8 ms·

Everything is inflated and has been bid up. Cryptos are certainly no exception, it's only gotten worse in the last two years with all the FOMO they fostered and

by BbzzbB 5y ago

Everything is inflated and has been bid up. Cryptos are certainly no exception, it's only gotten worse in the last two years with all the FOMO they fostered and salesman that gathered to profit off my disillusioned generation. To each their own, but I think the idea that TINA to crypto is plain silly, yet I know more people (am millennial) owning crypto than stocks, always with this notion that TINA. At least with stocks you're still entitled to legal ownership of cashflows, with cryptocurrencies today you merely get a late entrance ticket to a digital commodity that might have monetary value, but trades like just another risk-on asset. The S&P500 will always look like a 90 degree angle on a long enough timeline, that's just how exponentials work. And it is by definition exponential as earnings compound, a quality cryptos do not possess. But it is ironic to hold that against it when 5-year charts in the crypto world look as they do. Time will tell which way it resolves I guess.

5350-uiop-1130 5y ago
yes, crypto is inflated, and a pump and dump, but there is opportunity there, and hope. and that is what most retail are buying. i mean something changed in the stock market after 2008. i'm not really educated enough in finance, but it seems the value of stocks just went vertical. and since the covid pandemic everything has doubled in value. i know its related to decrease in value of usd but since my salary doesnt even increase to match inflation so its the same both ways. if i invest in stocks, at best i will get 2x after 5 years, at worst i will be buying at the peak of the everything bubble.
- BbzzbB 5y ago
  FWIW, my point isn't that crypto is doomed and entirely useless - I have a more nuanced opinion (tho no position) but that's not why I'm commenting. I also don't mean to be giving advice to anyway, just sharing opinions while it's on topic. My point is that a whole damn lot of my age group peers have drunk the Kool-Aid that crypto is the only game in town and that there is no alternative, which is silly to be respectful, and foolish to be less so. No one rational would argue there is no opportunity there, there's tremendous trading opportunity in any market and it only goes up (as well as the risk) the more volatile and unregulated it is. There's also tremendous opportunity to make money in the Turkish market, Russian ones these days I bet will mint millionaires. That doesn't say anything regarding if it's a good idea or not to partake, let alone to buy, pray and hodl. >that is what most retail are buying. That kills your opportunity, going to the crowded asset isn't exactly good for you, it just increases your cost basis and reduces your earnings or dividend yield (not that you get one with most cryptos). It's good if you're trading and have an edge in that game tho, but that's not what people I know do when they buy crypto for the long haul or gamble for the short term. >if i invest in stocks, at best i will get 2x after 5 years, at worst i will be buying at the peak of the everything bubble That seems to be the general theme. Pessimistic outlook on the best case for stock with an optimistic outlook for the best case in crypto while ignoring it's worst case. Also while ignoring the monumental amount of fraud and open scheming in crypto (CC: all the influencers and their literally worthless NFTs, the rugs, the thefts, the bot-phishing), doesn't exactly scream "rational, not a bubble market". Why not realistically looking about the worst case for both rather than focus on the best case for one? For crypto it's possibly getting offramps rugged by governments or even simply the market changing it's mind - with no intrinsic value there's basically no floor. In both cases you get wiped entirely. For stocks there'll always be a floor as they represent stakes in the actual economy, real companies with real balance and earnings sheet. Worst case historically is a -90%, but that went with the great depression and famine, you'll have bigger worries. A 2008 style historic crisis is a mere -50%. I think owning crypto makes sense, but I can't understand the rationale behind being all-in crypto with significant life savings which I see a lot. If it's really gonna overtake the entire fiat system, you'll be just fine even without risking to lose everything you own in the even it's a dud and doesn't overtake the financial system.
d13 5y ago
Ethereum has revenue 1b per month - and that’s 100% profit. It’s highly undervalued at the moment.
- BbzzbB 5y ago
  You mean miner fees? How's that a 100% margin after hardware and electricity? Sure if the network transfers to a PoS/ETH2 model those operating costs go down, but so will transaction fees, hence revenue, with the planned sharding, transaction wrapping/bundling (I'm forgetting the terminology here) and burning, no? It also seems necessary to gut those transaction costs if ETH wants to be useful. Even then, that staking model isn't exactly costless either for nodes, they do have to freeze assets therefore giving it opportunity cost and making their goods highly illiquid. I'd add, if your revenue figure is right, 12B profit (let's be generous) isn't exactly something to drool about on a 250B base. A 5% yield is of course fine if sustainable, arguably high end (in line with sectors like oil, but below sin sectors and specific stocks), but I'd bet 5% is not the sort of returns the crypto crowd is aiming for, not even close. There are safer ways to earn 5%.

by BbzzbB 5y ago

5350-uiop-1130 5y ago

yes, crypto is inflated, and a pump and dump, but there is opportunity there, and hope. and that is what most retail are buying. i mean something changed in the stock market after 2008. i'm not really educated enough in finance, but it seems the value of stocks just went vertical. and since the covid pandemic everything has doubled in value. i know its related to decrease in value of usd but since my salary doesnt even increase to match inflation so its the same both ways. if i invest in stocks, at best i will get 2x after 5 years, at worst i will be buying at the peak of the everything bubble.

BbzzbB 5y ago
FWIW, my point isn't that crypto is doomed and entirely useless - I have a more nuanced opinion (tho no position) but that's not why I'm commenting. I also don't mean to be giving advice to anyway, just sharing opinions while it's on topic. My point is that a whole damn lot of my age group peers have drunk the Kool-Aid that crypto is the only game in town and that there is no alternative, which is silly to be respectful, and foolish to be less so. No one rational would argue there is no opportunity there, there's tremendous trading opportunity in any market and it only goes up (as well as the risk) the more volatile and unregulated it is. There's also tremendous opportunity to make money in the Turkish market, Russian ones these days I bet will mint millionaires. That doesn't say anything regarding if it's a good idea or not to partake, let alone to buy, pray and hodl. >that is what most retail are buying. That kills your opportunity, going to the crowded asset isn't exactly good for you, it just increases your cost basis and reduces your earnings or dividend yield (not that you get one with most cryptos). It's good if you're trading and have an edge in that game tho, but that's not what people I know do when they buy crypto for the long haul or gamble for the short term. >if i invest in stocks, at best i will get 2x after 5 years, at worst i will be buying at the peak of the everything bubble That seems to be the general theme. Pessimistic outlook on the best case for stock with an optimistic outlook for the best case in crypto while ignoring it's worst case. Also while ignoring the monumental amount of fraud and open scheming in crypto (CC: all the influencers and their literally worthless NFTs, the rugs, the thefts, the bot-phishing), doesn't exactly scream "rational, not a bubble market". Why not realistically looking about the worst case for both rather than focus on the best case for one? For crypto it's possibly getting offramps rugged by governments or even simply the market changing it's mind - with no intrinsic value there's basically no floor. In both cases you get wiped entirely. For stocks there'll always be a floor as they represent stakes in the actual economy, real companies with real balance and earnings sheet. Worst case historically is a -90%, but that went with the great depression and famine, you'll have bigger worries. A 2008 style historic crisis is a mere -50%. I think owning crypto makes sense, but I can't understand the rationale behind being all-in crypto with significant life savings which I see a lot. If it's really gonna overtake the entire fiat system, you'll be just fine even without risking to lose everything you own in the even it's a dud and doesn't overtake the financial system.

d13 5y ago

Ethereum has revenue 1b per month - and that’s 100% profit. It’s highly undervalued at the moment.

BbzzbB 5y ago
You mean miner fees? How's that a 100% margin after hardware and electricity? Sure if the network transfers to a PoS/ETH2 model those operating costs go down, but so will transaction fees, hence revenue, with the planned sharding, transaction wrapping/bundling (I'm forgetting the terminology here) and burning, no? It also seems necessary to gut those transaction costs if ETH wants to be useful. Even then, that staking model isn't exactly costless either for nodes, they do have to freeze assets therefore giving it opportunity cost and making their goods highly illiquid. I'd add, if your revenue figure is right, 12B profit (let's be generous) isn't exactly something to drool about on a 250B base. A 5% yield is of course fine if sustainable, arguably high end (in line with sectors like oil, but below sin sectors and specific stocks), but I'd bet 5% is not the sort of returns the crypto crowd is aiming for, not even close. There are safer ways to earn 5%.