Bitcoin

Actually Winky - we do agree much more than it seemed at first glance - I wasn't so much trying to cherry pick a time line - I just felt like 15 years was a decent "recent" time line, and where we do disagree is that I think PMs will go much higher from here...priced in fiat currency terms. That is the interesting thing about gold - throughout history it is a "currency" (or as some say, "real money") that has maintained pretty steady and stable buying power for thousands of years, with fluctuations of course.

People who think gold will make them rich are kidding themselves (the gold bugs) because the "value" is priced in terms of the government fiat currencies. As I said, I view it literally as n insurance policy, because in the event of currency collapse I feel reasonably certain gold will still have a place at the table in the new fiat. (Not guaranteed, but 5,000 years of history speaks to that being the case more likely than not.) It might provide some seed funds to start life over.

I agree that productive businesses, real estate, and farmland (which is part of both of those categories) are good (even the best) investment classes. Because they are things that are useful and will always be in demand. The only advantage gold might be considered having over those is its relative portability...but then, I don't see it as an investment or speculation, just an insurance policy.

Cryptos? Who knows, but to me it is a highly speculative thing regardless. I'd like some exposure, but only in a very small way since I don't really "get it"...very much like gambling in my mind.

Huge posted:

Simon, I agree that there's no point in trying to exploit vulnerabilities in the maths of the current generation of asymmetric entropic encryption schemes, but that's not where you target the attack - you look for vulnerabilities in the supporting structures.  Previously In my design role I was frequently having to remind people of this.

Indeed as in anything - but that is a constant as it were and nothing to do with Crypto currencies per se. I find it fascinating that a small JSON file containing my private key and few other crypto pieces so as to  access  my money which I can keep locked away - and even that is protected by a secret private  key that I only know unless I want to share with multiple keys- but the 'money' itself  is distributed across the planet in the validated global block chains - I love the technology and mathematics of it all - and it is so easy to have multiple accounts such as pay in or mining accounts that can then feed weekly into your master off line or cold account.... one thing for sure it  is quite volatile at the moment with the price ticking up and down a few percentage points each day - I guess you need to look into the trend to work out the 'interest' which probably has been unsustainably high over the last 6 months at about 700% [with Ethereum] - and hindsight is a wonderful thing . The other concept I like with Ethereum is the 'gas' or transaction charge - and the quicker you need the transaction validated and confirmed the more global computing resources are uses so the higher the cot. I leave mine at the default responsiveness of about 15 pence per transaction.

And I think Mark has it - treat it speculatively - use it to pay for some items - kind of novelty style - but for the most part use it to save small amounts gambling the interest. Its almost as fun as going to the races - but somewhat more fruitful currently... 

DrMark posted:

Actually Winky - we do agree much more than it seemed at first glance - I wasn't so much trying to cherry pick a time line - I just felt like 15 years was a decent "recent" time line, and where we do disagree is that I think PMs will go much higher from here...priced in fiat currency terms. That is the interesting thing about gold - throughout history it is a "currency" (or as some say, "real money") that has maintained pretty steady and stable buying power for thousands of years, with fluctuations of course.

People who think gold will make them rich are kidding themselves (the gold bugs) because the "value" is priced in terms of the government fiat currencies. As I said, I view it literally as n insurance policy, because in the event of currency collapse I feel reasonably certain gold will still have a place at the table in the new fiat. (Not guaranteed, but 5,000 years of history speaks to that being the case more likely than not.) It might provide some seed funds to start life over.

I agree that productive businesses, real estate, and farmland (which is part of both of those categories) are good (even the best) investment classes. Because they are things that are useful and will always be in demand. The only advantage gold might be considered having over those is its relative portability...but then, I don't see it as an investment or speculation, just an insurance policy.

Cryptos? Who knows, but to me it is a highly speculative thing regardless. I'd like some exposure, but only in a very small way since I don't really "get it"...very much like gambling in my mind.

I think we do agree. My point was really that gold as an "investment" is pretty hopeless on average. It's better than putting cash in your mattress, for sure, but not even as good as "risk free" bonds. And certainly nowhere near as good any other mainstream investment category in the long-term.

I'd suggest that it is (ultimately) a mistake to invest in things you don't understand - especially things which have no intrinsic value.

On my other hand - you can make money buying any old shit as it rises and getting the hell out before the bubble bursts. I just don't find that a very attractive way of making money.

As Richard Feynman didn't say about Bitcoin (applies to money to be frank) "If you think you understand (quantum mechanics) Bitcoin, you don't understand (quantum mechanics) Bitcoin."

Additionally - Richard Feynman, the late Nobel Laureate in physics, was once asked by a Caltech faculty member to explain why spin one-half particles obey Fermi Dirac statistics. Rising to the challenge, he said, "I'll prepare a freshman lecture on it."

But a few days later he told the faculty member, "You know, I couldn't do it. I couldn't reduce it to the freshman level. That means we really don't understand it."

 

Frank

winkyincanada posted:
DrMark posted:
winkyincanada posted:
Kevin Richardson posted:

 I was a hardcore gold bug starting in 2001-2 but I've lost all interest in PM's outside of a small "sentimental" position. 

 

While I don't speculate on intrinsically worthless things like PMs or Bitcoin, I applaud your decision to get out of this space. Holding gold has been (and will continue to be) a terrible, terrible strategy over any reasonable time period.

And fiat currencies are not "intrinsically worthless" things? Gold has a 5,000 year record of value. Name one fiat currency in the history of world finance that has been successful for more than 300 years. The USD will eventually find its intrinsic value. Ditto the Euro, and all the others. Then the SDRs will show up, and the banks will take care of themselves. They always do.

$305 an ounce ca. 2002, and just shy of $1,300 today. That's a double every 3 years on average...so I fail to see how that "has been a terrible strategy" - and no, I didn't own any gold in that time period, so I was not in that game. Had you sold out anywhere near the $1,600 - $1,800 top a few years back, it would have returned ~650% in about 10 years.

But it really is not an investment, nor should it be treated as such. It is crisis and reset insurance, nothing more. Being a "gold bug" is a pointless endeavor. Use miners and royalty companies as speculative vehicles because they tend to front-run and increase more than the value of the PMs - mining itself is a TERRIBLE business.

As Alan Greenspan recently said in a recent interview, after saying generally negative things about gold...he was asked "Do you own any gold?" His response: "Of course...I'm not stupid."

Central banks are loading up on gold these days, despite nay-saying it consistently. And the only reason the price is where it is, is because the paper gold market (i.e., funds like GLD) allow it to be one of the most manipulated markets around. If people with the contracts ever demand their physical product, there is nowhere near enough to sate those requests.

And cryptos may (or may not) end up being alternatives to PMs and fiat currencies - only time will tell.

You're cherry-picking your timeline.

From 1913 to the present day gold, in inflation-adjusted terms has provided a CAGR of just 0.87% per year. If inflation is added the CAGR is just 4%. It's been a much worse investment the US bonds. If the returns are considered in the light of the volatility, then they are really dismal. All the risk and no reward. Of course, some gold bugs argue that the gold price is negatively correlated to their other investments and therefore should be a part of a risk managed portfolio as a hedge against bad things happening. Their is some evidence to support this notion, I'll admit. 

We're not disagreeing in general. Currencies are simply promises made by one party to another to provide something of tangible value in the future. They're all risky to a greater or lesser extent in that regard, and I don't speculate on their movement in price. My investments are in tangible things such as companies and real-estate, (albeit all priced by way of regular currencies). I count gold primarily as a currency as the stored amount of gold vastly exceeds it's usage for real applications (plating audio connectors for example). It's price is largely reflection the market's view of its future price, and is essentially disconnected from the cost of production via mining/processing/smelting/refining process by the vast buffer of stockpiled gold. (The notion that the amount gold named in derivatives vastly exceeds the stored amount is true, but disingenuous. In the case of the derivatives there are always counter-parties and it all just nets off or defaults to zero. Adds to volatility but not to long-term price growth.)

Correction to my timeline. I meant to write 1913!

Kevin Richardson posted:
TOBYJUG posted:

Apparently it produces a massive amount of CO2 gases to mine Bitcoins.

Those poor countries that are exploited for those precious minerals they add to make it more shinier.

its atrocious.

It is the world's most powerful single purpose super computer.

Shouldn't it get a proper job?

count.d posted:
Kevin Richardson posted:

Pre August 1,2017 Bitcoin passed $5,000 USD today.

How come you didn't post here on Tuesday when you lost $600,000? 

Not sure I follow that comment, Bitcoin as at 10.40 BST is worth £162.44 per Bitcoin more than it was precisely this time a week ago.

If you invest in crypto currencies unless you want to play with trading algorithms you really need to do for the longer term and diversify the currencies in my opinion... and even most trading algorithms seem to only really yieldresults over a longer term.. say several weeks and months. Thanks to the cue from Kevin I now again have a modest investment in cryptos and so far so good....

Kevin boasted (yes, unprovoked boast) on 16th that his wealth had escalated to over $2.8m. The price was $4,400 then. The price dropped on Tuesday to $3,740. that's a 15% drop. I'd like to hear the ups and downs, not just the boasts. Also, if someone loses $600,000 in 6 days, I don't think he's doing a good job, he's lucky and unlucky, as I stated in my second post on this thread.

Got you... yes they price can move up and down a fair bit in a week... hence why I am trying to average over the week. Although I don't save Bitcoin, I have just pulled the chart from my tracker, and indeed there was a sharp trough on Tuesday to which the price bounced back, and also a peak on Friday to which the price has fallen back... if you draw a straight line over the week however it's a steady rise..

Kevin Richardson posted:
Also, I have no access to 98% of my bitcoins ....

Similarly, my unicorns greet any attempt on my part to monetise them with "Take your stinking paws off me, you damn dirty ape!".

Which explains why they are presently entrusted to soft hands of the Virgins of Radnok.

I love disruptive mythologies.

Obviously - you will have the last laugh. Which won't 't stop me chortling for the next 50-100 years.

" As for the boast... It's $3.8 million not $2.8 million.. Not that +/- a million $ will matter in 10 years"

Kevin, the $600,000 loss is correct, I typed $2.8 instead of $3.8 here. You should have instantly understood the discrepancy. Perhaps your generations would appreciate the odd $600,000 now, instead of waiting until they're 103 for the big surprise.

You don't know it will grow over the next 10 years or 10 days, this is my point. If you knew, you wouldn't lose 15%. You're the one who boasted a value increase over days, I'm addressing that issue. It doesn't make me feel better whether the price goes up or down for you. I thought the thread started off with a potential to be interesting, but ended just being a platform to boast your wealth. I don't understand the logic behind your investing, I don't understand Bitcoins and tbh, I don't understand investing for 100 years time. Best of luck anyway. 

Bragging or boasting a side, I find crypto currencies a fascinating technology, and I suspect a possible vignette of future currencies and monetary transaction frameworks... certainly getting involved with them is fascinating if you are that way inclined... they appear are very much safer and cyber hardened as well as being much more transparent than current monetary mechanisms but obviously no where near as widespread, although crypto credit cards are now available in the US. using regular currency as an intermediary monetary unit. Probably as in most industries there is an IT disruptor looming around the corner, and this is one for the finance industry I feel  ... there is also the concept of the community aspect to improve their transaction efficiency, which is termed mining which if again if you are interested can be a steady stream of low value income..however the growth in Cryptos has outpaced Moore's Law and so profitability here is getting harder for the average punter .. and doing this is very sensitive to the price of electricity which in the U.K. is rather high...

In some ways it feels quite similar to the early days of the web, where those of us who then used, adopted, developed and worked with it were considered outside of technical communities geeks and it's products and uses socially non mainstream.... now twenty five years later it is very different..... and yes in the early days of the web there were fanciful get rich quick schemes.. and some did, but most found it an alternative channel of creating wealth and consuming it..

count.d posted:

" As for the boast... It's $3.8 million not $2.8 million.. Not that +/- a million $ will matter in 10 years"

Kevin, the $600,000 loss is correct, I typed $2.8 instead of $3.8 here. You should have instantly understood the discrepancy. Perhaps your generations would appreciate the odd $600,000 now, instead of waiting until they're 103 for the big surprise.

You don't know it will grow over the next 10 years or 10 days, this is my point. If you knew, you wouldn't lose 15%. You're the one who boasted a value increase over days, I'm addressing that issue. It doesn't make me feel better whether the price goes up or down for you. I thought the thread started off with a potential to be interesting, but ended just being a platform to boast your wealth. I don't understand the logic behind your investing, I don't understand Bitcoins and tbh, I don't understand investing for 100 years time. Best of luck anyway. 

I was not "bragging" or "boasting". I was simply sharing my experience in concrete terms. I am a relatively "normal" person. [I was not born into money. I went to university and worked for everything I have in life.] I told you I bought AMAZON in the weeks following the 9/11 terrorist attacks. You called that "easy". I bought Bitcoin and 99% of all people think I'm a fool.

There is no point on trying to time the market when you believe the asset will continue to appreciate. The tax burden of 45% makes selling a losing proposition. Also, I have no ability to sell.

You are correct; I do not know if BTC will appreciate over next 10 years. However, I have spent years studying the technology and it has changed my life. I had a near cathartic experience when I saw clearly the underlying beauty of Bitcoin. It hit me that the massive wealth inequalities in the US can and WILL be mitigated by the adoption of Bitcoin. Average people now have access to "real money" that will [if I am correct] exponentially increase their wealth relative to local fiat.

The "100 year" investment strategy was the result of the first major crash in Bitcoin in 2013. I saw BTC fall from $1,250 -> [some very low number which I was too depressed to even look]. I kept thinking "I should have sold.... I could do x or I could do y." After spending months\years in a severely depressed condition, I finally started to accept my "loss". I still believed in the technology but did not want to constantly worry about its USD value. I decided to hold them "forever". I created a trust which makes access to the private keys impossible at least until the year 2036. I thought maybe by that time they would provide $ to fund my children's retirement and/or grandchildren's college education.[ I am glad I did this since knowing the USD value now relative to my current income would create significant "emotional distress".] Now, however, I am realizing the dream of a democratic currency will come true. I am confident that my Bitcoin will allow my descendants absolute financial security. [Something I never even considered prior to Bitcoin]

So maybe I should not have used my Bitcoin wealth as an example. Please look at it from my point of view. I have been nearly constantly advocating my friends\family\colleagues to buy bitcoin. Nobody took my advice or even, AFAIK, took the time to learn about it. My colleagues derided it as a "Ponzi scheme", "a scam", and a "worthless nothing that will never have any real value". I then post on here in an attempt to chat up Bitcoin a bit and am met with mostly "subtle mockery." My goal was not to "bask in the glory of my infinite wisdom" but to merely share how absolutely committed I am to idea of Bitcoin.

I really hope that everybody on this forum takes the time to truly understand the Bitcoin\Crypto technology. Once you understand how it works, you will understand why it will change the world for the better. 

Simon-in-Suffolk posted:

Bragging or boasting a side, I find crypto currencies a fascinating technology, and I suspect a possible vignette of future currencies and monetary transaction frameworks... certainly getting involved with them is fascinating if you are that way inclined... they appear are very much safer and cyber hardened as well as being much more transparent than current monetary mechanisms but obviously no where near as widespread, although crypto credit cards are now available in the US. using regular currency as an intermediary monetary unit. Probably as in most industries there is an IT disruptor looming around the corner, and this is one for the finance industry I feel  ... there is also the concept of the community aspect to improve their transaction efficiency, which is termed mining which if again if you are interested can be a steady stream of low value income..however the growth in Cryptos has outpaced Moore's Law and so profitability here is getting harder for the average punter .. and doing this is very sensitive to the price of electricity which in the U.K. is rather high...

In some ways it feels quite similar to the early days of the web, where those of us who then used, adopted, developed and worked with it were considered outside of technical communities geeks and it's products and uses socially non mainstream.... now twenty five years later it is very different..... and yes in the early days of the web there were fanciful get rich quick schemes.. and some did, but most found it an alternative channel of creating wealth and consuming it..

Some good points. The days of the "little guy" mining Bitcoin is about over. You can still profitabily mine in the US but the better approach is to simply buy and hold.

The thing that differentiates Bitcoin from most of the 900+ other crypto currencies is the organic growth of the community. It started with just a handful of people and has grow to millions. It was not conceived with purely a "profit motive" [many of the other coins are outright scams]. When your "average person" finally has access through [what they consider "legitimate sources" [IRA, 401k, Stock Exchanges...], they will most likely want to first hold Bitcoin and then speculate on other crypto coins.

What are the real constraints on price appreciation of Bitcoin? Consider the world wide Gold market % allocated to investments = something like 3 Trillion USD. Bitcoin is slowly being recognized as having most of the positive attributes of gold without many of the negatives. I believe it is very likely that in 20 years, half of the gold investments will transition into Bitcoin. This alone, all other things remaining static, would elevate the price to $89,090. Is this really possible? Im quite confident given admittedly  anecdotal evidence from fellow gold bugs having already diversified into Bitcoin. Now consider the US Bond market. It has been on a 40+ year bull run. Unfortunately, the game is nearly over as there are $ trillions(?) of negative yielding bonds currently in existence. If interest rate are raised, bond holders will lose massive amounts of wealth. The standard 80-20 Equities-Bonds does not look great in the next 10+ years. I suspect a great deal of institutional and retail USD will flow into the Crypto space. I have no data to back up that claim just going on my instincts. So maybe another $ trillion from bond/equities -> $148,535 price for bitcoin. Now look at the "post oil" world. The USD is largely propped up by the fact that the global oil markets are priced in USD. What happens to USD in 50 years when everything runs on renewable energy? My somewhat informed opinion is that it will lose its status as the primary world reserve currency. What currency will replace USD? Quite possibly Bitcoin. In this scenario, very long term really beyond my lifetime i suspect, Bitcoin will ascend to $1 MM + valuation.

All those number are great to imagine but leaves out the single greatest source for massive price appreciation: mass acceptance by average people tired of feeding the majority of the world's wealth into the hands of the top .1%. [I'm a member of this camp.] Crypto will likely become a multi trillion $ asset class and the bankers do not get to create bitcoin out of "thin air". They will have to buy it on the open market just like your average Joe. In this space, they will not get same ridiculous advantage they exploit in "legacy" markets.

My challenge remains the same as always.... buy 1 bitcoin and hold it. You do not have to buy a whole bitcoin in a single transaction. In the US you can buy as little as $0.01 at a time. If the volatility concerns you, "dollar cost average" into it over 3-6 months. Then keep buying small amounts every week with some fairly trivial amount of fiat.

I may have mentioned this before but I'll say it again. Would  you go back in time to the early 17th century and buy land in Manhattan? That is the type of opportunity I believe Bitcoin offers people today. Except you probably only need to wait 10 years vs 300.

Simon-in-Suffolk posted:

Bragging or boasting a side, I find crypto currencies a fascinating technology, and I suspect a possible vignette of future currencies and monetary transaction frameworks... certainly getting involved with them is fascinating if you are that way inclined... they appear are very much safer and cyber hardened as well as being much more transparent than current monetary mechanisms but obviously no where near as widespread, although crypto credit cards are now available in the US. using regular currency as an intermediary monetary unit. Probably as in most industries there is an IT disruptor looming around the corner, and this is one for the finance industry I feel  ... there is also the concept of the community aspect to improve their transaction efficiency, which is termed mining which if again if you are interested can be a steady stream of low value income..however the growth in Cryptos has outpaced Moore's Law and so profitability here is getting harder for the average punter .. and doing this is very sensitive to the price of electricity which in the U.K. is rather high...

In some ways it feels quite similar to the early days of the web, where those of us who then used, adopted, developed and worked with it were considered outside of technical communities geeks and it's products and uses socially non mainstream.... now twenty five years later it is very different..... and yes in the early days of the web there were fanciful get rich quick schemes.. and some did, but most found it an alternative channel of creating wealth and consuming it..

I forgot to mention a way for everybody to mine coins at a profit. Last year I started running a program on my music server called Minergate [minergate . com] and have mined a bit over $2,000 worth of Monero. I calculated it took < 10 watts/hour to run 3 threads. I did it for two reasons: 1. I like mining as a hobby 2. The early amounts more than covered the cost of the additional electricity. [I leave my computer on 24x7 for music etc]

It is still profitable to mine Monero on that site. I am currently mining about $5 USD / week. [The price of Monero shot up from like 3$ -> 140$ in past year] Give it a try. You probably won't get rich but it is easy and free Crypto with a potential for significant price appreciation in the coming years.

count.d posted:

" As for the boast... It's $3.8 million not $2.8 million.. Not that +/- a million $ will matter in 10 years"

Kevin, the $600,000 loss is correct, I typed $2.8 instead of $3.8 here. You should have instantly understood the discrepancy. Perhaps your generations would appreciate the odd $600,000 now, instead of waiting until they're 103 for the big surprise.

You don't know it will grow over the next 10 years or 10 days, this is my point. If you knew, you wouldn't lose 15%. You're the one who boasted a value increase over days, I'm addressing that issue. It doesn't make me feel better whether the price goes up or down for you. I thought the thread started off with a potential to be interesting, but ended just being a platform to boast your wealth. I don't understand the logic behind your investing, I don't understand Bitcoins and tbh, I don't understand investing for 100 years time. Best of luck anyway. 

Uh...that's called volatility.

Cash in a mattress'd be good for you...

Kevin...would you please buy ME a Lamborghini????

DrMark posted:
count.d posted:

" As for the boast... It's $3.8 million not $2.8 million.. Not that +/- a million $ will matter in 10 years"

Kevin, the $600,000 loss is correct, I typed $2.8 instead of $3.8 here. You should have instantly understood the discrepancy. Perhaps your generations would appreciate the odd $600,000 now, instead of waiting until they're 103 for the big surprise.

You don't know it will grow over the next 10 years or 10 days, this is my point. If you knew, you wouldn't lose 15%. You're the one who boasted a value increase over days, I'm addressing that issue. It doesn't make me feel better whether the price goes up or down for you. I thought the thread started off with a potential to be interesting, but ended just being a platform to boast your wealth. I don't understand the logic behind your investing, I don't understand Bitcoins and tbh, I don't understand investing for 100 years time. Best of luck anyway. 

Uh...that's called volatility.

Cash in a mattress'd be good for you...

Kevin...would you please buy ME a Lamborghini????

What? What's it got to do with you. This is a conversation between me and Kevin. Stay out of it and ignore me.

Kevin, it will be interesting to follow the Bitcoin prices. Your last few posts have made interesting reading. 

 

DrMark posted:
count.d posted:

" As for the boast... It's $3.8 million not $2.8 million.. Not that +/- a million $ will matter in 10 years"

Kevin, the $600,000 loss is correct, I typed $2.8 instead of $3.8 here. You should have instantly understood the discrepancy. Perhaps your generations would appreciate the odd $600,000 now, instead of waiting until they're 103 for the big surprise.

You don't know it will grow over the next 10 years or 10 days, this is my point. If you knew, you wouldn't lose 15%. You're the one who boasted a value increase over days, I'm addressing that issue. It doesn't make me feel better whether the price goes up or down for you. I thought the thread started off with a potential to be interesting, but ended just being a platform to boast your wealth. I don't understand the logic behind your investing, I don't understand Bitcoins and tbh, I don't understand investing for 100 years time. Best of luck anyway. 

Uh...that's called volatility.

Cash in a mattress'd be good for you...

Kevin...would you please buy ME a Lamborghini????

Hmmmm..... Well you were the first to ask so I guess you'll be first in line!

DrMark posted:

"Brett Arends called Bitcoin garbage with no real world use outside of online gambling, trafficking in illegal goods and services, and money laundering. "

Well yes, that is what Central Bank Useful Idiots would say. They're saying the same things about cash too...just to begin priming the pump of public stupidity, er, I mean opinion. (See Rogoff, Summers, etc.)

Simple fact is they hate anything that might break their grip on total control of everything, because if you control the money supply, you are 100% in charge. This hatred encompasses cryptos, PMs, and cash. Of course, the simple fact that the US dollar has lost 97% of its purchasing power since the Federal Reserve was formed should give no one pause for thought...after all, they are the experts.

That is why that silly/stupid woman running the Fed can make a statement as she did last month that we are highly unlikely to see another financial crisis in our lifetimes - oh really Janet? I give it 2, maybe 3 years at most. An awful lot of this bogus credit loaned at faux interest rate levels that prompted this "recovery" is NEVER getting paid back. And once the dominoes start to fall, watch out below - 2008 will look like a walk in the park, because the setup is exactly the same, only this time the numbers are way larger.

The reality is that when we deposit money in a bank, it is literally no longer our money...all we have become is an unsecured creditor to the bank. And almost all western nations have passed "bail-in" laws in the past 5 or so years. Cyprus was just a Beta-test.

I am not in cryptos, but looking to get some exposure - definitely NOT something for the rent money. Interested in Ethereum, Factom, maybe Monero, and there is an ICO of Ahoolee upcoming - but the whole exchange/wallet thing is difficult for me to wrap my head around.

Cryptos, PMs (including shares of quality miners and royalty companies), some physical cash, and shorts (including long-dated puts) on highly indebted companies with lousy balance sheets. Then after the crash, go shopping for the stocks of quality businesses that will be on sale at massive discounts.

The "easiest"/"safest" wallet is a hardware wallet like the Trezor [I got one for $105]. It can currently hold BTC, LTC, ETH, ETC, ERC20 Tokens, DASH, and ZEC. Currently no Monero support .... but hopefully it will soon.

Ethereum and Litecoin here... seem to be doing rather well .. especially the latter. I have set myself a little game... how long will it take, if ever, for a £1000 to get to £20,000 and then I might just treat myself to a 552, if it all goes horribly wrong well I will have lost £1000 and slum it with my 252... it feels a bit like my own Blue Peter Appeal 'Totaliser' board. I just hope I don't get too old and deaf by the time it happens 

Simon-in-Suffolk posted:

Ethereum and Litecoin here... seem to be doing rather well .. especially the latter. I have set myself a little game... how long will it take, if ever, for a £1000 to get to £20,000 and then I might just treat myself to a 552, if it all goes horribly wrong well I will have lost £1000 and slum it with my 252... it feels a bit like my own Blue Peter Appeal 'Totaliser' board. I just hope I don't get too old and deaf by the time it happens 

Probably sooner than you think. LTC already got to $94 USD this evening. LTC just had the first Lightning network transaction which has made a lot of people bullish on the coin. [$500 by 2019?]

My personal "moonshot" coin is NEO. A platform that has significant advantages vs Ethereum. Currently trading around $31 USD. Most holders believe NEO will appreciate to a market cap similar to Ethereum in 18-24 months. [15x?] Although recent rumors regarding "government meddling (regulation)"  have spooked the price down by 25% this week..... September 10 will be an important date for the near term prospects. [This is my "get the new Berkeley DAC" coin....]

Anyhoo.... Hope it works for you. [Im holding ETH and LTC long term]

 

 

Kevin Richardson posted:

Just a quick update on Bitcoin price action. Today "pre fork" BTC hit a new all time high of $5,479 USD. Possibly a correction coming once "post fork" BTC hits $5,000 USD but.... wow....

Ok there was a 12% "correction" across the Cryptocurrency sector today after the "post fork" BTC was unable to break the $4,975 sell wall.... I was pretty close on the 5k but I went to sleep with a SELL order above 5K. My night was filled with dream about bitcoin. In my dream the price was either $4,500 or $5,500. I did not want to wake up since I knew it was more likely to be down... and it was @ $4,500 ish by time I looked.

So it isn't a straight line up. However, it is still up 3.52% for the week. Might be some additional downward pressure over the next week if anybody is looking for a "cheap" entry point.

JamieWednesday posted:

So, if/when we have a similar cash 'liquidity' issue as per 2007, which caused pretty much all assets to drop in value, what happens to Bitcoin? Down, up, nothing? 

Liquidity crisis is unlikely to negatively impact Bitcoin price. It is currently very difficult [impossible?] to enter into highly leverage BTC long positions. The entire market is 70 billion USD with a near 0 $ derivatives market. [I believe there are some tiny exchanges which offer some kind of options but the USD value is probably just a rounding error] If you hold your private keys, Bitcoin has 0 counter-party risk. Some hedge funds MAY own 100,000 BTC [not sure but probably few could own more]. If for some reason they decided to sell them to raise USD, the price would plummet to the point selling them would not raise a significant amount of USD so it appears to be a poor option. [Unless there are a buyers pumping in $ fleeing the equities\bond markets.]

If we have another event the size of 2008's Solomon Brothers bankruptcy, I suspect USD would flow into Bitcoin as a 21st century "safe haven". [Gold\Silver got killed in September - December 2008 due to the massive leverage of the paper-market] UST yields would drop below 0%. People need to put their USD somewhere..... So my guess is if it happened in the next few months, Bitcoin would go up in USD price.

In retrospect I'd say Bitcoin started as a really cool idea but is now on its way to become something sinister. Because the USDs you now invest in Bitcoin probably go to a drug lord or a cyber criminal. This use and speculation ultimately drive the Bitcoin value. I can't see it as an utopian currency for the "common man".

Common men need a stable currency which can be used to reliably pay the rent or buy food. The use of a currency must be simple and understandable. A currency must be accepted everywhere in its region. A real currency is closely related to a "real" national economy and thus backed by real work.

Nothing of this applies to Bitcoin. A national economy based on Bitcoin would collapse due to deflation, i.e. everyone would keep clinging to their precious Bitcoins because they still rise in value. That's the reason why central banks try to avoid deflation at all cost.

If I were you I'd sell my Bitcoins and get a nice apartment in Manhattan. Because Manhattan will still exist in 20 years.

 

Huge, I am not sure Kevin is particularly smug - just sharing his experiences - and perhaps doing that in a way that riles you. Its still early days but cryptos don't behave like regular currency,  traditional investments or traditional commodities.  As I say this was exactly the same sort of attitude in my experience that occurred with the early web in the early to mid 90s when people were grabbing domain names and then selling them or using them to set up services  - and most were very dismissive at the time as it was seen as simply too 'geeky' - but that was a side show to the whole world that was then opening up.. and yes I have still my domain names and two of them I am pretty pleased about and made some money from being able to optimise my web site for Google matches by 'playing' the algorithms  - before big business stepped in making it harder for newcomers... another early web geek culture.

Cryptos have been around as we know them from around 2012/13 - they are just starting to leave the geek and ultra early adopter phase ... have a look into it - but try and get and beyond the personality of the messenger.. you may want to play in the space - it doesn't have to cost a lot - and if you hodl some new alternative crypto coins you may be able to have some fun with them in a few years time... 

 

Kevin, its interesting to muse here what the relationship between LTC and BTC will be when Lightning Network is activated on the Bitcoin network... as that of course brings atomic transactions the LN transaction cost will almost certainly be cheaper via LTC than BTC which may well push the value up of LTC coins...

Also you can really see how big business can start to use this with the arrival of SegWin and LN and create their own block chains for their businesses and consumers - a bit like a 21st century store card that can extend easily to associate partners and provide so much more  - sort of like a combined private currency/social network .... [it looks like Bugger King are toying around with something similar to this in Russia]. You can see how cryptos could become the new currencies of the future where traditional centralised currencies from national banks are effectively privatised and decentralised and perhaps only used for state transactions like taxes, benefits, state assets and government contracts. I am sure the regulator will try and impede this and control this as with regular web technology - and so will be a case of catchup for them - but also they will be under pressure not too stifle innovation - as players here could be great at creating new tech business revenue streams and potentially provide great commercial advantage - and more resultant taxable wealth...

So SegWit and LN really do introduce the feasability  of real electronic privatised currencies without transactions needing to use nationalised currencies as intermediaries. Interesting times. In ten years if I find this post/thread it will be interesting to refer back - a time capsule if you like... 

jfritzen posted:

In retrospect I'd say Bitcoin started as a really cool idea but is now on its way to become something sinister. Because the USDs you now invest in Bitcoin probably go to a drug lord or a cyber criminal. This use and speculation ultimately drive the Bitcoin value. I can't see it as an utopian currency for the "common man".

Common men need a stable currency which can be used to reliably pay the rent or buy food. The use of a currency must be simple and understandable. A currency must be accepted everywhere in its region. A real currency is closely related to a "real" national economy and thus backed by real work.

Nothing of this applies to Bitcoin. A national economy based on Bitcoin would collapse due to deflation, i.e. everyone would keep clinging to their precious Bitcoins because they still rise in value. That's the reason why central banks try to avoid deflation at all cost.

If I were you I'd sell my Bitcoins and get a nice apartment in Manhattan. Because Manhattan will still exist in 20 years.

 

Let me try to "spin" some of the issues:

1. USD -> "drug lord or cyber criminal": In the USA, the biggest gateway between USD and Bitcoin is Coinbase.com. To transact through them, you need to provide all the information banks request when you open an account. They also place a relatively small max $/day that can be withdrawn [$10,000 USD]. If you are a criminal, you probably do not want anything to do with Coinbase.

2. "crime and speculation driving BTC value": There certainly is a lot of speculation going on in BTC. Bitcoin has also been used by criminals. Bitcoin is not great for criminal activity due to the fact the ledger is public and organizations like FBI are getting better at being able to trace Bitcoin payments. Long term, Bitcoin will not be the coin of choice if you need absolute privacy. [There are some privacy focused coins like Monero, Cash, DASH. <= These coins are impossible to trace sender, receiver, amounts.] Bitcoin did gain noteriety by its use on Silk road and the dark web but this is no longer a primary use-case.

Speculation -> increased volatility -> less stability. This is a real problem. Volatility should decrease over time as the distribution of BTC spreads over a much greater % of the population.

3. "Common men need a stable currency to pay rent\food": This is a big problem right now. Bitcoin may never become a "transactional currency" for small purchases. There are other coins vying for that role [LTC]. Bitcoin may be happy to become just a "store of value" for long-term wealth preservation. [However, the number of merchants accepting Crypto as payment increases every day. My kids' violin teacher is considering accepting BTC\LTC]

Do you remember when working people "saved for retirement"? Over the past 20-30 years the term "save" has been slowly replaced with the word "invest". People now need to "invest for retirement". Is that a big deal? Yes. [For many reasons]

   1. Most people know nothing about investing

   2. Most traditional investments offer greater rewards to wealthy individuals and middle income people just get scraps.

   3. Traditional assets are manipulated to a point avg people can not make real long term predictions.

This gives Bitcoin a possible wealth preservation role in long-term portfolios. [In 20+ years once the exponential growth finishes.]

4. "It needs to be easy": Crypto is currently fairly complicated to use but new products are appearing to make crypto as easy to use as debit cards\paypal\cash. Older people may not get involved but younger people [and future generations] will likely view Bitcoin\Crypto in the same way we view ATM\Debit cards [My mother is in her 70's and refused to have an ATM card until this year (she would carry $600-$1,000 in cash whenever she took a trip)]

5. "Currency must have universal acceptance in a geo area": Unfortunately, even the mighty USD is not accepted at every merchant in the USA. [I was on a flight and they would only accept VISA as payment for drinks (I do not drink but felt like it was a scam to not accept cash)]

6. "A real currency is backed by real work": That is a great utopian view on central bank issued \ debt backed currency. How many trillions of USD are created by speculation on the financial markets? Is that "real"? Every bitcoin created takes substantial investments into the real economy. [CPU, GPU, Electricity, Realestate, Salaries etc.....] Also, Crypto market is rapidly expanding in terms of new companies creating new products with real world applications.

7. "national currency can not be deflationary": True. The Fed needs to constantly print USD so people can keep up with interest on debt payments. This QE\0% interest rate steals wealth from savers and hands it to speculators\materialists. I am not going to suggest that BTC will replace USD in my lifetime. However, in time the price of BTC should start to level out to the point that predictable price increases will replace the current "highly volatile exponential growth" period. At that point, people will not feel the need to "cling" to BTC and should be thought of an asset class like gold. [My home was purchased with gold. I can see a day when people will "save" in BTC for large purchases like homes\education\retirement. Right now how can people "save" for a 20% downpayment on a house when home prices increase >> wages\inflation & interest rates on savings are 0%?]

8. "buy a nice condo in Manhattan": I've looked at nice places in Manhattan and.... too much $.... Also you never really own real estate in the USA. You are simply renting it from the government. If you think that is not true.... try not paying your property taxes. The government will sell your property to somebody else.

You made some good points about the current issues with Bitcoin. As you can see, I am optimistic that many of the current problems will get solved and adoption will continue to speed up. If I am wrong... well... I'd by lying to say I will not be greatly disappointed.

Simon-in-Suffolk posted:

Kevin, its interesting to muse here what the relationship between LTC and BTC will be when Lightning Network is activated on the Bitcoin network... as that of course brings atomic transactions the LN transaction cost will almost certainly be cheaper via LTC than BTC which may well push the value up of LTC coins...

Also you can really see how big business can start to use this with the arrival of SegWin and LN and create their own block chains for their businesses and consumers - a bit like a 21st century store card that can extend easily to associate partners and provide so much more  - sort of like a combined private currency/social network .... [it looks like Bugger King are toying around with something similar to this in Russia]. You can see how cryptos could become the new currencies of the future where traditional centralised currencies from national banks are effectively privatised and decentralised and perhaps only used for state transactions like taxes, benefits, state assets and government contracts. I am sure the regulator will try and impede this and control this as with regular web technology - and so will be a case of catchup for them - but also they will be under pressure not too stifle innovation - as players here could be great at creating new tech business revenue streams and potentially provide great commercial advantage - and more resultant taxable wealth...

So SegWit and LN really do introduce the feasability  of real electronic privatised currencies without transactions needing to use nationalised currencies as intermediaries. Interesting times. In ten years if I find this post/thread it will be interesting to refer back - a time capsule if you like... 

Yes! This is why i refer to Crypto as Internet 4.0.

LTC is really trying to become the future "transactional currency" for every day use. I generally use LTC for fast\cheap movement from USD --> exchanges where I can trade into my current basket of coins. I also hold it long-term as it has tremendous potential. [There is a rumor that some big companies will start accepting LTC as payment.]

There is a coin [OMG] which recently struck a deal with McDonalds in Thailand. McDonalds will start to accept payments in OMG. Could this spread to McDonalds in other markets? Take a look at it as many people are extremely bullish on its future.

One this is certain, Asia is signaling strong belief in the long-term prospects for Crypto currencies.

i think you may mean Web 4.0.. internet is simply the network connectivity protocols and is governed by IPv4 and IPv6, not the apps. However Web 4.0 is the mobile web apps space and Web 5.0 is classed by some as the 'Open, Linked and Intelligent web' and I think one can see how Cryptos using LN fit into that. I agree about Asia.. they do seem to be embracing Crpto currencies in quite an interesting way...perhaps they will steal a march over the US and Europe?

Huge posted:

OK, I'm leaving... I've just had enough of this draconic / Ferengi (take your pick) approach and smugness.

I had to google Ferengi. I do not understand why you view my posts so negatively. I am not trying to sell you anything. I am just hoping to share some of my excitement, knowledge, and views related to Bitcoin\Crypto currencies. The reality is that Cryptos may completely transform the world over the next 20 years and knowledge is power. Many people are "sticking their heads in the sand" and this may create a significant lost opportunity.

As for the smugness... My recent posts were on price action this week and liquidity crisis. One where BTC hit a fresh all time high. One where the entire market tanked by 12%. The last post I just tried to give some idea why a 2008 level liquidity crisis would likely increase BTC price.

Simon-in-Suffolk posted:

i think you may mean Web 4.0.. internet is simply the network connectivity protocols and is governed by IPv4 and IPv6, not the apps. However Web 4.0 is the mobile web apps space and Web 5.0 is classed by some as the 'Open, Linked and Intelligent web' and I think one can see how Cryptos using LN fit into that. I agree about Asia.. they do seem to be embracing Crpto currencies in quite an interesting way...perhaps they will steal a march over the US and Europe?

In fact I really do mean Internet 4.0. My view is that the protocols created to form the distributed networks supporting Crypto create a new layer as impactful as the WWW.

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