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The more interesting part of the post is in the 'Why I did it' section. I'd be interested to hear what others have to say on the topic considering I was about t

The more interesting part of the post is in the 'Why I did it' section. I'd be interested to hear what others have to say on the topic considering I was about to invest some money into cryptos.

defen 9y ago
I think a healthy step 0 for anyone is to get into the mindset that you're not "investing" into cryptos, you're speculating or gambling.
- jonny_eh 9y ago
  Absolutely true, but that's also the case of most stock trading. If you're not buying a stock expecting dividends, but instead hoping to just sell it for more later, that's not much different than speculating on BTC.
  - scott_s 9y ago
    I think that buying into stock index funds expecting to sell your shares for more in several decades is different than speculating on BTC.
    - djKianoosh 9y ago
      what makes one index fund better than another?
      - scott_s 9y ago
        Not much! Which is the point. You choose index funds based on lower expense ratio, how spread they are in the market (more spread means lower risk and more likely to just replicate performance of the overall market; less spread means higher risk and less likely to replicate the performance of the overall market), and how much you trust the institution running it.
  - lurr 9y ago
    Except I can buy a stock expecting it to increase on the merits of what the company is doing. I could have bought stock in Apple the day I saw an iPhone for the first time, and would have made money off it.
    - justincormack 9y ago
      bitcoin is not making an iphone, there are no fundamentals. But what you describe is still gambling.
      - vkou 9y ago
        Holding USD is another form of gambling. Buying a house to live in is gambling. The thing is that USD can be used to pay taxes in April, a house provides you shelter, a share of APPL entitles you to small fraction of the company... And a bitcoin entitles you to a mathematical number, with nothing backing it.
      - mthoms 9y ago
        Both Bitcoin and AAPL stock carry a risk of losing money due to unknowable future events. Therefore aren't they both gambling? It seems to me that it's just the degree of risk that varies.
        fnovd 9y ago
        Bitcoin isn't growing in value because it represents shares of a business that makes real money: it's growing in value because demand is increasing. You can directly connect AAPL's profitability with the value of the phones and computers they produce. Bitcoin does not have such an analogue. The "asset" behind Bitcoin is one part the group of miners who consider to keep the ledger going, one part the ability to facilitate a trade using that shared ledger, and three parts speculation. It's the speculative component that makes it, and all other cryptocurrency, more gambling than investment.
        mthoms 9y ago
  - tw04 9y ago
    That's not even remotely true. Stocks are directly tied to the performance of a company providing goods or services. There's something you can directly gauge. At BEST you could equate it to currency trading, but even THAT is tied to real-world governments and their policies nine times out of ten. Bitcoin is literally trading on the belief that a bunch of people are going to switch to it instead of the dollar or insert your currency of choice because...?
    - mthoms 9y ago
      > That's not even remotely true. Stocks are directly tied to the performance of a company providing goods or services. There's something you can directly gauge. I'm no stock expert but isn't the majority of a stock's value due to speculation on what it will be worth one day in the future? I think the parent made a valid point. Sure, stocks are generally easier to "gauge" (and therefore lower risk) but you're still just speculating that it's future price will be greater than it's current price after all. Low-risk gambling is still gambling isn't it?
      - AlexandrB 9y ago
        > I'm no stock expert but isn't the majority of a stock's value due to speculation on what it will be worth one day in the future? That's true, but stock can represent a portion of an asset with production potential. A factory or a mine or a dot-com. Bitcoin is pure fiat money. If I owned all stock in AAPL, I would own one of the most valuable companies in the world which would yield me several billion USD in profits every year. If I owned all bitcoins my asset would be completely worthless because there would be no market for it. I defer to Warren Buffett's quote [1] on Gold - an asset similar in it's uselessness: > Today the world's gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce -- gold's price as I write this -- its value would be $9.6 trillion. Call this cube pile A. > Let's now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world's most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-aroundmoney (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B? [1] http://www.nasdaq.com/article/why-warren-buffett-hates-gold-cm267928 http://www.nasdaq.com/article/why-warren-buffett-hates-gold-...
  - mancerayder 9y ago
    Yes, especially if you trade stocks on a short-term basis. Stocks can be long, rational plays based upon performance, evaluation, analysis of quarterly results and news clippings. But they can also be greedy speculation. They are both of these things. Something the 'Bitcoin isn't based on anything asset wise' crowd forgets. Even if they're right in that statement.
- deleted 9y ago
  [deleted]
- oreo81 9y ago
  Just stop, you have no idea their intentions so don't assume they're gambling.
  - defen 9y ago
    Intentions don't matter; it's a function of the underlying asset. The worst stock market crash in US history was Black Monday in 1987 which resulted in a 22.6% drop in the DJA. Bitcoin has already experienced much worse crashes than that, multiple times (like the time it dropped 94% in 2011). I'm not saying don't put money into Bitcoin/cryptos; I'm saying don't put in more than you would feel comfortable losing at a casino.
    - oreo81 9y ago
      Intentions do matter though, it's not about the money to some people. Some people understand how revolutionary a decentralized economy would be and want to take part in trying to implement something they believe in. If it's all about making a quick buck then yes, it's gambling. Don't assume money is everything to everyone. I don't feel comfortable losing any money at a casino, that money goes to an industry that I don't care to support; But I'd be fine losing money in crypto because It's something I want to support.
      - saalweachter 9y ago
        Serious question. How does buying and holding Bitcoin promote a decentralized economy?
        JonnyNova 9y ago
        It doesn't. It pushes the value up and certainly gets more eyes on it but a rising market cap of cryptos doesn't suddenly defeat fiat currencies when a magic threshold is reached.
        oreo81 9y ago
sbierwagen 9y ago
I like Matt Levine's take: https://www.bloomberg.com/view/articles/2017-11-30/bitcoin-frenzy-and-trendy-computers https://www.bloomberg.com/view/articles/2017-11-30/bitcoin-f... >The main question is: In one or five or 50 years, will everyone on earth want to use bitcoin, or a lot of people, or a few people, or nobody? There are no fundamentals, no cash flows or price-earnings ratios, to evaluate. It is pure speculation about speculation, a Keynesian beauty contest where all the pictures are blank. >[...] >Arguments about bitcoin are like every other shouty argument about financial markets, but with a void at their core. "Bitcoin is capitalism, distilled," says Adam Ludwin, but it isn't quite; bitcoin traders are not allocating capital to productive uses in the real world. Bitcoin is finance, distilled, though, in the narrow sense that the distillation throws away all the messy productive real-world consequences of finance and leaves you with just an abstract thing to trade.
Steeeve 9y ago
If you are the 12,000th player in the pyramid scheme it doesn't end well.
- jacquesm 9y ago
  That depends on how big the pool of potential players is and how much money they're prepared to put into the scheme.
jraedisch 9y ago
For me the reason to sell at the moment is quite banal: I do not want to spend time thinking about investing over the holidays, and I do not want to feel like I should pick out my phone.
- mudil 9y ago
  You see, it's not easy to sell.

The more interesting part of the post is in the 'Why I did it' section. I'd be interested to hear what others have to say on the topic considering I was about to invest some money into cryptos.

defen 9y ago

I think a healthy step 0 for anyone is to get into the mindset that you're not "investing" into cryptos, you're speculating or gambling.

jonny_eh 9y ago
Absolutely true, but that's also the case of most stock trading. If you're not buying a stock expecting dividends, but instead hoping to just sell it for more later, that's not much different than speculating on BTC.
- scott_s 9y ago
  I think that buying into stock index funds expecting to sell your shares for more in several decades is different than speculating on BTC.
  - djKianoosh 9y ago
    what makes one index fund better than another?
    - scott_s 9y ago
      Not much! Which is the point. You choose index funds based on lower expense ratio, how spread they are in the market (more spread means lower risk and more likely to just replicate performance of the overall market; less spread means higher risk and less likely to replicate the performance of the overall market), and how much you trust the institution running it.
- lurr 9y ago
  Except I can buy a stock expecting it to increase on the merits of what the company is doing. I could have bought stock in Apple the day I saw an iPhone for the first time, and would have made money off it.
  - justincormack 9y ago
    bitcoin is not making an iphone, there are no fundamentals. But what you describe is still gambling.
    - vkou 9y ago
      Holding USD is another form of gambling. Buying a house to live in is gambling. The thing is that USD can be used to pay taxes in April, a house provides you shelter, a share of APPL entitles you to small fraction of the company... And a bitcoin entitles you to a mathematical number, with nothing backing it.
    - mthoms 9y ago
      Both Bitcoin and AAPL stock carry a risk of losing money due to unknowable future events. Therefore aren't they both gambling? It seems to me that it's just the degree of risk that varies.
      - fnovd 9y ago
        Bitcoin isn't growing in value because it represents shares of a business that makes real money: it's growing in value because demand is increasing. You can directly connect AAPL's profitability with the value of the phones and computers they produce. Bitcoin does not have such an analogue. The "asset" behind Bitcoin is one part the group of miners who consider to keep the ledger going, one part the ability to facilitate a trade using that shared ledger, and three parts speculation. It's the speculative component that makes it, and all other cryptocurrency, more gambling than investment.
        mthoms 9y ago
- tw04 9y ago
  That's not even remotely true. Stocks are directly tied to the performance of a company providing goods or services. There's something you can directly gauge. At BEST you could equate it to currency trading, but even THAT is tied to real-world governments and their policies nine times out of ten. Bitcoin is literally trading on the belief that a bunch of people are going to switch to it instead of the dollar or insert your currency of choice because...?
  - mthoms 9y ago
    > That's not even remotely true. Stocks are directly tied to the performance of a company providing goods or services. There's something you can directly gauge. I'm no stock expert but isn't the majority of a stock's value due to speculation on what it will be worth one day in the future? I think the parent made a valid point. Sure, stocks are generally easier to "gauge" (and therefore lower risk) but you're still just speculating that it's future price will be greater than it's current price after all. Low-risk gambling is still gambling isn't it?
    - AlexandrB 9y ago
      > I'm no stock expert but isn't the majority of a stock's value due to speculation on what it will be worth one day in the future? That's true, but stock can represent a portion of an asset with production potential. A factory or a mine or a dot-com. Bitcoin is pure fiat money. If I owned all stock in AAPL, I would own one of the most valuable companies in the world which would yield me several billion USD in profits every year. If I owned all bitcoins my asset would be completely worthless because there would be no market for it. I defer to Warren Buffett's quote [1] on Gold - an asset similar in it's uselessness: > Today the world's gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce -- gold's price as I write this -- its value would be $9.6 trillion. Call this cube pile A. > Let's now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world's most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-aroundmoney (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B? [1] http://www.nasdaq.com/article/why-warren-buffett-hates-gold-cm267928 http://www.nasdaq.com/article/why-warren-buffett-hates-gold-...
- mancerayder 9y ago
  Yes, especially if you trade stocks on a short-term basis. Stocks can be long, rational plays based upon performance, evaluation, analysis of quarterly results and news clippings. But they can also be greedy speculation. They are both of these things. Something the 'Bitcoin isn't based on anything asset wise' crowd forgets. Even if they're right in that statement.
deleted 9y ago
[deleted]
oreo81 9y ago
Just stop, you have no idea their intentions so don't assume they're gambling.
- defen 9y ago
  Intentions don't matter; it's a function of the underlying asset. The worst stock market crash in US history was Black Monday in 1987 which resulted in a 22.6% drop in the DJA. Bitcoin has already experienced much worse crashes than that, multiple times (like the time it dropped 94% in 2011). I'm not saying don't put money into Bitcoin/cryptos; I'm saying don't put in more than you would feel comfortable losing at a casino.
  - oreo81 9y ago
    Intentions do matter though, it's not about the money to some people. Some people understand how revolutionary a decentralized economy would be and want to take part in trying to implement something they believe in. If it's all about making a quick buck then yes, it's gambling. Don't assume money is everything to everyone. I don't feel comfortable losing any money at a casino, that money goes to an industry that I don't care to support; But I'd be fine losing money in crypto because It's something I want to support.
    - saalweachter 9y ago
      Serious question. How does buying and holding Bitcoin promote a decentralized economy?
      - JonnyNova 9y ago
        It doesn't. It pushes the value up and certainly gets more eyes on it but a rising market cap of cryptos doesn't suddenly defeat fiat currencies when a magic threshold is reached.
        oreo81 9y ago

sbierwagen 9y ago

I like Matt Levine's take: https://www.bloomberg.com/view/articles/2017-11-30/bitcoin-frenzy-and-trendy-computers https://www.bloomberg.com/view/articles/2017-11-30/bitcoin-f... >The main question is: In one or five or 50 years, will everyone on earth want to use bitcoin, or a lot of people, or a few people, or nobody? There are no fundamentals, no cash flows or price-earnings ratios, to evaluate. It is pure speculation about speculation, a Keynesian beauty contest where all the pictures are blank. >[...] >Arguments about bitcoin are like every other shouty argument about financial markets, but with a void at their core. "Bitcoin is capitalism, distilled," says Adam Ludwin, but it isn't quite; bitcoin traders are not allocating capital to productive uses in the real world. Bitcoin is finance, distilled, though, in the narrow sense that the distillation throws away all the messy productive real-world consequences of finance and leaves you with just an abstract thing to trade.

Steeeve 9y ago

If you are the 12,000th player in the pyramid scheme it doesn't end well.

jacquesm 9y ago
That depends on how big the pool of potential players is and how much money they're prepared to put into the scheme.

jraedisch 9y ago

For me the reason to sell at the moment is quite banal: I do not want to spend time thinking about investing over the holidays, and I do not want to feel like I should pick out my phone.

mudil 9y ago
You see, it's not easy to sell.