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Bitcoin would be the ~20th largest company in the S&P by market cap. Hardly a penny stock.

analognoise 7y ago
Given the volatility, few if any actual uses, the fraudulent exchanges, crackdown by the SEC, value based entirely on speculation, and not producing anything useful, you're right. It is way worse than penny stocks, and it is unfair to penny stocks to compare them to crypto currencies.
DagAgren 7y ago
Bitcoin's "market cap" is completely imaginary.
- loblollyboy 7y ago
  There are companies offering completely useless software 'solutions' that don't even do their useless task well and many of them have stock prices that have grown 100% + since the bailouts, even if they haven't updated their technology since before then. How is the value of BTC more fake than that?
  - papln 7y ago
    The difference is that if management of the average publicly traded stock shopped it around, they could probably find a buyer for 50% or more of current market cap. Maybe not for the biggest companies like Amazon and Apple. If a substantial fraction of BTC owners tried to exit, they'd have more trouble getting close to nominal value.
    - Acrobatic_Road 7y ago
      For something like this a metric known as enterprise value is used. Assets - cash + debt AKA the takeover price. You can find these numbers on the company's balance sheet. The average company is traded at something like 3.5x their book value (Assets - debt). The market value of a company is likewise some multiple of their EV.
    - DagAgren 7y ago
      That is understating the situation quite a bit. Volume is so non-existent that basically any attempt at exiting at all would crater the price.
empath75 7y ago
Market cap is an absurd metric for cryptocurrencies. If print a billion tokens and sell you one for a dollar, it’s a billion dollar market cap.
- buboard 7y ago
  so are stocks
  - CamelCaseName 7y ago
    Stocks are, generally, asset backed and revenue generating.
    - buboard 7y ago
      the market cap isn't asset backed. it reflects potential future revenue
- DesiLurker 7y ago
  there is an old adage I recall in trading.. "volume justifies price". so if you can sell your shiny new coin for a dollar a token with a billion such tokens outstanding & you can do it with any significant volume then yeah it would be a billion dollar cap coin. Nice strawman though!

Given the volatility, few if any actual uses, the fraudulent exchanges, crackdown by the SEC, value based entirely on speculation, and not producing anything useful, you're right. It is way worse than penny stocks, and it is unfair to penny stocks to compare them to crypto currencies.

DagAgren 7y ago

Bitcoin's "market cap" is completely imaginary.

loblollyboy 7y ago
There are companies offering completely useless software 'solutions' that don't even do their useless task well and many of them have stock prices that have grown 100% + since the bailouts, even if they haven't updated their technology since before then. How is the value of BTC more fake than that?
- papln 7y ago
  The difference is that if management of the average publicly traded stock shopped it around, they could probably find a buyer for 50% or more of current market cap. Maybe not for the biggest companies like Amazon and Apple. If a substantial fraction of BTC owners tried to exit, they'd have more trouble getting close to nominal value.
  - Acrobatic_Road 7y ago
    For something like this a metric known as enterprise value is used. Assets - cash + debt AKA the takeover price. You can find these numbers on the company's balance sheet. The average company is traded at something like 3.5x their book value (Assets - debt). The market value of a company is likewise some multiple of their EV.
  - DagAgren 7y ago
    That is understating the situation quite a bit. Volume is so non-existent that basically any attempt at exiting at all would crater the price.

empath75 7y ago

Market cap is an absurd metric for cryptocurrencies. If print a billion tokens and sell you one for a dollar, it’s a billion dollar market cap.

buboard 7y ago
so are stocks
- CamelCaseName 7y ago
  Stocks are, generally, asset backed and revenue generating.
  - buboard 7y ago
    the market cap isn't asset backed. it reflects potential future revenue
DesiLurker 7y ago
there is an old adage I recall in trading.. "volume justifies price". so if you can sell your shiny new coin for a dollar a token with a billion such tokens outstanding & you can do it with any significant volume then yeah it would be a billion dollar cap coin. Nice strawman though!