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No? Stocks are backed by business activity but crypto is pure ponzi scheme speculation where the only way to get rich is to sell to a bigger loser.

• cryptica 5y ago
  Stocks pretend to be backed by real business activity. Without being propped up by central banks, there is no guarantee they would be profitable. They might be destroying value, not creating it.
  • JKCalhoun 5y ago
    Whether you agree or disagree, the Feds tend to step in when the stock market drops — not so crypto.
    • deleted 5y ago
      [deleted]
  • jfengel 5y ago
    Quantitative easing has made stocks more profitable than they really should be, perhaps by a factor of two or three (as measured by the ratio of stock price to profits). But there actually is an underlying value there, and in the long term it tends to revert closer to that mean. It does seem overpriced right now and overdue for a correction, though it can remain irrational longer than you can remain solvent. Still, don't confuse the real merit with the hype. They both exist. It's less clear whether that exists at all for crypto.
    • chrisco255 5y ago
      It definitely exists for crypto. See what protocols are earning money here: https://cryptofees.info/ https://cryptofees.info/
  • Closi 5y ago
    > Stocks pretend to be backed by real business activity Stocks are backed by real business activity. Can you name a successful major publicly-traded company (currently) which is actually just fictional business activity? (The finance industry might be the debatable exception depending on the definition of 'real' business activity). Once shareholders find out that a business is actually just "pretend" business activity it's value tends to drop through the floor. See: Enron, Theranos, e.t.c.
    • cryptica 5y ago
      Maybe Google is. I remember a time over a decade ago (before the insane 0% monetary policy started) when they were struggling to turn a profit. The business model did not change much since then and yet now they are profitable. It's possible that without this monetary stimulus, they would be unprofitable... Meaning destroying value; if that's the case then we can say thay Google is running a fictional business since it can only exist in this highly artificial monetary environment where it's receiving special treatment due to its ability to hoard eyeballs. Who is to say that hoarding user attention and online advertising is actually profitable? In a real monetary system where the money supply isn't in a constant state of rapid expansion.
      • Closi 5y ago
        Google generates 180 billion in revenue, 140 billion of which comes from ads. None of this revenue is a government subsidy. > I remember a time over a decade ago (before the insane 0% monetary policy started) when they were struggling to turn a profit Well they have been profitable since 3 years after incorporation, so we are talking over 20 years ago. > The business model did not change much since then and yet now they are profitable. Well the industry, their market share, the number of clients and the number of ads served grew, and they refined their business model throughout. > Who is to say that hoarding user attention and online advertising is actually profitable? Google, based on the excess profits they have generated across the last 20 years to become one of the most valuable companies in the world. > where it's receiving special treatment due to its ability to hoard eyeballs. In economics that's called a competitive advantage :) It's not a coincidence that it gets eyeballs, it's part of their whole business model.
• logicalmonster 5y ago
  Stocks are only moderately backed by business activity. Much of the short and medium term price action you’ll see other than general large scale long term trends is heavily manipulated. And naked short selling exists on a disgustingly wide scale. Imagine thinking that reasonable market pricing can exist in a situation where shares can be fabricated at will. To be objective, crypto is largely treated by most people as a speculative asset today and its price action is also heavily manipulated. The one big difference is that at least you can mathematically verify how many units of crypto exist and there’s some measure of transparency that doesn’t exist in the stock market. Despite centuries of supposed regulation and improvements the stock market is a crooked system where you don’t even have a clear picture of how many real shares are even floating about the marketplace. Think about that for a bit and compare that situation to crypto where any transaction can be verified. But in general I’d argue that crypto is still so new that even smart people don’t really have an understanding of what it is yet. It’s not a speculative currency or ponzu scheme, at its core it’s a technology platform with many attributes that other systems devised by humans don’t yet have such as being trustless which is going to allow all kinds of new and previously impossible technology systems to exist.