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The suicide prevention hotline is pinned to the top of cryptocurrency subreddits because the price of bitcoin is where it was at the beginning of last month. Th

• deleted 9y ago
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• olivermarks 9y ago
  Naive speculators are buying cryptocurrencies on their credit cards without understanding the volatility https://www.bloomberg.com/news/articles/2018-01-11/bitcoin-buyers-turn-to-credit-cards-as-fomo-breeds-risk-taking https://www.bloomberg.com/news/articles/2018-01-11/bitcoin-b...
  • matwood 9y ago
    How much I think is key here. I'll try and find the article from late 2017 but it said that most crypto buyers invested ~3k or less. A large portion of BTC is concentrated in fewer than 1k people. What this means is that for most people when crypto crashes, it sucks but will simply be a cool story. This isn't .com or the housing bubble where many people's lives were ruined. Of course with the craze, the stats could have changed over the last few months.
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    • vertex-four 9y ago
      The question is whether people have invested a significant amount of their life savings in bitcoin, not whether they own a significant amount of bitcoin proportional to the total market. For people who have, they may be panicking about how they'll support themselves in their later years, they may have invested in a lifestyle with the expectation that they can pay for it with Bitcoin's growth, and so on and so forth. People's lives may be ruined by this - they've often essentially been scammed into investing in cryptocurrency because they cannot understand the risks. If a financial adviser were promoting bitcoin to most people, it'd be illegal. I don't think it's fair to say this is OK because it won't affect people you know.
      • matwood 9y ago
        The stats were not just people I know. One of the coin sites pulled them together. If 3k is a significant amount of someone's life savings, then they should not have put in BTC. Proportional to the total market is important because it puts into perspective how few people will really be impacted, and if it is something that could spread into the economy as a whole. Found the stats: https://coinspectator.com/news/127996/survey-finds-average-bitcoin-investment-under-3k-most-plan-to-own-less-than-3-years https://coinspectator.com/news/127996/survey-finds-average-b...
        • vertex-four 9y ago
          > If 3k is a significant amount of someone's life savings, then they should not have put in BTC. No, they shouldn't have. But many people don't actually understand what a high-risk market is, and especially not one as volatile as Bitcoin. They've heard their cousin/friend/waiter made a couple thousand bucks off it, done some googling, and found several thousand people saying this is the next big thing, with fancy graphs and miracle use cases and so on and so forth to prove it. Big well-known news sources like Bloomberg talking about it, and how big well-known investment banks are interested in it. This is the end result of what lack of regulation looks like. People get bamboozled - similar to many scams, you might get tricked into losing a couple of hundred bucks and calling it a life lesson, or you might get scammed into losing your life savings and winding up in severe debt. A few people (and it's more than a few) being impacted enough to cause them to be extremely worried about how they'll pay their bills, how they'll afford to keep a roof over their head in their later years, is important. It's maybe not as important to you as widespread economic collapse, but it's nothing to pretend isn't an issue. The comment you were originally replying to wasn't talking about economic collapse - it was talking about the impact on individual people.
        • saalweachter 9y ago
          > If 3k is a significant amount of someone's life savings, then they should not have put in BTC. Is that an appeal to consequences or did you have a different point?
    • wslh 9y ago
      Beyond the concentration, there are a lot of millionaries out there. Much more than 1k. I always tell that I know more crypto-millionaries than startup ones.
      • dsacco 9y ago
        And how many members do you know of each, in absolute terms?
        • wslh 9y ago
          What matters is the ratio: 1 to 10 only thinking about the closest ones.
          • dsacco 9y ago
            Sure, but a 1000% higher likelihood is close to meaningless if we’re talking about extremely tiny fractions in absolute terms. For example, a substance that increases your baseline risk of some type of cancer from 0.000003% to 0.00003% is basically imperceptible in a population of 300M people. That’s 90 incidents instead of 9 incidents out of the entire United States. You don’t have to tell me exact figures for how many people you personally know in each category, but my point is that if both figures are sufficiently small in absolute terms then the example is meaningless.
            • wslh 9y ago
              Your analysis is wrong. Startups and crypto investments can be seen as bets and a 10x increase in favor of you is a lot. And you are not taking into account the effort factor: startups are hard while storing some cryptoassets works even when you sleep. Not saying this will work forever, just saying that many people found it lucky to enjoy the momentum.
              • dsacco 9y ago
                > Your analysis is wrong. Startups and crypto investments can be seen as bets and a 10x increase in favor of you is a lot. So you think a 1000% increase in likelihood to win the lottery is meaningful? I’m not saying a 1000% increase is insignificant relatively speaking. I’m saying that in the absolute context, it can be essentially meaningless. Which circles back to my point: you should add an absolute context to your numbers instead of just saying you know more cryptocurrency millionaires than startup millionaires.
  • JumpCrisscross 9y ago
    > Naive speculators The problem with this characterization is when enough people lose their shirts on leveraged crypto purchases, a problem of individual finances becomes one of collective policy. I'd be careful with dismissing the problem as one contained to the stupid. There was a thread on the front page, earlier, where multiple commentators were equated the odds of a massive and permanent Bitcoin crash with that of a meteor impacting the earth [1]. Multiple people honestly could not imagine how Bitcoin could possibly become absolutely worthless. These are otherwise-reasonable people who, through a combination of misinformation and FOMO, got involved in something over their heads. Korea may be at the point where a 50% sustained drawdown plunges a significant fraction of the population into hardship. That, in turn, could trigger a recession. In case it needs to be said, now is not a good time for the Seoul to plunge into a financial and political crisis. I've gone from finding this Bitcoin fascinating, to being cautiously weary, to being outright dismissive, to becoming worried about systemic risks. [1] https://news.ycombinator.com/item?id=16160346 https://news.ycombinator.com/item?id=16160346
    • dahdum 9y ago
      > Korea may already be at the point where a 50% sustained drawdown plunges a significant fraction of the population into hardship. That, in turn, could trigger a recession. That seems unlikely. Something like 2M of 51M people have any crypto there, and only a small fraction would be overextended significantly. Anyone buying a couple months ago would still be up.
      • JumpCrisscross 9y ago
        > Something like 2M of 51M people have any crypto there, and only a small fraction would be overextended significantly How do you know that? For traditional securities, we have margin and prudential lending rules. These systems aren't perfect. But they incorporate lessons from crises past. One of those lessons is about how system risk can grow exponentially unexpectedly quickly.
        • justrobert 9y ago
  • danibx 9y ago
    Not everyone that buys with credit card does so because they don't have money. Many people do this because this is the fastest way to move money to an exchange. Wire transfers to exchanges sometimes wait for weeks before they are confirmed.
    • pishpash 9y ago
      No public, known, good investment suddenly becomes a bad investment in a few weeks, unless something terrible happens in between.
      • semi-extrinsic 9y ago
        You must not have held gold in October of 1997. Price had been stable for years, then it dropped 13% in two months on no specific underlying news. There's tons of examples like this.
  • saas_co_de 9y ago
    The same people would probably be recklessly borrowing money to gamble and waste on other worthless crap if bitcoin wasn't around so I don't think bitcoin is really an exceptional thing here. Just a run-of-the-mill scam and run-of-the-mill stupid people. However, those people will be demanding government intervention when their money is gone, so get ready for the regulatory party! Pretty safe to predict that bitcoin will the the Bernie Madoff of this business cycle.
  • jstarfish 9y ago
    Not true, it's a very savvy move. You're gambling with someone else's money-- credit card debt can be discharged in bankruptcy. You don't lose your house or your shirt, and the only real consequence is poor credit for a few years. And if bitcoin goes up? Pay it off, keep the profits...you still win.
    • celticninja 9y ago
      In a bankruptcy that was for personal debt such as credit cards surely your house as an asset can be sold in the event of a bankruptcy?
      • Phlarp 9y ago
        Perfect play for the van dwelling SV crowd (or renters anywhere). What are they going to put a lien on when the most expensive thing you own is a macbook pro?
      • jstarfish 9y ago
        Not if it's your primary residence. Your summer home or a rental property, sure.
        • celticninja 9y ago
          Where is this? In the UK and from what I could see in the US it would be included.
          • jstarfish 9y ago
            The US, through the provisions of the bankruptcy homestead exemption. Though having just looked into it again, they only allow you to retain up to a certain amount of equity in your primary residence-- anything more than that (or other properties you own) is considered an asset that can be leveraged to pay back your debts, as you suggest. So someone with a cheap house or little equity could still Bain Capital themselves with Bitcoin, declare bankruptcy and start over while avoiding homelessness. But if you're 90% of the way through a half-million-dollar mortgage then yeah you'll have a lien placed on the property. http://www.alllaw.com/articles/nolo/bankruptcy/homestead-exemption.html http://www.alllaw.com/articles/nolo/bankruptcy/homestead-exe...
  • celticninja 9y ago
    I took out a loan to buy bitcoin. I got a $10k loan in 2013, the loan was paid off in 2015. I have taken out considerably more in profit than I invested and still have most of my bitcoins. Prior to that I had bought bitcoin when it was very cheap ($3-$5) and sold it because I needed money to buy a house, once the house purchase was completed I took out the loan to buy back in. Also, at least here in the UK it is possible to arrange credit card debt to be 0% so not every investor who uses a loan or credit card to purchase btc is naive.
• matwood 9y ago
  Yeah, people love to overreact. I follow the reddit investing forum sometimes, and people go nuts with 'plunge' and 'crash' when a tech stock moves -1%.
  • Insanity 9y ago
    Well, I think that might be explained due to the popularity of cryptocurrencies amongst an audience that is otherwise not economically inclined. They end up spending some money on bitcoin due to "hearsay" or what they read in the news, and think they can quickly make a lot of money. Without an understanding of how much can actually be lost. So when this happens, they might not think in percentages but in "how much did I just loose". Combined with the regret of "I wish I sold earlier". This is just me speculating, I have no idea if that's what goes on in their mind, I just imagine it is.
    • jgh 9y ago
      Youre probably not far off. I’ve been hearing TA works better on cryptocurrency markets than regular stock markets, probably because like you say it’s mostly relatively unsophisticated investors.
    • ganoushoreilly 9y ago
      This is actually one reason for Accredited investor certification. When you read posts about people saying they can't afford rent now because of the down swing, it's a very tricky situation and one that could / should have been prevented. It's as if the financials industry had to go through these same issues to get where it is now.
      • fuzzyfroghunter 9y ago
        I wonder, how much of the accredited investor certification is also about protecting wealthier investors from the kind of volatility/irrationality we are seeing in cryptocurrency prices stemming from fresh and unseasoned investors?
• jacquesm 9y ago
  > The suicide prevention hotline is pinned to the top of cryptocurrency subreddits because the price of bitcoin is where it was at the beginning of last month. Where on the page? https://www.reddit.com/r/Bitcoin/ https://www.reddit.com/r/Bitcoin/ Or a different page?
  • austenallred 9y ago
    reddit.com/r/cryptocurrency
    • bdcravens 9y ago
      Any others? > cryptocurrency subredditS
    • jacquesm 9y ago
      Wow, that's harsh.
• bdcravens 9y ago
  > The suicide prevention hotline is pinned to the top of cryptocurrency subreddits Which ones? I checked r/bitcoin, r/btc, r/ethereum, r/litecoin, r/bitcoinmarkets. Only one I saw with it was r/cryptocurrency
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  • joosters 9y ago
    r/buttcoin, one of the sanest cryptocurrency subreddits out there in this blockchain madness.
    • gruez 9y ago
      >r/buttcoin so akin to pinning the suicide prevention hotline on /r/the_donald after trump won?
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  • gruez 9y ago
    it's a rumor/meme. supposedly during the last crash, r/bitcoin had the suicide hotline pinned, but i wasn't able to confirm that on archive.org either.
    • whyenot 9y ago
      It was pinned at the top of /r/bitcoin for a brief time during the crash in January 2014. I was there. I saw it, although I realize that wouldn't necessarily be convincing evidence to someone else. While it's easy to make fun of the suicide prevention hotline being posted (and many did make fun of it in 2014), at least one regular poster in /r/BitcoinMarkets did commit suicide during that crash.
• swarnie_ 9y ago
  That's not without precedence, the currency has half in price before and the same threads got stuck at the top. In the future this saga will be a great anthropological study.
• paulpauper 9y ago
  I don't see it. sometimes I see it but not this time
• jonknee 9y ago
  Well it doesn't matter what it was last month if you just took the plunge... So many stories of people putting in their college funds, taking out loans, using credit cards, exchange margin, etc.
  • denkmoon 9y ago
    Taking any form of fiat credit to buy cryptocurrencies is where the pedal hits the metal in terms of stupidity.
• nebulous1 9y ago
  People make bad decisions. While it would be odd to be suicidal if you held bitcoin over the period you mentioned, there will be people who bought in at the top. There will also be a smaller subset of people who overextended themselves and bought in at the top. All I'm saying is that there could be people who are genuinely in trouble now, regardless of how short the time was.
  • austenallred 9y ago
    It's more a comment on the volatility than anything. People see that something is up 100% in one month and assume it won't lose 25% of value the next. We humans are not super rational.
    • pishpash 9y ago
      It's not like bitcoin hasn't had a record of price history, yet still when people see sh*t shooting up they don't consider it a sign of volatility, but rather return. Read this: http://www.businessinsider.com/bitcoin-volatility-risk-adjusted-return-worse-than-stocks-2017-12 http://www.businessinsider.com/bitcoin-volatility-risk-adjus... What this is telling you is, if you wanted a lot of excitement for potential gain, you could have always leveraged up your ho-hum retirement account and done better.
• JustAnotherPat 9y ago
  Well this ignores the fact that it's down 50% for its ATH and some altcoins are down 5x+. So some people ARE looking at steep losses. Please tell what people would do if the S&P got cut in half.
• wmeredith 9y ago
  I also thought this was really a bad sign. People in that sub are day trading and getting annoyed with 50% gain in 24 hours. It's a crazy atmosphere.
• oil7abibi 9y ago
  It’s a joke...