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You're talking about MVRV (Market Value to Realized Value). If it's below 1, it means the average investor is carrying a loss, and > 1 means carrying profit. Hi

You're talking about MVRV (Market Value to Realized Value). If it's below 1, it means the average investor is carrying a loss, and > 1 means carrying profit. Historically every halving it has spent some time below 1, and we are right on schedule. https://charts.woobull.com/bitcoin-mvrv-ratio/ https://charts.woobull.com/bitcoin-mvrv-ratio/

yunohn 4y ago
Crypto (esp BTC) is a well defined zero or negative sum game. How do you propose /most/ people make a profit?
- throwup 4y ago
  I didn't propose that. I just linked a relevant indicator. If you'd like me to predict the future, I predict that eventually BTC will fill a similar niche as gold - it will outperform cash under the mattress, but underperform index funds. You'll be able to spot the transition when the MVRV starts to center around 1.0 instead of its current ~1.5. But I couldn't begin to guess when that will happen. Maybe this crash is the catalyst, or maybe it will happen a decade from now. ¯\_(ツ)_/¯
- ptudan 4y ago
  Please elaborate, how is it a negative sum game?
  - librish 4y ago
    For every person taking money out someone else has to put money in (which would be zero-sum) plus the miners taking their cut.
    - doorman2 4y ago
      By that definition, which financial instruments aren't negative sum? E.g. stocks trade hands in a very similar way, and companies can always issue new shares.
      - dragontamer 4y ago
        Company sells stock. The money builds a new factory. Or in the case of Google, a data center, or other such item that allows the company to make more money. Later, when the company is worth more, the shareholder sells the stock back and/or gets a dividend (aka, a slice of the profits). Everyone wins. -------- In contrast, the BTC you bought was likely made using stolen electricity. So we're already negative sum to the start.
        doorman2 4y ago
        The same thing could happen with crypto. A smart contract developer sells crypto to fund development of a smart contract. That smart contract can provide new utility and drive demand for the currency.

yunohn 4y ago

Crypto (esp BTC) is a well defined zero or negative sum game. How do you propose /most/ people make a profit?

throwup 4y ago
I didn't propose that. I just linked a relevant indicator. If you'd like me to predict the future, I predict that eventually BTC will fill a similar niche as gold - it will outperform cash under the mattress, but underperform index funds. You'll be able to spot the transition when the MVRV starts to center around 1.0 instead of its current ~1.5. But I couldn't begin to guess when that will happen. Maybe this crash is the catalyst, or maybe it will happen a decade from now. ¯\_(ツ)_/¯
ptudan 4y ago
Please elaborate, how is it a negative sum game?
- librish 4y ago
  For every person taking money out someone else has to put money in (which would be zero-sum) plus the miners taking their cut.
  - doorman2 4y ago
    By that definition, which financial instruments aren't negative sum? E.g. stocks trade hands in a very similar way, and companies can always issue new shares.
    - dragontamer 4y ago
      Company sells stock. The money builds a new factory. Or in the case of Google, a data center, or other such item that allows the company to make more money. Later, when the company is worth more, the shareholder sells the stock back and/or gets a dividend (aka, a slice of the profits). Everyone wins. -------- In contrast, the BTC you bought was likely made using stolen electricity. So we're already negative sum to the start.
      - doorman2 4y ago
        The same thing could happen with crypto. A smart contract developer sells crypto to fund development of a smart contract. That smart contract can provide new utility and drive demand for the currency.