BITCOIN

User232002

Cus said:

If bitcoin stayed around £30k (+/- 50%) for the next 10 years, i.e became a very stable gold alternative,  do you think that the top grad brains will be drawn to it, and would it be as successful in helping with monetary stability across a number of smaller countries?

Well, +/- 50% isn't very stable. For the grads, it really is about both the money (an entry smart contract programmer is on $100k minimum as a remote work gig, plus the alpha you get from being in this space) as well as the permissionless and idealistic nature of the work. Your typical grad job is 2-5 years of mind numbingly boring work with no real responsibility or autonomy whilst being subservient to someone that is probably incompetent and largely there because they are just 20 years older than you. In contrast, just this week someone created a decentralised copy of OpenSea (NFT trading platform currently valued at around $10-$15B by the equity market) with lower fees and with a token that takes all those fees and gives them back to the users of the platform. Further, there are plenty of anonymous people in this space which means its entirely meritocratic. If you have a cool idea, there are plenty of treasuries with billions giving out grants for people to build stuff and you can apply to them as an anonymous person with a cartoon ape as your profile picture - discrimination is lower, creativity goes up. Google attracted talent and became the company it is today partly because it offered awesome salaries and partly because it gave employees one day off a week to work on whatever they wanted; crypto is doing that on a colossal scale.

As to the stability, BTC for smaller countries is a double edged sword. Its not something that people should be putting money in to that they need in 1 or 2 years because they will just get washed out by the volatility and capitulate. However, its a great tool for pension funds who have long investment horizons and I think it probably eventually replaces bonds in some part of their 60/40 portfolio. Its been interesting to see that hedge funds have largely been moving in and out of BTC because they don;t really accept it yet, whereas the pension funds that have bought it tend to be more willing to be here for the longer term. For these countries though, USD stablecoins are a far better alternative than their own currencies and these are essentially enabled by things like BTC. 

Cus said:

Take away the hopes of massive financial gains etc and does its impact change? Is greed too much of a part of this? (not trolling, interested in people's perspective, particularly people employed in the industry.)

I can only speak for myself and what I see, but I don't see much greed in this space because of the projects I associate myself with. If you buy things like DOGE, SAFEMOON or SHIB then you're going to get pictures of rocket emoji's and number go up stuff, but generally BTC, ETH and many others seem more idealistic and wanting to build a better, fairer world. If we look at projects that do well, it tends to be because they have strong communities. I have been in NFT discord groups where all anyone cared about was the current price and these projects tend to completely disintegrate shortly after launch because the buyers just want an influencer to pump their bags so they can sell at a profit. When this doesn't happen, such a community turns on itself very quickly. In contrast, I joined a DAO a couple of weeks ago and I haven't seen a single post about price in the discord yet and people are just focused on building something. I imagine that will do very very well because the project will be owned by people that truly care about it rather than those that are looking to flip for a quick profit. 

Cus said:

I suspect that the next few years it will be the attempt of the institutions to relieve the retail users of their bitcoin but at lower prices, and then once they have more control, the price will go up as they sell it back to retail at the higher price.  They do that with everything else 😁

I agree with this. I definitely think the final stage is when banks and such are selling BTC linked savings accounts or such to the retail class that spent 20 years saying that BTC was a ponzi. 

Zola.

darren232002 said:

Cus said:

If bitcoin stayed around £30k (+/- 50%) for the next 10 years, i.e became a very stable gold alternative,  do you think that the top grad brains will be drawn to it, and would it be as successful in helping with monetary stability across a number of smaller countries?

Well, +/- 50% isn't very stable. For the grads, it really is about both the money (an entry smart contract programmer is on $100k minimum as a remote work gig, plus the alpha you get from being in this space) as well as the permissionless and idealistic nature of the work. Your typical grad job is 2-5 years of mind numbingly boring work with no real responsibility or autonomy whilst being subservient to someone that is probably incompetent and largely there because they are just 20 years older than you. In contrast, just this week someone created a decentralised copy of OpenSea (NFT trading platform currently valued at around $10-$15B by the equity market) with lower fees and with a token that takes all those fees and gives them back to the users of the platform. Further, there are plenty of anonymous people in this space which means its entirely meritocratic. If you have a cool idea, there are plenty of treasuries with billions giving out grants for people to build stuff and you can apply to them as an anonymous person with a cartoon ape as your profile picture - discrimination is lower, creativity goes up. Google attracted talent and became the company it is today partly because it offered awesome salaries and partly because it gave employees one day off a week to work on whatever they wanted; crypto is doing that on a colossal scale.

As to the stability, BTC for smaller countries is a double edged sword. Its not something that people should be putting money in to that they need in 1 or 2 years because they will just get washed out by the volatility and capitulate. However, its a great tool for pension funds who have long investment horizons and I think it probably eventually replaces bonds in some part of their 60/40 portfolio. Its been interesting to see that hedge funds have largely been moving in and out of BTC because they don;t really accept it yet, whereas the pension funds that have bought it tend to be more willing to be here for the longer term. For these countries though, USD stablecoins are a far better alternative than their own currencies and these are essentially enabled by things like BTC. 

Cus said:

Take away the hopes of massive financial gains etc and does its impact change? Is greed too much of a part of this? (not trolling, interested in people's perspective, particularly people employed in the industry.)

I can only speak for myself and what I see, but I don't see much greed in this space because of the projects I associate myself with. If you buy things like DOGE, SAFEMOON or SHIB then you're going to get pictures of rocket emoji's and number go up stuff, but generally BTC, ETH and many others seem more idealistic and wanting to build a better, fairer world. If we look at projects that do well, it tends to be because they have strong communities. I have been in NFT discord groups where all anyone cared about was the current price and these projects tend to completely disintegrate shortly after launch because the buyers just want an influencer to pump their bags so they can sell at a profit. When this doesn't happen, such a community turns on itself very quickly. In contrast, I joined a DAO a couple of weeks ago and I haven't seen a single post about price in the discord yet and people are just focused on building something. I imagine that will do very very well because the project will be owned by people that truly care about it rather than those that are looking to flip for a quick profit. 

Cus said:

I suspect that the next few years it will be the attempt of the institutions to relieve the retail users of their bitcoin but at lower prices, and then once they have more control, the price will go up as they sell it back to retail at the higher price.  They do that with everything else 😁

I agree with this. I definitely think the final stage is when banks and such are selling BTC linked savings accounts or such to the retail class that spent 20 years saying that BTC was a ponzi. 

A really good point sir.

Linkedin says Bitcoin and crypto jobs grew 395% in 2021 - 3x the tech industry...

Zola.

https://www.cityam.com/crypto-company-bitmex-makes-bid-for-one-of-germanys-oldest-banks/

Bitmex buying up one of Germany's largest and oldest banks, presumably for Bitcoin custodial services. 

Aegis

AlexBacker said:

guys, is it a good time to buy btc?

Great question, and one you should ask before buying any investment.  The question is of course otherwise translates as "will the value likely be higher when I come to sell?"  If your research convinces you that the answer is "yes", then it can be a good time for a purchase, if the answer is "no" then it doesn't seem like a good idea unless you have some other reason to invest (e.g. with shares you might be buying for a high dividend).  As such, the questions you need to think about are "why will the price increase?", "where will the increase in value come from?", "why aren't more people buying now, what do they know that I perhaps don't?", "why has the price dropped recently?" and my favourite "is the current price representative of fair value?"

My opinion is that there's no reason for me to buy bitcoin other than the fact that it historically has performed well.  I struggle to identify the rationale behind the change in value between now, the all-time high and, say, 5 years ago.  If you can find out any reason other than mania, I'd genuinely love to hear it, but I remain concerned that this is just another example of tulip mania.  If you haven't heard of that before, it's worth looking up.

Scottex99

Mania isn’t going to last for 12 years is it? And if it’s true mania once it crashes hard which BTC has done multiple times, it’s not going to recover and make new highs, every time.

I bought some this morning but I buy it all the time. From an ATH of $69k, buying the dip looks like a decent idea. But not with money you can’t afford to lose, you may wake up tomorrow and you’ve lost 30% of your investment, not financial advice yada yada

Zola.

AlexBacker said:

guys, is it a good time to buy btc?

If you have studied Bitcoin, learn what its actually about from a value proposition to the world (think especially about developing nations, there are billions of people working with weak, inflating currencies and no bank access), understand on a semi- technical level how it works and why it works like that, understand that it is the one truly decentralised asset (as it was allowed to grow organically without a CEO interfering or hoarding a massive pre-mined stash for themselves and their mates), that will give you an indication if you want to buy it. Learn about the bitcoin halving, why they matter, cycle patterns etc.

If you miss the 10 best days of a bitcoin pump in any year you basically miss the rocket and all of the gains. 

So if you believe in the long term viability of such open source technology (something of which the world has never seen until now), then yes its a good time to buy and hold, if you can stomach the ups and downs. But you have to be prepared to hold it for 4 years as a minimum, like most investments. The next halving is in around 800 days time, and up to now the best gains generally come one year after, so now could be a very good accumulation time..

If you want to merely gamble or make a very quick trade, its probably not the right product for you nor an ideal time. It could go down further, it could be a very dull sideways motion until the next halving, or a rocket... theres a lot of FUD battles going on and nothing is certain. Bitcoin does its own thing and rewards patience. 

For me it makes up a small part of my portfolio, but I believe it can become a very important and contributing wealth builder in about 5-10 years time. 

Aegis

Scottex99 said:

Mania isn’t going to last for 12 years is it? And if it’s true mania once it crashes hard which BTC has done multiple times, it’s not going to recover and make new highs, every time.

Where have you sourced these rules from?  There's no reason why a mania can't last a long time, and there's absolutely nothing saying that once an asset crashes, it can't have been in a mania if it then rises again, nor is it a hard and fast rule that bubbles always burst with major .  Looking at this from investopedia:

What Is a Bubble?

A basic characteristic of financial bubbles is the suspension of disbelief by most participants when the speculative price surge is occurring: It's only in retrospect, after the bubble has burst, that they're recognized (to many an investor's chagrin).

...

Bubble, in an economic context, generally refers to a situation where the price for something—an individual stock, a financial asset, or even an entire sector, market, or asset class—exceeds its fundamental value by a large margin.

In the case of bitcoin and most other crypto assets, there doesn't appear to be any fundamental or intrinsic value, the the price must by definition exceed the fundamental value by a large margin.  I don't see how this could be anything other than a bubble/mania.

And yes, I know that the article says that once a bubble bursts it won't reinflate, but that is very definitely not the same as saying that an asset can't crash in value during the boom and euphoria stages of bubble formation.

Scottex99

I haven't sourced them from anywhere, it's common sense.

When the asset itself passes 1tn in value, the price crashes in an extreme manner, multiple times but always recovers to a new high, the largest companies and banks in the world are putting it on their balance sheets or helping their clients get exposure to it.

Then there probably is intrinsic value (which is a myth anyway) whether you can see it or not.

The guy is asking if its a good time to buy, he's going to be told yes or no, by various people. 

Lets leave the boring tulip chat from 400 years ago out of it for once 

HCIMbtw

I started buying last year, hold BTC, SOL, ETH. I try not time the market, so DCA each week. Has prevented me losing circa 40%, currently about 15% down which isn't terrible considering I pretty much started at ATH. 

I have pretty high conviction and have been working towards 10% allocation of my non pension/property based assets, quite happy if price goes down as I buy cheaper and I will continue to DCA.

Maybe I've been orange pilled, but I really doubt I have and I listen to the arguments against as well as for. I actually think it is far more sensible to have some exposure rather than no exposure. I keep a close eye on general industry news, particularly related to SOL/ETH to make sure I am not missing anything important that might change my mind about the future of these investments.. as SCP platforms their success is dependent upon performance, adoption and development to a greater extent that BTC is. If I withdraw from ETH/SOL it will be into BTC. 

I really can't see BTC going to less than $33k dollars, and I think with that as a floor getting in at this price is fantastic asymmetric opportunity. No guarantees it will ever go back to that price. Increasing adoption gives it fantastic upside potential though, which for me makes it worth it. 

NB - Based on what I am investing I can afford to be wrong. InvestAnswers on youtube is my general go to for news/updates, he does a fantastic job summarising a lot of information and I listen on the drive to work. His style is a bit weird and presentational, but i'd recommend checking the channel out if anyone is interested in content from somebody independent of affiliations. He also does a fantastic job relating the opportunity to macro economics. 

Aegis

Scottex99 said:

I haven't sourced them from anywhere, it's common sense.

When the asset itself passes 1tn in value, the price crashes in an extreme manner, multiple times but always recovers to a new high, the largest companies and banks in the world are putting it on their balance sheets or helping their clients get exposure to it.

Then there probably is intrinsic value (which is a myth anyway) whether you can see it or not.

The guy is asking if its a good time to buy, he's going to be told yes or no, by various people. 

Lets leave the boring tulip chat from 400 years ago out of it for once 

Sorry, but "common sense" has no place in investment decisions.  Data is far more important, and a lot of people end up making very poor investment decisions purely by relying on common sense, e.g. selling after a loss to limit risk - it might make sense, but it's not a good investment strategy.  Nothing I've seen in years of advising and investing has led me to believe that something can't crash in value and recover as part of bubble behaviour.  The one commonality of all bubbles is that they have ultimately been irrational in hindsight, but presumably well justified by investors at the time.

Also, your claim of intrinsic value "probably" being there is immediately dismissable with knowledge of what intrinsic value genuinely means, which is effectively what it generates in income compared to that of a risk-free asset, or what it can be used for.  I regularly invest in stuff that, by this definition, doesn't have intrinsic value now, but the goal is that the investments will build that intrinsic value in time by developing intellectual property or working out a manufacturing process that they can use to create something there is demand for.  Bitcoin in particular does absolutely nothing (in terms of economic activity of the token itself, not ownership of the token), and in 5 years each bitcoin will still do absolutely nothing.  There's no ownership of the underlying technology, no way to monetise the intellectual property associated with blockchain (not necessarily the same can be said for all crypto assets), in short no way to make money other than selling to someone else for a higher price, which like it or not is what Greater Fool Theory is all about.

I mention tulips because it's a good example of mania.  If you find it boring, you certainly don't need to read up on the subject at all, but I and some others genuinely find it interesting to see the herd mentality that drove tulip investors and try to work out why on earth they made the decisions they did.

Finally, I'm not going to tell him yes or no, because I genuinely don't know whether the price will surge upwards for years or collapse down towards zero, or something between the two.  This is down to the fact that I have no way of working out any form of fair value for bitcoin, or any other cryptocurrency for that matter.  If he reads everything and comes to the conclusion that it's the right time to buy, then as I've said before, it's his money, he can ultimately buy what he wants as long as it's legal.