees.

"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

…I don’t know how to respond. This should be self-evident. This isn’t really a debatable point—this is how the system operates. Let me try to illustrate:

- 10 coins exist, 5 held by Alice, 5 by Bob. The coins are cumulatively are worth $10. That is $1 / coin
- Alice buys a widget from Bob, and pays him 1 coin.
- The transaction is verified, a new coin is minted
- There are now 11 coins in the system
- How much is each coin worth now? (The answer is ~$0.91)
- How does that get valued back up to $1 or higher?

Are you even aware that open source software runs the Bitcoin Blockchain?  You can download all the blockchain data, and view the code yourself.  There's nothing hidden.  Does that sound like a fraud?  Everything in public view?

If you have a problem with staking, my post said nothing about it.  It's not relevant to my post.

To bring out the MLM analogy again—MLM contracts are readable, the system of MLM’s have been around for over half a century and they’re typically completely legal! Nor are they technically ponzis. No fraud there, either. But I’d hardly suggest participating is a wise decision.

My original question was specifically about the source of revenues one earns from staking. Many responses later, no one has successfully answered. I’m trying to show y’all the answer, but there is much hard-headedness 😂
« Last Edit: October 30, 2021, 04:49:15 AM by the_gastropod »

boarder42

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Re: What do you think of adding a low% of crypto allocation
« Reply #420 on: October 30, 2021, 06:20:36 AM »
Notice how you say "if this were it", like I left something out.  I mentioned both transaction fees and block rewards, not just transaction fees as you implied.

Ah, sorry. It wasn’t clear to me that “block reward” meant “freshly minted cryptocurrency tokens”. I thought you meant the reward was just the transaction fees.

"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

…I don’t know how to respond. This should be self-evident. This isn’t really a debatable point—this is how the system operates. Let me try to illustrate:

- 10 coins exist, 5 held by Alice, 5 by Bob. The coins are cumulatively are worth $10. That is $1 / coin
- Alice buys a widget from Bob, and pays him 1 coin.
- The transaction is verified, a new coin is minted
- There are now 11 coins in the system
- How much is each coin worth now? (The answer is ~$0.91)
- How does that get valued back up to $1 or higher?

Are you even aware that open source software runs the Bitcoin Blockchain?  You can download all the blockchain data, and view the code yourself.  There's nothing hidden.  Does that sound like a fraud?  Everything in public view?

If you have a problem with staking, my post said nothing about it.  It's not relevant to my post.

To bring out the MLM analogy again—MLM contracts are readable, the system of MLM’s have been around for over half a century and they’re typically completely legal! Nor are they technically ponzis. No fraud there, either. But I’d hardly suggest participating is a wise decision.

My original question was specifically about the source of revenues one earns from staking. Many responses later, no one has successfully answered. I’m trying to show y’all the answer, but there is much hard-headedness 😂

You're arguing with someone who is citing the last 10-15 years as reasons for investing strategy in multiple threads on here. Also someone trading gme options I'm not sure it's worth the effort.

MOD NOTE: Attack an argument, not a person, please.
« Last Edit: November 03, 2021, 09:25:54 PM by arebelspy »

maizefolk

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Re: What do you think of adding a low% of crypto allocation
« Reply #421 on: October 30, 2021, 09:51:28 AM »
"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

…I don’t know how to respond. This should be self-evident. This isn’t really a debatable point—this is how the system operates. Let me try to illustrate:

- 10 coins exist, 5 held by Alice, 5 by Bob. The coins are cumulatively are worth $10. That is $1 / coin
- Alice buys a widget from Bob, and pays him 1 coin.
- The transaction is verified, a new coin is minted
- There are now 11 coins in the system
- How much is each coin worth now? (The answer is ~$0.91)
- How does that get valued back up to $1 or higher?


You're asking a separate question about how the value of a currency is set, which is different from the point that each unit of a currency has the same value as each other unit.

When there are 10 coins in the system each is worth the same as every other coin. When there are 11 coins in the system each is worth the same as every other coin because units of currency are fungible. You, like Peter Schiff and other gold bugs, are argue that creating a new units of a currency out of thin air inflates away the value of each unit of the currency in a precise mathematical relationship. Schiff is constantly running around complaining that, because the fed created an extra $3T since the start of 2020 and doubled the M0 money supply, that means all of our dollars are inherently worth half as much. I don't know about you, but while prices have gone up a little, it certainly does not cost me 2x as much to buy the same things I would buy in 2019. Has your cost of living doubled since the start of 2020?

In any case, let's imagine you and Peter Schiff were right and the value of currencies were determined by some mathematical formula and not the emergent behavior of hordes of irrational human beings. Even so, that doesn't require any newcomers to participate in a cryptocurrency in order to transfer value to the people who are either mining or staking. The block reward transfers value from all holders of existing coins to the people doing the mining or staking. Transaction fees transfer value from people making transactions to people doing the mining and staking. And that system for transferring value works perfectly well even if the creation of 10% more units of currency (1.1/1) inherently produces an approximately ~9% decline in the value of the currency (1/1.1).

I (and many others) have explained to you multiple times in different ways is that what seems to be bothering you about how cryptocurrencies work is actually how ALL currencies work. New units are created out of thin air, whether by a computer algorithm, an expert at the fed pushing a button, or (back in the day) a printing press stamping words on a piece of paper, or (further back in the day) somebody dumping extra lead into a crucible of molten metal so the same amount of silver would produce more total coins. In every case each unit is worth the same as each other unit. In every case the value of the units of a currency will change over time for a whole host of reasons (including as a result of creating new units of the currency, but, as the example of the dollar shows, not by a fixed and predictable mathematical formula).

Telecaster

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Re: What do you think of adding a low% of crypto allocation
« Reply #422 on: October 30, 2021, 10:38:46 AM »
So, onecoolcat, since you are so rational actually answer the question - where does your investment return come from? As Jerry McGuire's client said - show me the money!

Mostly from people buying my VTSMX at a higher price than I paid for it.  You?

That's incomplete.  It is like saying it gets dark because the sun goes down without explaining why the sun goes down.     Why does VTSMX go up in price?  Over any reasonably long period of time, the broader markets increase in price by GDP growth, plus inflation, plus dividends.  That's exactly as you'd expect.  To put it another way, the price (ultimately) goes up because the underlying businesses make more money and therefore become more valuable.  Obviously, the price can be whacky in either direction, but over time the returns follow that formula. 

Why does Bitcoin go up in price?   Bitcoin goes up in price because more people want to own it today than owned it yesterday.  Supply and demand.  That's it.  There is no underlying enterprise that is generating value. 

ChpBstrd

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Re: What do you think of adding a low% of crypto allocation
« Reply #423 on: November 01, 2021, 01:01:48 PM »
https://www.cnn.com/2021/11/01/investing/squid-game-cryptocurrency-scam/index.html?utm_source=optzlynewmarketribbon

^Does this nudge anyone into admitting "well, maybe it could all be a giant pump and dump scam"?

Or do the particulars get in the way? I.e. that cryptocurrency had a different name / smaller market cap than the ones I'm invested in.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #424 on: November 01, 2021, 01:28:55 PM »
I don't think bitcoin is a pump and dump scam.  The price has risen so much and it has been around for so long now that I have to believe anyone considering pumping and dumping would have done so already.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #425 on: November 01, 2021, 03:09:59 PM »
I don't think bitcoin is a pump and dump scam.  The price has risen so much and it has been around for so long now that I have to believe anyone considering pumping and dumping would have done so already.

I'm not so sure. I don't think it's outside the realm of possibility that the whole market is fraudulent. With Tether, there's possibly ~$60B of completely fabricated-from-thin-air fake Tether dollars being used to pump up the value of many cryptocurrencies. I think Tether has been "dumping" USD from the system and re-injecting fake USDT, maintaining just enough USD to handle day-to-day withdrawals and YOLOing it until then.

Here's a flowchart of how this scheme could work:

Sourced from: https://medium.com/nerd-for-tech/greatest-scam-in-history-by-tether-76ac059b9550

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #426 on: November 01, 2021, 05:41:14 PM »
What timing! The Treasury just put out a report on stable coins very much suggesting Tether is a huge systemic risk.  https://home.treasury.gov/system/files/136/StableCoinReport_Nov1_508.pdf

MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #427 on: November 02, 2021, 09:13:29 AM »
Notice how you say "if this were it", like I left something out.  I mentioned both transaction fees and block rewards, not just transaction fees as you implied.

Ah, sorry. It wasn’t clear to me that “block reward” meant “freshly minted cryptocurrency tokens”. I thought you meant the reward was just the transaction fees.

"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

…I don’t know how to respond. This should be self-evident. This isn’t really a debatable point—this is how the system operates. Let me try to illustrate:

- 10 coins exist, 5 held by Alice, 5 by Bob. The coins are cumulatively are worth $10. That is $1 / coin
- Alice buys a widget from Bob, and pays him 1 coin.
- The transaction is verified, a new coin is minted
- There are now 11 coins in the system
- How much is each coin worth now? (The answer is ~$0.91)
- How does that get valued back up to $1 or higher?

Are you even aware that open source software runs the Bitcoin Blockchain?  You can download all the blockchain data, and view the code yourself.  There's nothing hidden.  Does that sound like a fraud?  Everything in public view?

If you have a problem with staking, my post said nothing about it.  It's not relevant to my post.

To bring out the MLM analogy again—MLM contracts are readable, the system of MLM’s have been around for over half a century and they’re typically completely legal! Nor are they technically ponzis. No fraud there, either. But I’d hardly suggest participating is a wise decision.

My original question was specifically about the source of revenues one earns from staking. Many responses later, no one has successfully answered. I’m trying to show y’all the answer, but there is much hard-headedness 😂

You're arguing with someone who is citing the last 10-15 years as reasons for investing strategy in multiple threads on here. Also someone trading gme options I'm not sure it's worth the effort.
You like to do character assassination, do you?

Could you quote where I say "the last 10-15 years" determine investment strategy?  When you attack someone, maybe you should be accurate, instead of slandering them?

Nothing in your post relates to the content of what I posted earlier in this thread.  If you think that's how this forum works, re-read the forum rules.  It's not.

MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #428 on: November 02, 2021, 09:18:37 AM »
"Freshly minted tokens" have the same value as all other Bitcoin.  How can you say those tokens "have value because of the newcomers"?  That claim is false - new Bitcoins have the exact same value as all other Bitcoins.

…I don’t know how to respond. This should be self-evident. This isn’t really a debatable point—this is how the system operates. Let me try to illustrate:

- 10 coins exist, 5 held by Alice, 5 by Bob. The coins are cumulatively are worth $10. That is $1 / coin
- Alice buys a widget from Bob, and pays him 1 coin.
- The transaction is verified, a new coin is minted
- There are now 11 coins in the system
- How much is each coin worth now? (The answer is ~$0.91)
- How does that get valued back up to $1 or higher?
Maybe you don't know what to say because you removed the key quote that started this part of the discussion.  Here it is, quoted again:

The problem is the Ponzi aspect, where the bulk of the reward is in the freshly minted tokens, which have value because of the newcomers to the network.
Here you said "freshly minted tokens, which have value because of newcomers to the network".  Is that false or not?  That was my point, not the strawman argument about coins going above $1, which I never brought up.

Freshly minted tokens do not go up in isolation from other tokens.  Or drop in isolation - all tokens have the same value.  So it was incorrect to single out freshly minted tokens as being the only one which have value owing to newcomers.

mattpew

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Re: What do you think of adding a low% of crypto allocation
« Reply #429 on: November 02, 2021, 04:44:40 PM »
Unfamiliar with Crypto - hoping someone can answer this:

It seems the valuation of cryptocurrency is a result of weighing the downside risk of a given token being obsolete (worthless) vs the massive upside of potentially replacing a portion of the current fiat currency system.

Is this a correct take?

Furthermore - if that is correct, what reason do investors currently have to believe that the existing power structure supporting fiat currency will be so amicable in relinquishing this incredible power?  It seems fairly easy to regulate on the supply side (ie make it illegal for businesses to accept payment in cryptocurrency) to effectively nullify the bull case.

Any help is appreciated.

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #430 on: November 02, 2021, 06:15:00 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

solon

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Re: What do you think of adding a low% of crypto allocation
« Reply #431 on: November 02, 2021, 08:18:33 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

boarder42

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Re: What do you think of adding a low% of crypto allocation
« Reply #432 on: November 02, 2021, 08:36:45 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

I was told earlier it could be a currency bc a consensus could decide to change the 21 million limit. So is it actually a limit?  Also scarcity of something does not make it valuable. Definition of value is determined by humans. Today it has value. Tomorrow it could be worth 0. It's 100% a human emotion play giving value to this thing. It doesn't produce anything. It doesn't do anything except people are stuffing it in their "mattresses" it's an anomaly of a digital age and an inflated market with people misunderstanding the stock market as a risky gamble. And then assuming BTC is the same risky gamble but look at the returns. Fomo heaven. Likely propped up on illegal stable coins and over marketing. 1929 rush on stable coins comes and this all collapses.

onecoolcat

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Re: What do you think of adding a low% of crypto allocation
« Reply #433 on: November 02, 2021, 09:44:08 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

I was told earlier it could be a currency bc a consensus could decide to change the 21 million limit. So is it actually a limit?  Also scarcity of something does not make it valuable. Definition of value is determined by humans. Today it has value. Tomorrow it could be worth 0. It's 100% a human emotion play giving value to this thing. It doesn't produce anything. It doesn't do anything except people are stuffing it in their "mattresses" it's an anomaly of a digital age and an inflated market with people misunderstanding the stock market as a risky gamble. And then assuming BTC is the same risky gamble but look at the returns. Fomo heaven. Likely propped up on illegal stable coins and over marketing. 1929 rush on stable coins comes and this all collapses.

That is not what you were told.  Bitcoin has been described as many things; an asset, a currency, even a commodity.  Contrary to your obsession, there is nothing fundamentally wrong with it occupying each of those spaces depending upon how the owner treats it.  In the end, its governed by the code and secured by the network that we value.  If that has no value to you then don't buy it.  No one cares.   

BicycleB

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Re: What do you think of adding a low% of crypto allocation
« Reply #434 on: November 02, 2021, 11:07:30 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

Very direct answer, much respect for that.

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #435 on: November 02, 2021, 11:19:57 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

boarder42

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Re: What do you think of adding a low% of crypto allocation
« Reply #436 on: November 03, 2021, 04:58:48 AM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.
« Last Edit: November 03, 2021, 05:15:18 AM by boarder42 »

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #437 on: November 03, 2021, 05:30:32 AM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.
« Last Edit: November 03, 2021, 05:33:01 AM by Juan Ponce de León »

boarder42

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Re: What do you think of adding a low% of crypto allocation
« Reply #438 on: November 03, 2021, 05:37:20 AM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.

i'm not upset over it i've got more money than i'll ever need invested in predictable long term assets.

this entire thread is an opinion thread on our thoughts of adding crypto - hope you're right - you being right doesn't negatively affect me in any way.  but it could negatively affect future investments for those who choose to use 6 year returns and FOMO as reasons for "investing" in something.  I bought lottery tickets for 6 years and i won 1B dollars now i'm going to "invest" 100MM a year in lotto tickets!

talltexan

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Re: What do you think of adding a low% of crypto allocation
« Reply #439 on: November 03, 2021, 06:49:27 AM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #440 on: November 03, 2021, 12:21:49 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

talltexan

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Re: What do you think of adding a low% of crypto allocation
« Reply #441 on: November 03, 2021, 12:48:10 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

Do you have a number/spreadsheet somewhere where you're tracking this, or is it more of a "gut" thing?

forgerator

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Re: What do you think of adding a low% of crypto allocation
« Reply #442 on: November 03, 2021, 02:31:36 PM »
Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

it looks like me and you are exactly the same person! Been observing BTC first when it was around $100 in 2012, then $1k in 2013. Followed its crash back to $100 after the Mount Gox fiasco and dismissed it as a fad / ponzi. Then when I heard in Dec 2017 that BTC was at $17k I had had enough and invested a small bag and also in a smattering of other alts mostly in Eth. That's when everything crashed but I kept buying dips again and again. Today around 50% of my NW is tied to crypto. Not the most wise decision but at this point I am failing to see any other asset class outperform crypto, everything else including stocks looks dull and old fashioned.
I too am looking to offload a good chunk early next year depending on a 2017 style parabolic run, and yes I cash out my DeFi yields every day for some of the most lucrative passive income I have ever generated (even high risk REITS don't come close).
My plan by mid next year - start a huge stable coin LP on beefy.finance or other compounding vaults, stake for 20% returns and re-enter crypto as it goes through yet another boom to bust cycle.

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Re: What do you think of adding a low% of crypto allocation
« Reply #443 on: November 03, 2021, 02:51:45 PM »

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

Sorry if I missed this earlier. If you don't mind my asking, @Juan Ponce de León, what % of your portfolio is in crypto vs conventional financial assets?

Is % the way you allocate to the non-crypto portion, or do you have other criteria instead (5 years' conventional assets, paid off house but the rest is crypto, etc)?

Are you seeking a FIRE target in some conventional way (eg, 25x annual spending) or using other goals for your accumulation strategies?

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #444 on: November 03, 2021, 05:07:02 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

So bitcoin isn't a currency. It's an asset?

It's literally called a cryptocurrency.

It's quite obviously an asset, it has a current market cap of nearly $1.2Trillion.  You can call it whatever you want and by this stage it doesn't matter what the original intentions of some supposed Japanese guy in a basement were when he created Bitcoin, bitcoin is now it's own beast and all that matters now is how bitcoin is being used and valued and adopted globally and where it is headed into the future.  Bitcoin and crypto in general is here to stay, I honestly would not want to be one of the people who knew all about bitcoin in these early days, argued about it on the internet all day until they were blue in the face but never owned any and completely missed the bus. 

Soon Bitcoins market cap value will flip silver and after that there is only Amazon, Google, Saudi Aramco, Apple and Microsoft to go on the way to flipping Gold which is about a 10x away for BTC.  For reference BTC has done roughly a 238x since 2015.  It has been said that Bitcoin is a monetary black hole that will suck up and dominate all other asset classes.  I'm yet to see anything to suggest that it is not progressively doing exactly that.

so its only gone up since 2015 so based on that information i've decided it can only go up and dominate the world.  Good luck 6 years is an infinitely small time in the money game.

and FOMO sorry i missed that part of your post in the middle there. 

so there we have it folks the reason to hold BTC is FOMO and it always goes up.  If you don't have FOMO over this and don't believe 6 years of it always goes up makes it "a long term investment" there is no reason to be in it.

You sound very upset, please try not to get emotional over this.  I'll stick to my opinion and you stick to yours.  My opinion has made me a lot of money this year so I'm fairly happy with it for now.  Let's see what the future brings.  So exciting isn't it.

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

Do you have a number/spreadsheet somewhere where you're tracking this, or is it more of a "gut" thing?

There's portfolio tracking sites that keep an eye on a lot of it for you, you just enter in your wallet addresses.

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Re: What do you think of adding a low% of crypto allocation
« Reply #445 on: November 03, 2021, 05:11:33 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

I was told earlier it could be a currency bc a consensus could decide to change the 21 million limit. So is it actually a limit?  Also scarcity of something does not make it valuable. Definition of value is determined by humans. Today it has value. Tomorrow it could be worth 0. It's 100% a human emotion play giving value to this thing. It doesn't produce anything. It doesn't do anything except people are stuffing it in their "mattresses" it's an anomaly of a digital age and an inflated market with people misunderstanding the stock market as a risky gamble. And then assuming BTC is the same risky gamble but look at the returns. Fomo heaven. Likely propped up on illegal stable coins and over marketing. 1929 rush on stable coins comes and this all collapses.

That is not what you were told.  Bitcoin has been described as many things; an asset, a currency, even a commodity.  Contrary to your obsession, there is nothing fundamentally wrong with it occupying each of those spaces depending upon how the owner treats it.  In the end, its governed by the code and secured by the network that we value.  If that has no value to you then don't buy it.  No one cares.

He just likes to rile up the troops:). He must have seen the latest media article on stable coins - now he's even more confused. Obviously jumped to the conclusion that they are now illegal. Clueless.
You can buy them all day on any of the US exchanges and earn 8-9-10% interest on them at places like Block Fi.
He just forgot to insert "illegal beanie babies collection" his usual MO when giving his three or four liner diatribe on crypto.

All the President's Work Group said in their report about stable coins is that they want to regulate stablecoins.
The report calls for legislation to limit stable coin issuance to "insured depositories" aka banks and credit unions.

It is no surprise that the FED and the SEC/CFTC want full control, stable coins are a threat to the system. The banks just want the money back that flowed out of our no-interest bank accounts into crypto.
This is of course US-centric for US$ backed/pegged stable coins. We want regulation for crypto - so there you go.

In essence, this is just another indication that crypto is here to stay. It will work itself out. It's not like Mastercard or Visa will give up their new blockchain technology giving them speed and security and of course profit. The banks get their funds and custodial powers and everyone will benefit from the efficiency of the payment platforms from the hedge funds to the little guy sending money home to Timbuktu.

The idea that bitcoin is 'likely propped up on illegal stable coins" is so out in left field it is laughable.
Bitcoin and stable coins have nothing at all to do with each other. That's like pointing to the sun and calling it the moon.     

boarder42

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Re: What do you think of adding a low% of crypto allocation
« Reply #446 on: November 03, 2021, 05:29:04 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

I was told earlier it could be a currency bc a consensus could decide to change the 21 million limit. So is it actually a limit?  Also scarcity of something does not make it valuable. Definition of value is determined by humans. Today it has value. Tomorrow it could be worth 0. It's 100% a human emotion play giving value to this thing. It doesn't produce anything. It doesn't do anything except people are stuffing it in their "mattresses" it's an anomaly of a digital age and an inflated market with people misunderstanding the stock market as a risky gamble. And then assuming BTC is the same risky gamble but look at the returns. Fomo heaven. Likely propped up on illegal stable coins and over marketing. 1929 rush on stable coins comes and this all collapses.

That is not what you were told.  Bitcoin has been described as many things; an asset, a currency, even a commodity.  Contrary to your obsession, there is nothing fundamentally wrong with it occupying each of those spaces depending upon how the owner treats it.  In the end, its governed by the code and secured by the network that we value.  If that has no value to you then don't buy it.  No one cares.

He just likes to rile up the troops:). He must have seen the latest media article on stable coins - now he's even more confused. Obviously jumped to the conclusion that they are now illegal. Clueless.
You can buy them all day on any of the US exchanges and earn 8-9-10% interest on them at places like Block Fi.
He just forgot to insert "illegal beanie babies collection" his usual MO when giving his three or four liner diatribe on crypto.

All the President's Work Group said in their report about stable coins is that they want to regulate stablecoins.
The report calls for legislation to limit stable coin issuance to "insured depositories" aka banks and credit unions.

It is no surprise that the FED and the SEC/CFTC want full control, stable coins are a threat to the system. The banks just want the money back that flowed out of our no-interest bank accounts into crypto.
This is of course US-centric for US$ backed/pegged stable coins. We want regulation for crypto - so there you go.

In essence, this is just another indication that crypto is here to stay. It will work itself out. It's not like Mastercard or Visa will give up their new blockchain technology giving them speed and security and of course profit. The banks get their funds and custodial powers and everyone will benefit from the efficiency of the payment platforms from the hedge funds to the little guy sending money home to Timbuktu.

The idea that bitcoin is 'likely propped up on illegal stable coins" is so out in left field it is laughable.
Bitcoin and stable coins have nothing at all to do with each other. That's like pointing to the sun and calling it the moon.   

Almost like point at BTC and saying to the moon bc look at the last 6 years. I got moon analogies all day.


Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #447 on: November 03, 2021, 05:46:32 PM »

@Juan Ponce de León , are there conditions under which you'd sell some Bitcoin to lock in those gains?

Yeah absolutely.  If we get a parabolic move up I'll be looking to de-risk some but mainly from my alt coin positions which I have way too much of.  I also cash out some of my defi yield every week but mainly I use it to buy more crypto.

Sorry if I missed this earlier. If you don't mind my asking, @Juan Ponce de León, what % of your portfolio is in crypto vs conventional financial assets?

Is % the way you allocate to the non-crypto portion, or do you have other criteria instead (5 years' conventional assets, paid off house but the rest is crypto, etc)?

Are you seeking a FIRE target in some conventional way (eg, 25x annual spending) or using other goals for your accumulation strategies?

It's about 60/40 crypto vs stocks.  That was never the plan it's just the way it's worked out.  I don't put any new money into crypto and I try not to pull too much out, I'm basically playing with house money now so I'm happy to let it ride.  I'm not getting ahead of myself in regards to FIRE targets or anything like that.  If it happens, it happens.  If it all crashes to zero I'll diversify into tulip bulbs.

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Re: What do you think of adding a low% of crypto allocation
« Reply #448 on: November 03, 2021, 06:11:47 PM »
Bitcoin doesn't go up in value because it may one day be used in businesses to buy goods and services.  It goes up in value because it is a scarce asset  that people want to hold and don't want to sell.  There's only 21 million bitcoins and that's all there will ever be.  The network is still in its growth phase with millions of new users coming in and we're all just fighting for a piece of that pie.  The amount traded on exchanges which sets the price is actually very low, the vast majority of bitcoin is stored away in offline wallets for the long term, no one is looking to spend it in shops, noone spends gold bullion or apple shares in shops either, it's a long term investment.

I was told earlier it could be a currency bc a consensus could decide to change the 21 million limit. So is it actually a limit?  Also scarcity of something does not make it valuable. Definition of value is determined by humans. Today it has value. Tomorrow it could be worth 0. It's 100% a human emotion play giving value to this thing. It doesn't produce anything. It doesn't do anything except people are stuffing it in their "mattresses" it's an anomaly of a digital age and an inflated market with people misunderstanding the stock market as a risky gamble. And then assuming BTC is the same risky gamble but look at the returns. Fomo heaven. Likely propped up on illegal stable coins and over marketing. 1929 rush on stable coins comes and this all collapses.

That is not what you were told.  Bitcoin has been described as many things; an asset, a currency, even a commodity.  Contrary to your obsession, there is nothing fundamentally wrong with it occupying each of those spaces depending upon how the owner treats it.  In the end, its governed by the code and secured by the network that we value.  If that has no value to you then don't buy it.  No one cares.

He just likes to rile up the troops:). He must have seen the latest media article on stable coins - now he's even more confused. Obviously jumped to the conclusion that they are now illegal. Clueless.
You can buy them all day on any of the US exchanges and earn 8-9-10% interest on them at places like Block Fi.
He just forgot to insert "illegal beanie babies collection" his usual MO when giving his three or four liner diatribe on crypto.

All the President's Work Group said in their report about stable coins is that they want to regulate stablecoins.
The report calls for legislation to limit stable coin issuance to "insured depositories" aka banks and credit unions.

It is no surprise that the FED and the SEC/CFTC want full control, stable coins are a threat to the system. The banks just want the money back that flowed out of our no-interest bank accounts into crypto.
This is of course US-centric for US$ backed/pegged stable coins. We want regulation for crypto - so there you go.

In essence, this is just another indication that crypto is here to stay. It will work itself out. It's not like Mastercard or Visa will give up their new blockchain technology giving them speed and security and of course profit. The banks get their funds and custodial powers and everyone will benefit from the efficiency of the payment platforms from the hedge funds to the little guy sending money home to Timbuktu.

The idea that bitcoin is 'likely propped up on illegal stable coins" is so out in left field it is laughable.
Bitcoin and stable coins have nothing at all to do with each other. That's like pointing to the sun and calling it the moon.   

Almost like point at BTC and saying to the moon bc look at the last 6 years. I got moon analogies all day.

Anyone that bought BTC back then doesn't need to look to the moon, they're already on the moon LMAO

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Re: What do you think of adding a low% of crypto allocation
« Reply #449 on: November 04, 2021, 08:26:47 AM »
According to Yahoo Finance, BTC opened at $403.66/BTC on Nov 4, 2015.  Currently, BTC costs $62328.90/BTC, for a gain of +15,441% in the past 6 years. Someone who put their $5,500 IRA contribution into BTC in 2015 should probably consider diversifying the $849,252 worth of BTC they're holding.