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The thing that has surprised me the most with the current crypto-craze is the number of people that I consider generally quite rational/thoughtful who could non

The thing that has surprised me the most with the current crypto-craze is the number of people that I consider generally quite rational/thoughtful who could nonetheless not resist the temptation to jump onto the bandwagon. I'm left thinking that they must know what they're doing and that they simply enjoy the thrill of a game of musical chairs.

randomopining 6y ago
It’s a deflationary store of value, it does make sense to invest some into it.
- FriendlyNormie 6y ago
  Hello there, retard. Tell us what you’ve learned throughout all the research you’ve done on Tether. Oh, nothing? Kill yourself.
- HarryHirsch 6y ago
  store of value The value comes from being able to manipulate the price, one would suppose.
  - fsdfgsfsdfsdfsd 6y ago
    How can you manipulate the price? I suppose there are now some whales, including governments that seized BTC from criminals, that could induce a crash by selling thousands of BTC within a short frame of time. But that may be true for many stocks as well.
  - strathmeyer 6y ago
    The more dumb stuff people say about Bitcoin, the more room you know it has to rise.
    - paulryanrogers 6y ago
      Why is the comment dumb?
      - fsdfgsfsdfsdfsd 6y ago
        Because it is not so easy to manipulate the price, presumably. It depends on the trading volume. For many "altcoins" or "shitcoins" it may be true, because they have low trading volume. Bitcoin probably less so these days.
        ricardo81 6y ago
        Given the market cap of 800 billion for BTC at the moment, presumably it should by relatively hard to manipulate. I'd read elsewhere that there was a tiny minority of BTC holders that own 95% of it, no idea of the authenticity of that. As a Layman, my assumption is the more liquidity in the market, the harder it would be to manipulate and less reason to dump onto the market if a large stakeholder.
        fsdfgsfsdfsdfsd 6y ago
        I think some of the whales could make the price tank, at least temporarily. They include some governments who seized thousands of BTC from criminal operations. But I think the same applies to many stocks. If Musk of Bezos would sell off a majority of their shares in their own companies, it would perhaps also move the price. At the moment, crashes in Bitcoin can also be seen as a good thing because it helps give more people access to Bitcoin. It's even possible that some of the stakeholders (whales with thousands of BTC) occasionally deliberately induce crashes for exactly that purpose.
- xyzelement 6y ago
  There's only so much that my dog can poop per day. Some of the poop gets lost when I scoop it off the sidewalk. And eventually he will die and not poop any more. Thus my dog's turds are a deflationary store of value but I wouldn't say "it makes sense to invest in some." Disclosure - I made up the dog.
  - thebean11 6y ago
    The dismissiveness of (presumably) otherwise thoughtful people on this forum still surprises me. Do you really find that comparison valuable in evaluating the tech?
    - xyzelement 6y ago
      I was looking to make a finance, not tech point. Specifically that there are many things that are finite and "deflationary" but obviously without value. Point being that the scarcity argument of bitcoin is on its own not persuasive. I used the cheeky example of dog poop because I though it was cute but I guess it was"too cute" and obscured the point.
      - Calamity 6y ago
        I think your point was made and those who are actually listening have understood it ;) I think your analogy does a good job in conveying the point that deflationary =/= valuable. Almost ironically, having a deflationary system is something one would really like to avoid if you thought about it. It only rewards hoarding. The king, with his hoard of gold, only grow's richer by the year. As long as he is cash flow positive, the supply upon which the peasants rely on to trade shrinks and therefore the value of each grain increases. I, for one, don't think this system is one we should be rushing to return to.
        jcpham2 6y ago
        Don’t confuse deflationary with the lack of fungibility. No physical currency can be divided into 10 million pieces, no one has a crystal ball.
14 6y ago
I think it is a high risk high reward system. For some there is very little risk in investing several thousand dollars, that is a pay check or 2. But if things go well the reward could be your money quadrupling or more.
- kgwgk 6y ago
  This applies to all Ponzi schemes. And despite the solid investment case most people end up holding the bag.
  - Calamity 6y ago
    It just non-stop amazes me. There might be some psychological defensive-bias at work here, but just in these replies to my original comment... it's predominantly pro-btc.
AznHisoka 6y ago
Putting money into Bitcoin is a rational decision because others are irrational and bidding it up.
- netrus 6y ago
  Isn't "putting money into Bitcoin" the same thing as "bidding it up"? Both actions have the same level of rationality, whatever that might be.
- paulryanrogers 6y ago
  While true there are other factors keeping some money out. Like those concerned with the environmental impact of the electricity generation and short lived ASICs.
- HarryHirsch 6y ago
  It's worrying, isn't it, people putting money into bitcoin because there are no productive investment opportunities available in the real world. That's secular stagnation.
  - thebean11 6y ago
    Wouldn't necessarily call bitcoin non-productive, any more than an unprofitable startup is non-productive. The technology does currently have niche use cases, and the decentralization can be a positive. It's a bet that "productive" things will be enabled by it.
    - HarryHirsch 6y ago
      One can make a good case for certain startups like Theranos or U-Beam to be the same type of non-productive investment as Bitcoin. Bitcoin exists only in the imagination, but some business models or products are just as imaginary because they are physically impossible. It's the same phenomenon, capital being thrown at things increasingly unlikely to yield a return.
- cratermoon 6y ago
shaolinspirit 6y ago
being rational is overrated, modernism is boring
- FabHK 6y ago
  Just for the record, I disagree with the first contention. And, boring is underrated.
tchalla 6y ago
Most situations aren’t black and white. Crypto (in particular Bitcoin) is an investment asset. Every asset comes with risks. The way to adjust for the risk is to have the right proportion of your investment into the asset. It’s the same for gold, equity or any other investment instrument.
- graeme 6y ago
  If there were no investor protections then anyone following this “just put a bit into different things” strategy would get hosed by scams. It only works because investment laws keep out most grifters from raising funds. Bitcoin isn’t a typical investment instrument in that sense, so I’m not sure applying the same heuristic works.
  - Calamity 6y ago
    Your comment actually embodies one of the most ironic parts of this whole fiasco: Bitcoin, which is purported as the anti-fed/anti-government savior of the future world economy (maybe I'm exaggerating a bit, but I don't think I'm too far off the mark), is ultimately going to serve as one of the best examples of exactly "why" we have regulation and oversight in the first place.
    - graeme 6y ago
      Kgwgk put it better than me I think, with their examples of diversification across bad asset classes. Also a thought occurs. Many people reading this will think “but these cynics are mistaken. Those who invested in bitcoin have seen massive returns”. Not so. The paper value of bitcoin is up, but unlike a stock, you don’t own anything. You need someone to actually buy the bitcoin in order to gain value. Whereas as long as a company has profits, there’s a floor on things. The shares will have real use value so the price can’t fall too low. Meaning buy bitcoin at $200, own now at $41,000. Only has value if you sell. If everyone tries to sell and no one is buying there’s no floor, none. Whereas bought Apple at $20, own at $132. The price could fall, but there’s some kind of floor below which it could not fall based on current profits and dividends, and that floor is almost certainly above $32.
pixel_tracing 6y ago
There’s money on the table what sane capitalist wouldn’t jump at the chance to take some in?
JumpCrisscross 6y ago
With income inequality the way it is, there is intense demand for lottery tickets. That brings the dumb money. And smart money tends to keep an eye on where the dumb money wanders. Disclosure: I think cryptos are this generation’s baseball cards. I have exposure to companies that make money trading cryptos and selling services to crypto investors.
- paulryanrogers 6y ago
  As someone who bought in the era of overproduced baseball cards I think this comparison is apt, if personally painful. At least I can burn them to cook and stay warm in an emergency.
  - Calamity 6y ago
    Yeh, well, that's what gets me the most about this. I can imagine the number of people jumping in on the bandwagon with money they can't afford to lose - and the pain that will inevitably ensue.
- Calamity 6y ago
  Smart move. They rake in the profits whether you're right or wrong. I've stock in something similar (plus500), but it makes an insignificant part of my overall portfolio. If you have a minute, feel free to PM a few that have caught your attention - the ideal would of course be something with valuation unaffected by the hype itself ;)
- mancerayder 6y ago
  You mentioned exposue to these companies; is that even possible without access to private equity?
  - thekyle 6y ago
    Both Square and PayPal are public and support "buying" of Crypto on their platforms. Coinbase is going to be IPOing soon into much fanfare.
Findeton 6y ago
Well if the FED and the ECB weren't printing tens of thousands of millions of fake money every month and calling it Quantitative Easing I might have agreed maybe. Truth is government issued money is worth less and less over time, as the scheme is designed to create inflation and thus make government debt sustainable by robbing everyone else's savings year by year.
- solinent 6y ago
  It seems to me the investment community has accepted bitcoin at this point, with major institutional investors finally buying in now--1 billion from microstrategy, for example--so expect to see it go up more. I think it will keep going up until it gets regulated, I'm sure they'll continue to find ways to "increase liquidity" despite Bitcoin.
- FabHK 6y ago
  > Truth is government issued money is worth less and less over time Yes, that's the deal with money, which incentivises you to either spend it or invest it in productive (unlike BTC) enterprises. As it happens, inflation has been very low, arguably too low in the last decade+.
  - deleted 6y ago
    [deleted]
elif 6y ago
If you are characterizing crypto as irrational or a thoughtless temptation, I have to imagine you are comparing it to traditional investments like stocks, bonds, etc. Maybe you are right there, maybe you aren't. Personally, I've done terrible at stocks and wonderful at crypto, so i disagree due to experiential knowledge. If you are comparing crypto to USD savings, it is quite obvious from a 10 year chart which one is irrational. Even if you completely write off the growth of crypto entirely, it is quite easy to beat negative value growth.
- xyzelement 6y ago
  A few thoughts: 1. It's not "easy" to beat negative value growth at baseline. EG: a risky investment that loses your entire investment is much worse. 2. If this was year 1999, could you have written exactly the same about .COM stocks shortly before they crashed and burned? If not, what is the thing you see about Crypto that makes that value feel real vs bubbly?
  - elif 6y ago
    Don't get me wrong, crypto is incredibly bubbly. It is physically stressful to keep up with at times. The bubbles are observable, though, and we have over a decade of time elapsed in order to show that in addition to bubbles (and full corrections!) on that basis of hype, there is an overall growth trend that results from the mathematical scarcity which .com shares lack. As far as comparison to a dotcom, they had to make payroll, nurture a profitable market, predict changes, outpace rivals etc. Many ways to suffer catastrophic death in that equation. whereas a bitcoin has no such requirement. All it has to do is not inflate too bad.
    - FabHK 6y ago
      > All it has to do is not inflate too bad. So, question: All the other coins, which are also strictly limited mathematically, they are also good long term investments, since they won't inflate too bad? They do all have "an overall growth trend that results from the mathematical scarcity", do they?

randomopining 6y ago

It’s a deflationary store of value, it does make sense to invest some into it.

FriendlyNormie 6y ago
Hello there, retard. Tell us what you’ve learned throughout all the research you’ve done on Tether. Oh, nothing? Kill yourself.
HarryHirsch 6y ago
store of value The value comes from being able to manipulate the price, one would suppose.
- fsdfgsfsdfsdfsd 6y ago
  How can you manipulate the price? I suppose there are now some whales, including governments that seized BTC from criminals, that could induce a crash by selling thousands of BTC within a short frame of time. But that may be true for many stocks as well.
- strathmeyer 6y ago
  The more dumb stuff people say about Bitcoin, the more room you know it has to rise.
  - paulryanrogers 6y ago
    Why is the comment dumb?
    - fsdfgsfsdfsdfsd 6y ago
      Because it is not so easy to manipulate the price, presumably. It depends on the trading volume. For many "altcoins" or "shitcoins" it may be true, because they have low trading volume. Bitcoin probably less so these days.
      - ricardo81 6y ago
        Given the market cap of 800 billion for BTC at the moment, presumably it should by relatively hard to manipulate. I'd read elsewhere that there was a tiny minority of BTC holders that own 95% of it, no idea of the authenticity of that. As a Layman, my assumption is the more liquidity in the market, the harder it would be to manipulate and less reason to dump onto the market if a large stakeholder.
        fsdfgsfsdfsdfsd 6y ago
        I think some of the whales could make the price tank, at least temporarily. They include some governments who seized thousands of BTC from criminal operations. But I think the same applies to many stocks. If Musk of Bezos would sell off a majority of their shares in their own companies, it would perhaps also move the price. At the moment, crashes in Bitcoin can also be seen as a good thing because it helps give more people access to Bitcoin. It's even possible that some of the stakeholders (whales with thousands of BTC) occasionally deliberately induce crashes for exactly that purpose.
xyzelement 6y ago
There's only so much that my dog can poop per day. Some of the poop gets lost when I scoop it off the sidewalk. And eventually he will die and not poop any more. Thus my dog's turds are a deflationary store of value but I wouldn't say "it makes sense to invest in some." Disclosure - I made up the dog.
- thebean11 6y ago
  The dismissiveness of (presumably) otherwise thoughtful people on this forum still surprises me. Do you really find that comparison valuable in evaluating the tech?
  - xyzelement 6y ago
    I was looking to make a finance, not tech point. Specifically that there are many things that are finite and "deflationary" but obviously without value. Point being that the scarcity argument of bitcoin is on its own not persuasive. I used the cheeky example of dog poop because I though it was cute but I guess it was"too cute" and obscured the point.
    - Calamity 6y ago
      I think your point was made and those who are actually listening have understood it ;) I think your analogy does a good job in conveying the point that deflationary =/= valuable. Almost ironically, having a deflationary system is something one would really like to avoid if you thought about it. It only rewards hoarding. The king, with his hoard of gold, only grow's richer by the year. As long as he is cash flow positive, the supply upon which the peasants rely on to trade shrinks and therefore the value of each grain increases. I, for one, don't think this system is one we should be rushing to return to.
      - jcpham2 6y ago
        Don’t confuse deflationary with the lack of fungibility. No physical currency can be divided into 10 million pieces, no one has a crystal ball.

14 6y ago

I think it is a high risk high reward system. For some there is very little risk in investing several thousand dollars, that is a pay check or 2. But if things go well the reward could be your money quadrupling or more.

kgwgk 6y ago
This applies to all Ponzi schemes. And despite the solid investment case most people end up holding the bag.
- Calamity 6y ago
  It just non-stop amazes me. There might be some psychological defensive-bias at work here, but just in these replies to my original comment... it's predominantly pro-btc.

AznHisoka 6y ago

Putting money into Bitcoin is a rational decision because others are irrational and bidding it up.

netrus 6y ago
Isn't "putting money into Bitcoin" the same thing as "bidding it up"? Both actions have the same level of rationality, whatever that might be.
paulryanrogers 6y ago
While true there are other factors keeping some money out. Like those concerned with the environmental impact of the electricity generation and short lived ASICs.
HarryHirsch 6y ago
It's worrying, isn't it, people putting money into bitcoin because there are no productive investment opportunities available in the real world. That's secular stagnation.
- thebean11 6y ago
  Wouldn't necessarily call bitcoin non-productive, any more than an unprofitable startup is non-productive. The technology does currently have niche use cases, and the decentralization can be a positive. It's a bet that "productive" things will be enabled by it.
  - HarryHirsch 6y ago
    One can make a good case for certain startups like Theranos or U-Beam to be the same type of non-productive investment as Bitcoin. Bitcoin exists only in the imagination, but some business models or products are just as imaginary because they are physically impossible. It's the same phenomenon, capital being thrown at things increasingly unlikely to yield a return.
cratermoon 6y ago

shaolinspirit 6y ago

being rational is overrated, modernism is boring

FabHK 6y ago
Just for the record, I disagree with the first contention. And, boring is underrated.

tchalla 6y ago

Most situations aren’t black and white. Crypto (in particular Bitcoin) is an investment asset. Every asset comes with risks. The way to adjust for the risk is to have the right proportion of your investment into the asset. It’s the same for gold, equity or any other investment instrument.

graeme 6y ago
If there were no investor protections then anyone following this “just put a bit into different things” strategy would get hosed by scams. It only works because investment laws keep out most grifters from raising funds. Bitcoin isn’t a typical investment instrument in that sense, so I’m not sure applying the same heuristic works.
- Calamity 6y ago
  Your comment actually embodies one of the most ironic parts of this whole fiasco: Bitcoin, which is purported as the anti-fed/anti-government savior of the future world economy (maybe I'm exaggerating a bit, but I don't think I'm too far off the mark), is ultimately going to serve as one of the best examples of exactly "why" we have regulation and oversight in the first place.
  - graeme 6y ago
    Kgwgk put it better than me I think, with their examples of diversification across bad asset classes. Also a thought occurs. Many people reading this will think “but these cynics are mistaken. Those who invested in bitcoin have seen massive returns”. Not so. The paper value of bitcoin is up, but unlike a stock, you don’t own anything. You need someone to actually buy the bitcoin in order to gain value. Whereas as long as a company has profits, there’s a floor on things. The shares will have real use value so the price can’t fall too low. Meaning buy bitcoin at $200, own now at $41,000. Only has value if you sell. If everyone tries to sell and no one is buying there’s no floor, none. Whereas bought Apple at $20, own at $132. The price could fall, but there’s some kind of floor below which it could not fall based on current profits and dividends, and that floor is almost certainly above $32.

pixel_tracing 6y ago

There’s money on the table what sane capitalist wouldn’t jump at the chance to take some in?

JumpCrisscross 6y ago

With income inequality the way it is, there is intense demand for lottery tickets. That brings the dumb money. And smart money tends to keep an eye on where the dumb money wanders. Disclosure: I think cryptos are this generation’s baseball cards. I have exposure to companies that make money trading cryptos and selling services to crypto investors.

paulryanrogers 6y ago
As someone who bought in the era of overproduced baseball cards I think this comparison is apt, if personally painful. At least I can burn them to cook and stay warm in an emergency.
- Calamity 6y ago
  Yeh, well, that's what gets me the most about this. I can imagine the number of people jumping in on the bandwagon with money they can't afford to lose - and the pain that will inevitably ensue.
Calamity 6y ago
Smart move. They rake in the profits whether you're right or wrong. I've stock in something similar (plus500), but it makes an insignificant part of my overall portfolio. If you have a minute, feel free to PM a few that have caught your attention - the ideal would of course be something with valuation unaffected by the hype itself ;)
mancerayder 6y ago
You mentioned exposue to these companies; is that even possible without access to private equity?
- thekyle 6y ago
  Both Square and PayPal are public and support "buying" of Crypto on their platforms. Coinbase is going to be IPOing soon into much fanfare.

Findeton 6y ago

Well if the FED and the ECB weren't printing tens of thousands of millions of fake money every month and calling it Quantitative Easing I might have agreed maybe. Truth is government issued money is worth less and less over time, as the scheme is designed to create inflation and thus make government debt sustainable by robbing everyone else's savings year by year.

solinent 6y ago
It seems to me the investment community has accepted bitcoin at this point, with major institutional investors finally buying in now--1 billion from microstrategy, for example--so expect to see it go up more. I think it will keep going up until it gets regulated, I'm sure they'll continue to find ways to "increase liquidity" despite Bitcoin.
FabHK 6y ago
> Truth is government issued money is worth less and less over time Yes, that's the deal with money, which incentivises you to either spend it or invest it in productive (unlike BTC) enterprises. As it happens, inflation has been very low, arguably too low in the last decade+.
- deleted 6y ago
  [deleted]

elif 6y ago

If you are characterizing crypto as irrational or a thoughtless temptation, I have to imagine you are comparing it to traditional investments like stocks, bonds, etc. Maybe you are right there, maybe you aren't. Personally, I've done terrible at stocks and wonderful at crypto, so i disagree due to experiential knowledge. If you are comparing crypto to USD savings, it is quite obvious from a 10 year chart which one is irrational. Even if you completely write off the growth of crypto entirely, it is quite easy to beat negative value growth.

xyzelement 6y ago
A few thoughts: 1. It's not "easy" to beat negative value growth at baseline. EG: a risky investment that loses your entire investment is much worse. 2. If this was year 1999, could you have written exactly the same about .COM stocks shortly before they crashed and burned? If not, what is the thing you see about Crypto that makes that value feel real vs bubbly?
- elif 6y ago
  Don't get me wrong, crypto is incredibly bubbly. It is physically stressful to keep up with at times. The bubbles are observable, though, and we have over a decade of time elapsed in order to show that in addition to bubbles (and full corrections!) on that basis of hype, there is an overall growth trend that results from the mathematical scarcity which .com shares lack. As far as comparison to a dotcom, they had to make payroll, nurture a profitable market, predict changes, outpace rivals etc. Many ways to suffer catastrophic death in that equation. whereas a bitcoin has no such requirement. All it has to do is not inflate too bad.
  - FabHK 6y ago
    > All it has to do is not inflate too bad. So, question: All the other coins, which are also strictly limited mathematically, they are also good long term investments, since they won't inflate too bad? They do all have "an overall growth trend that results from the mathematical scarcity", do they?