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The issue I have with Bitcoin is that people invest in it thinking that they are investing in cryptocurrencies, which is in your words what everybody knows will

by hnarn 9y ago

The issue I have with Bitcoin is that people invest in it thinking that they are investing in cryptocurrencies, which is in your words what everybody knows will "be a thing". The problem is that they're investing in one very specific cryptocurrency, and there is no way of knowing if it's the one that will succeed. It's equally possible that we're seeing the pets.com or myspace of crypto-currencies -- failed projects in a genre that will change pretty much everything. It's the complete lack of understanding that worries me, and what makes me almost certain this is a bubble that will come down crashing hard.

Retric 9y ago
Exactly, the odds that something else wins are very high, but picking the winner is going to be difficult and possibly not profitable. Really, look for something that can scale to a billion users while incentives are linked to being useful not being an investment as they have different optimizations.
- PeterisP 9y ago
  As the original article states, if you're sure that the concept is really going to be a big thing but you don't have a way to pick out the future winner, then investing proportionally in all of them can be highly profitable - as in the example of the dotcom bubble, if you invested in all of the IPOs, it'd eventually be very profitable; most of your investments are in losers, but the few winners make up for them.
  - Retric 9y ago
    IPO's are inherently an investment, a successful electronic currency on the other hand can get massive adoption without making early adopters rich.
FooHentai 9y ago
"Social media is certainly going to be of great importance, so I will invest heavily in Myspace"
- hectorr1 9y ago
  One nice thing for retail investors in open markets (as opposed to strategic investors like VCs in private markets) is that there is no pressure to pick only one winner.
xorcist 9y ago
Bitcoin bootstrapped from nothing. Every other coin since then bootstrapped from Bitcoin.

by hnarn 9y ago

Retric 9y ago

Exactly, the odds that something else wins are very high, but picking the winner is going to be difficult and possibly not profitable. Really, look for something that can scale to a billion users while incentives are linked to being useful not being an investment as they have different optimizations.

PeterisP 9y ago
As the original article states, if you're sure that the concept is really going to be a big thing but you don't have a way to pick out the future winner, then investing proportionally in all of them can be highly profitable - as in the example of the dotcom bubble, if you invested in all of the IPOs, it'd eventually be very profitable; most of your investments are in losers, but the few winners make up for them.
- Retric 9y ago
  IPO's are inherently an investment, a successful electronic currency on the other hand can get massive adoption without making early adopters rich.

FooHentai 9y ago

"Social media is certainly going to be of great importance, so I will invest heavily in Myspace"

hectorr1 9y ago
One nice thing for retail investors in open markets (as opposed to strategic investors like VCs in private markets) is that there is no pressure to pick only one winner.

xorcist 9y ago

Bitcoin bootstrapped from nothing. Every other coin since then bootstrapped from Bitcoin.