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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
"Buying tulips is a rational decision because others are irrational and bidding them up"
- AznHisoka 6y ago
  Substitute bitcoin for whatever you want: tulips, Beanie babies, etc. Even George Soros, the legendary investor is in favor of putting money in a bubble early on. It's how you make the most money.
  - cratermoon 6y ago
    It's also how you lose most often. It's a gamble for rich people who have money they can afford to write off. It's not a sound retirement investment.
xyzelement 6y ago
>> Putting money into Bitcoin is a rational decision because others are irrational and bidding it up. It all comes down to: investing is great if you buy low and sell high. Let's just say this - if you aren't able to imagine the scenario under which your BTC (or any investment) crashes down to near zero, you're just not thinking well enough. I can conjure up a disaster scenario just standing right now in my kitchen, and I don't even own crypto.
- BeetleB 6y ago
  > I can conjure up a disaster scenario just standing right now in my kitchen, and I don't even own crypto. Even if Bitcoin goes to zero, many who hold BTC when it hits zero will still have made a profit out of it.
  - xyzelement 6y ago
    I suppose you mean "because they had sold a bit of it before" - sure. And someone else has bought it off them and will have lost.
    - BeetleB 6y ago
      > And someone else has bought it off them and will have lost. Not the concern of the one making a profit off of this. Not sure it should be either. That's the role of the regulators.
      - xyzelement 6y ago
        I am not making a moral argument. I am talking about the disaster scenario. I guess I agree with your point actually - if someone got to a place where they already got more $USD out of bitcoin than they invested, it's safe to play.
  - nmfisher 6y ago
    Yeah, but if BTC goes to zero, it's more relevant to ask "for every 100 investors who ever bought BTC, how many made a net profit and how many made a net loss"?

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

"Buying tulips is a rational decision because others are irrational and bidding them up"

AznHisoka 6y ago
Substitute bitcoin for whatever you want: tulips, Beanie babies, etc. Even George Soros, the legendary investor is in favor of putting money in a bubble early on. It's how you make the most money.
- cratermoon 6y ago
  It's also how you lose most often. It's a gamble for rich people who have money they can afford to write off. It's not a sound retirement investment.

xyzelement 6y ago

>> Putting money into Bitcoin is a rational decision because others are irrational and bidding it up. It all comes down to: investing is great if you buy low and sell high. Let's just say this - if you aren't able to imagine the scenario under which your BTC (or any investment) crashes down to near zero, you're just not thinking well enough. I can conjure up a disaster scenario just standing right now in my kitchen, and I don't even own crypto.

BeetleB 6y ago
> I can conjure up a disaster scenario just standing right now in my kitchen, and I don't even own crypto. Even if Bitcoin goes to zero, many who hold BTC when it hits zero will still have made a profit out of it.
- xyzelement 6y ago
  I suppose you mean "because they had sold a bit of it before" - sure. And someone else has bought it off them and will have lost.
  - BeetleB 6y ago
    > And someone else has bought it off them and will have lost. Not the concern of the one making a profit off of this. Not sure it should be either. That's the role of the regulators.
    - xyzelement 6y ago
      I am not making a moral argument. I am talking about the disaster scenario. I guess I agree with your point actually - if someone got to a place where they already got more $USD out of bitcoin than they invested, it's safe to play.
- nmfisher 6y ago
  Yeah, but if BTC goes to zero, it's more relevant to ask "for every 100 investors who ever bought BTC, how many made a net profit and how many made a net loss"?