The Bubbly Bitcoin Thread -- Merged Threads

[BufferBear Bitcoin Bull]

3 hours ago, Pop321 said:

This is my biggest issue with the guys at the top. The odd $100m is seemingly a small amount when dealing with the values we see in BTC or the companies involved in digital currency and crypto. However the big whales are set up (in property and/or other assets) for life regardless as to where the price ends up.

For context, with a 80% fall Coinbase is now only ‘worth’ $11bn. And it pays 0% divide. Set up a few years. 

That’s more than some established FTSE 100 firms in the UK….and more than any FTSE 250 firm. 

The crypto, digital currency and block chains plus associated businesses have a place. Again it’s just the valuations that I believe to be way of course.  

Agree….this highlights to me a different stance to many coin advocates. Balanced and in context that it is an asset rather than THE ONLY asset.

My aim for the next 5/10 years is only to ensure my wealth holds its relative value during these volatile times.

I am expecting a dip once the US feels the pain of higher rates and the Fed pivots…probably an initial final rally and the a sustained and large dip. Then there will be some opportunities to buy cheaply into high yielding established firms that do well in difficult circumstances. Easier said than done of course. 

Those buying $100m houses will have businesses that may lose a fortune….but regardless they won’t go hungry.

Most companies making huge profits are misleading Investors owing to the lack of regulation.  It really is a licence to print money and many are now getting rekted and will be rekted. Coinbase executives benefitted from having no lock in period for equity held this and Brian Armstrong proactively misinforms retail by referring to crypto as one entity rather than singling out BTC as he did before he saw the benefits of avoiding this. CB encourage Ponzi schemes and one of the reasons CB’s value has dropped is owing to concerns that many of the tokens/coins on offer will be deemed securities by the SEC. Others argue, CB will offer  financial services etc. 
 

I do not put BTC in the same camp given there is no company or CEO behind it. BTC markets itself and is solving a real life problem. 

[BufferBear Bitcoin Bull]

Ps we know p/e is totally out of whack and now they are feeling the correction.  We probably have further to fall especially the top performers which gives a false picture of stock market growth. When q/e is stripped out, apparently, growth is flat. 
 

Everyone should own bitcoin, if only 1% of wealth to act as a hedge should it do what many on here do not expect it to do given its asymmetry. 

Edited June 29, 2022 by Buffer Bear

[BufferBear Bitcoin Bull]

It’s hard to understand that crypto and bitcoin are not in the same camp.  Once you understand the difference, everything else falls into place. BTC first really is a thing.  Zero to one. That’s it. 

Edited June 29, 2022 by Buffer Bear

[Confusion of VIs]

1 hour ago, Buffer Bear said:

 

As of today MicroStrategy Market Cap $2.1bn Debt (6th June) $2.4bn.

Despite Saylor's protestations that the company is far from facing margin call this looks like squeaky bum time for investors. This article describes how he is able to claim no risk of margin call until $7k

 Media's Misunderstanding Cost MicroStrategy $600 Million (NASDAQ:MSTR) | Seeking Alpha

 

 

 

[lombardo]

2 hours ago, Buffer Bear said:

 

 

 

 

This man will have the last laugh. Great purchase.

[Pop321]

1 hour ago, lombardo said:

This man will have the last laugh. Great purchase.

I am less certain of the price being a great purchase (whether it goes up or down, who knows)....but I absolutely agree he will have the last laugh. 

[lombardo]

7 minutes ago, Pop321 said:

I am less certain of the price being a great purchase (whether it goes up or down, who knows)....but I absolutely agree he will have the last laugh. 

Why does where it's going to go in the next few months determine if this is a great purchase when we don't know where it's going? If we know it's cheap compared to where it will be in 4 years time, then it's a good purchase. 

[Pop321]

3 hours ago, Buffer Bear said:

Ps we know p/e is totally out of whack and now they are feeling the correction.  We probably have further to fall especially the top performers which gives a false picture of stock market growth. When q/e is stripped out, apparently, growth is flat. 

Everyone should own bitcoin, if only 1% of wealth to act as a hedge should it do what many on here do not expect it to do given its asymmetry. 

P/Es are so far 'out of whack' there is no 'probably have further to fall'....it will happen. 

There are real shares in companies paying 7/11% dividends which are doing well but you need to know the macro cycles and keep vigilant. Some of these with top slicing mean they have paid for the initial investment over the last 6/7 years.  Happy with the strategy of owning tangible assets which should keep up with inflation and protect wealth. 

3 hours ago, Buffer Bear said:

It’s hard to understand that crypto and bitcoin are not in the same camp.  Once you understand the difference, everything else falls into place. BTC first really is a thing.  Zero to one. That’s it. 

That's why I referred to them separately. 

[Gbob]

2 hours ago, Confusion of VIs said:

As of today MicroStrategy Market Cap $2.1bn Debt (6th June) $2.4bn.

Despite Saylor's protestations that the company is far from facing margin call this looks like squeaky bum time for investors. This article describes how he is able to claim no risk of margin call until $7k

 Media's Misunderstanding Cost MicroStrategy $600 Million (NASDAQ:MSTR) | Seeking Alpha

He might as well. Whats the worst that can happen? MicroStrategy become bankrupt while Saylor disappears in a tragic boating accident? Meanwhile, in El Salvador a new resident arrives called Mickey S. Aylor

[Pop321]

1 minute ago, lombardo said:

Why does where it's going to go in the next few months determine if this is a great purchase when we don't know where it's going? If we know it's cheap compared to where it will be in 4 years time, then it's a good purchase. 

Why do you think I am referring to the next few months? I said ''whether it goes up or down, who knows?''

That means I was saying I don't know its cheap compared to where it will be in 2 months, 9 months, 2 years, 4 years 10 years time. 

[lombardo]

2 hours ago, Pop321 said:

Why do you think I am referring to the next few months? I said ''whether it goes up or down, who knows?''

That means I was saying I don't know its cheap compared to where it will be in 2 months, 9 months, 2 years, 4 years 10 years time. 

I guess I differ because I think it may go up or down in the next year but over the next few years I can't see it not reaching $100k. For me buying BTC is a no brainer right now because it is at a historic low. It may lose another 40% but that I don't know.

[Pop321]

2 hours ago, lombardo said:

I guess I differ because I think it may go up or down in the next year but over the next few years I can't see it not reaching $100k. For me buying BTC is a no brainer right now because it is at a historic low. It may lose another 40% but that I don't know.

And that’s fair enough as a viewpoint. Your money….your decision and you might be right. 

One caveat is my approach to money, investing and acquiring wealth absolutely nothing is a no brainier when it comes to investing

I was in a position to retire at 40 having started as a young dad at 17 as a junior in an office, worked hard and I learnt quickly…. (I didn’t leave work until 50…because I enjoyed it and I felt it didn’t set a great example to my kids…daft I know)….nothing was a no brainier, not even leaving work. 

From The Big Short “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

I always keep that open mind….I can see BTC over the next few years at £1m and I can see it collapsed and dissolved at £0. My current position (not invested) means I am continue in my retirement either way.

[micawber]

19 hours ago, Buffer Bear said:

Everyone should own bitcoin, if only 1% of wealth to act as a hedge should it do what many on here do not expect it to do given its asymmetry.

This is the Ponzi factor that worries me. It only "succeeds" if it can continue to attract new investors.

I'd never go around saying that everyone should own Stock X, Y or Z, or Gold, etc. They will sell themselves.

[dugsbody]

11 hours ago, Pop321 said:

I always keep that open mind….I can see BTC over the next few years at £1m and I can see it collapsed and dissolved at £0. My current position (not invested) means I am continue in my retirement either way.

For me it is the disproportionate nature of the bet that got me involved. That and realising other people could easily continue bidding the price up.

I invested an amount I was willing to lose (still quite large), and immediately removed it from my spreadsheet on which I track my finances. That money is gone. But, it also has the potential to generate a massive windfall, and the potential is actually reasonably good odds. I think it has more than a 50% chance from here of going to $100k. To me, that is a good bet. Buying right now, 5x your money out at > 50% chance.

(Of course, the 50% chance is made up, it's only my thoughts, but that is how it works for every investment, a guess on odds).

[henry the king]

6 minutes ago, dugsbody said:

For me it is the disproportionate nature of the bet that got me involved. That and realising other people could easily continue bidding the price up.

I invested an amount I was willing to lose (still quite large), and immediately removed it from my spreadsheet on which I track my finances. That money is gone. But, it also has the potential to generate a massive windfall, and the potential is actually reasonably good odds. I think it has more than a 50% chance from here of going to $100k. To me, that is a good bet. Buying right now, 5x your money out at > 50% chance.

(Of course, the 50% chance is made up, it's only my thoughts, but that is how it works for every investment, a guess on odds).

I see so many people who say "I invested what I could afford to lose".

But that depends how you define "afford to lose". Like, if I had 100k of savings I could "afford to lose" 80k or something. But that still would massive hurt my standard of living and security going forward. 

So the whole phrase is kind of a joke "invest what you can afford to lose" because most people aren't honest about the costs of losing their money. 

[Huggy]

1 hour ago, henry the king said:

I see so many people who say "I invested what I could afford to lose".

But that depends how you define "afford to lose". Like, if I had 100k of savings I could "afford to lose" 80k or something. But that still would massive hurt my standard of living and security going forward. 

So the whole phrase is kind of a joke "invest what you can afford to lose" because most people aren't honest about the costs of losing their money. 

Invest no more than you are willing to lose is the rule that every investor should live by.

The meaning of the word afford is "have enough money to pay for", so technically losing 80k out of 100k does fit. Even so, I'd still say I can't afford to lose 80% of my entire investment portfolio. They're interchangeable in this regard IMO.

[scottbeard]

2 hours ago, micawber said:

This is the Ponzi factor that worries me. It only "succeeds" if it can continue to attract new investors.

I'd never go around saying that everyone should own Stock X, Y or Z, or Gold, etc. They will sell themselves.

But surely the price of ANYTHING only goes up if either the existing interested investors are willing to pay more for it, or you attract new investors?  You could say that of anything with finite supply, from Van Gogh paintings to shares in HSBC.

Something is only a Ponzi scheme if "returns" are paid not from an underlying investment but from the subscriptions of new subscribers, a model which will eventually fail as it is exponential in nature, at which point the investment is worth zero.

If no new investors ever want any Bitcoin it just means the price stays where it is, not drops to zero like a Ponzi.

[henry the king]

44 minutes ago, Huggy said:

Invest no more than you are willing to lose is the rule that every investor should live by.

The meaning of the word afford is "have enough money to pay for", so technically losing 80k out of 100k does fit. Even so, I'd still say I can't afford to lose 80% of my entire investment portfolio. They're interchangeable in this regard IMO.

Well a gambling addict is willing to lose it all...deep down. And technically people are able to afford to lose everything. Not like their heart will stop beating if they do. But its still a terrible decision.

If you are "investing" in something that you think has a legitimate chance to go to 0 (so you lose it all) then you are not investing at all, just gambling.

 

[micawber]

23 minutes ago, scottbeard said:

If no new investors ever want any Bitcoin it just means the price stays where it is, not drops to zero like a Ponzi.

I was more commenting on the fact that BTC advocates are constantly spamming everywhere in an effort to get more people bought in. They appear to be desperate in a way that investors in other assets are not.

As you say, it can attract no one else and stay where it is. That wouldn't meet my criteria for "success". In fact it would be a failure as it lost value to inflation.

[henry the king]

28 minutes ago, scottbeard said:

But surely the price of ANYTHING only goes up if either the existing interested investors are willing to pay more for it, or you attract new investors?  You could say that of anything with finite supply, from Van Gogh paintings to shares in HSBC.

Something is only a Ponzi scheme if "returns" are paid not from an underlying investment but from the subscriptions of new subscribers, a model which will eventually fail as it is exponential in nature, at which point the investment is worth zero.

If no new investors ever want any Bitcoin it just means the price stays where it is, not drops to zero like a Ponzi.

Shares in HSBC have a value based on that companies revenue and future dividends.

No new investors means it will go down a lot. Because the fact is we are entering a global era of tight household budgets. So people will have to sell their BTC to pay their rent, mortgage, bills, etc. 

And that is why BTC is screwed long term. It is laughed at by young people.

It is a millennial scheme. No new fools coming in at the bottom now. Young people generally regard it as a total joke.

Edited June 30, 2022 by henry the king

[henry the king]

3 minutes ago, micawber said:

I was more commenting on the fact that BTC advocates are constantly spamming everywhere in an effort to get more people bought in. They appear to be desperate in a way that investors in other assets are not.

As you say, it can attract no one else and stay where it is. That wouldn't meet my criteria for "success". In fact it would be a failure as it lost value to inflation.

You see it on here. Remember a few weeks ago BTC dropped to 18k and then bounced back?

Well all of a sudden (after the bounce) you got users saying how they bought at $xk price and now were rich.

Funny how we never hear about these people buying dips prior to this and going to lose more isn't it?

Bill Gates was right on BTC.

[PrincessNutNut]

29 minutes ago, scottbeard said:

But surely the price of ANYTHING only goes up if either the existing interested investors are willing to pay more for it, or you attract new investors?  You could say that of anything with finite supply, from Van Gogh paintings to shares in HSBC.

Something is only a Ponzi scheme if "returns" are paid not from an underlying investment but from the subscriptions of new subscribers, a model which will eventually fail as it is exponential in nature, at which point the investment is worth zero.

If no new investors ever want any Bitcoin it just means the price stays where it is, not drops to zero like a Ponzi.

The value of an asset isn't in its finite supply, though, but in its added value.

The defining characteristic of a Ponzi is that the added value is a lie.

 

And if no one wants to buys something, the value is by definition zero. The price is set by the transaction.
If you can't sell something, it's worthless.

[scottbeard]

6 minutes ago, henry the king said:

Well a gambling addict is willing to lose it all...deep down.

No.  A gambling addict is someone who can't help themselves from losing it all.

5 minutes ago, henry the king said:

Shares in HSBC have a value based on that companies revenue and future dividends.

...and Van Gogh paintings (my other example, that you have ignored) have a value based upon other things, and Bitcoin has value based on yet further things.

[henry the king]

Just now, PrincessNutNut said:

The value of an asset isn't in its finite supply, though, but in its added value.

The defining characteristic of a Ponzi is that the added value is a lie.

 

And if no one wants to buys something, the value is by definition zero. The price is set by the transaction.
If you can't sell something, it's worthless.

It doesn't even have finite supply. That is another ridiculous BTC ramp idea.

There can be BTC 2.0. BTC 3.0. BTC 4.0. Which is what we see. There are thousands of these crypto currencies. 

The "dream" for these people is that companies and nations start holding their reserves in BTC.

But that is an absurd idea. Why would the UK government, which is essentially controlled by the UK people and media via democracy, decide to adopt BTC? Why would the Uk government make a decision which puts all the wealth into the hands of a bunch of crypto bros who speculated years earlier? It makes zero sense whatsoever.

[henry the king]

3 minutes ago, scottbeard said:

No.  A gambling addict is someone who can't help themselves from losing it all.

...and Van Gogh paintings (my other example, that you have ignored) have a value based upon other things, and Bitcoin has value based on yet further things.

Not all gambling addicts lose it all. And it also takes time for them to lose their maximum.

Van Gogh paintings are worth money based on the art and prestige of the art. Someone could hang that in their house and swell with pride about it, and enjoy its art. BTC doesn't even exist in the same form so it is a flawed correlation you are making for this reason

Edited June 30, 2022 by henry the king