BITCOIN

HCIMbtw

Aegis said:

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.

I understand your argument with regard to intrinsic value of BTC. However, I would argue many smart contract platform style crypto assets (e.g. ETH/SOL) have pretty clear intrinsic value in allowing network operation. These layer one chains have a wide range of apps and systems operating on their network. The asset is integral to functionality. 

I personally find these riskier though, because they are obviously replaceable as networks if they are outperformed/outcompeted. 

For me BTCs biggest strength is its finite supply, level of adoption, and function as cash (not currency) for transacting with no intermediary. If you get your head around the macroeconomics of FIAT and don't see the value in this, then id encourage anyone to take a look at the economics of FIAT again. 

There is potential for the BTC blockchain to provide far greater functionality in the future, which could be deemed to give it clearer intrinsic value, but I don't need it to have that. 

Zola.

HCIMbtw said:

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. 

I like James also, although I generally turn off when he pumps so many alts. 

Aegis

HCIMbtw said:

Aegis said:

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.

I understand your argument with regard to intrinsic value of BTC. However, I would argue many smart contract platform style crypto assets (e.g. ETH/SOL) have pretty clear intrinsic value in allowing network operation. These layer one chains have a wide range of apps and systems operating on their network. The asset is integral to functionality. 

I personally find these riskier though, because they are obviously replaceable as networks if they are outperformed/outcompeted. 

For me BTCs biggest strength is its finite supply, level of adoption, and function as cash (not currency) for transacting with no intermediary. If you get your head around the macroeconomics of FIAT and don't see the value in this, then id encourage anyone to take a look at the economics of FIAT again. 

There is potential for the BTC blockchain to provide far greater functionality in the future, which could be deemed to give it clearer intrinsic value, but I don't need it to have that. 

Yep, there are some networks where the value seems more readily calculable, though my worry there is that the value of the conversion is often only a tiny fraction of what the asset is traded for (which demonstrates bubble behaviour).

The comments about fiat currency are why I hold as little currency as possible.  Inflation is an often insidious enemy of cash, but the idea of going from cash to a highly volatile asset class that I'm worried is subject to a widespread mania at the moment just doesn't seem rational to me.  Instead I generally hold equities because those provide actual ownership of the underlying profits and intellectual property of the companies in question, so the value comes from utilising those assets to generate cash flow.

With regard to intermediaries, they give me security (FCA or FSCS access) and in many cases rewards as well (e.g. my Amazon credit card).  As such, the existing system already adds value for me when it comes to making transactions via an intermediary, which I don't feel I would get by using a different medium of exchange.

spnego

The intrinsic value is the network itself. 
A secure network for sending money anywhere in the world for low cost where creating a bitcoin takes an amount of energy to produce.
There is intrinsic value locked up in the internet but tcpip wasn't monetised so you cant earn money in the underlying protocol from people using the internet.

Scottex99

Aegis said:

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.

Ok, so what if my common sense tells me to buy more when the market is down, lowering my average cost. Is that common sense that's allowed in investment decisions?

I find the tulip thing boring because its been brought up about 20 times in this thread already. 

Bitcoin does indeed do nothing, as does gold or silver but people still like to hold it and trade it. And the potential merits of ownership and "expected" increase in value have also been discussed many times.

If you don't see them that's fine but you not need to keep writing essays about "data". You could just go to the equities thread or the where can I put my savings and make 0.78% threads and post there. Leave the crypto people to it?

It's a Bitcoin thread after all, you dont need to comment every 3 posts saying you dont get it or believe in it. Better yet, short it, or short the whole crypto market. At least that would be a good use of your time (and mine).

Most people that are pro crypto are in it because they like the risk, kind of like trading stocks but on steroids. They like the tech, they like the anti bank narrative, they like decentralisation, they like the idea of controlling their own wealth (in whatever form), they like innovation, they are excited about what's being built etc etc etc.

I don't care what the data says about fair value, it's done ok for me so far, and if I end up on the end of some bad numbers then so be it, that's on me, we're all adults here

Zola.

A quick search on old bitcoin posts here shows that Aegis has been vocal against Bitcoin since 2017, back when Bitcoin was a mere £5000. 

In that time since, it has gone as high as £65,000 and "crashed" to £31,000 where we are now.
5 years on, still shown to not understand how Bitcoin actually works or the value proposition still... is ... interesting. 

I am just curious, at what price point will you stop and consider that you might be wrong @Aegis ?  £100,000? £200,000? 

Or in five years time will you keep digging the heels in, chime in every few posts with the same repetitive questions about fair value, intrinsic value, tulips etc, not read any links or video links that are sent, repeat FUD and take it to the grave that Bitcoin is worthless? Even if it costs you a potential fortune? 

Aegis

Zola. said:

A quick search on old bitcoin posts here shows that Aegis has been vocal against Bitcoin since 2017, back when Bitcoin was a mere £5000. 

In that time since, it has gone as high as £65,000 and "crashed" to £31,000 where we are now.
5 years on, still shown to not understand how Bitcoin actually works or the value proposition still... is ... interesting. 

I am just curious, at what price point will you stop and consider that you might be wrong @Aegis ?  £100,000? £200,000? 

Or in five years time will you keep digging the heels in, chime in every few posts with the same repetitive questions about fair value, intrinsic value, tulips etc, not read any links or video links that are sent, repeat FUD and take it to the grave that Bitcoin is worthless? Even if it costs you a potential fortune? 

Yep, I could be wrong, no question.  That's why I keep asking questions - if I genuinely think I was wrong, then I will reassess whether it makes sense for me to buy in at some point.  I still haven't seen any reason to suggest that the price rise is anything but a bubble, though.

Also, it won't cost me a penny.  Opportunity cost is not real cost, so there's zero chance at the moment that bitcoin will cost me a fortune.

And no, I haven't been "shown" to not understand how bitcoin works.  All that's been shown is that I don't buy in to the same hype as everyone positive about this asset.

Aegis

Scottex99 said:

Aegis said:

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.

Ok, so what if my common sense tells me to buy more when the market is down, lowering my average cost. Is that common sense that's allowed in investment decisions?

I find the tulip thing boring because its been brought up about 20 times in this thread already. 

Bitcoin does indeed do nothing, as does gold or silver but people still like to hold it and trade it. And the potential merits of ownership and "expected" increase in value have also been discussed many times.

If you don't see them that's fine but you not need to keep writing essays about "data". You could just go to the equities thread or the where can I put my savings and make 0.78% threads and post there. Leave the crypto people to it?

It's a Bitcoin thread after all, you dont need to comment every 3 posts saying you dont get it or believe in it. Better yet, short it, or short the whole crypto market. At least that would be a good use of your time (and mine).

Most people that are pro crypto are in it because they like the risk, kind of like trading stocks but on steroids. They like the tech, they like the anti bank narrative, they like decentralisation, they like the idea of controlling their own wealth (in whatever form), they like innovation, they are excited about what's being built etc etc etc.

I don't care what the data says about fair value, it's done ok for me so far, and if I end up on the end of some bad numbers then so be it, that's on me, we're all adults here

"Buy low, sell high" is an old saying rather than just common sense, and it has its origin in sound mathematical principles, i.e. that if you buy at a lower price than you sell, the difference is profit.  Averaging down the cost of an investment is hardly new either, though this is less sound - I remember watching people bragging about how many Northern Rock shares they were buying at a huge discount when it had fallen around 90% in value.  The corollary to this is "don't try to catch a falling knife", indicating that there are certainly reasons why buying after a loss might not be a sound strategy.

Gold and silver are both used in industry and jewellery.  There's a premium to pay because they are seen as precious metals, but that premium tends to be predictable in the very long term.  In other words, both have underlying utility.  Nevertheless, I don't include them in my investment portfolios because they don't satisfy the requirement of either generating revenue or being likely to develop something that generates revenue.  So yes, people trade these, but I have argued for years that it's a bad idea.  If my first criticism of bitcoin on this forum was in 2015, it wouldn't surprise me to hear that my first criticism of gold was almost a decade before then.  My investment philosophy remains much the same, I've just been able to buy more because technology has improved and my pensions over the years have allowed me to grow my pot to large enough that I can now look at individual equities, while right back in the day I needed to rely on unit trusts and OEICs for the most part.

No, I won't "leave you to it".  You can always block me if you're fed up with me participating, but I feel it's necessary to be the balance to the highly positive positions. If you don't like that, you'll need to ask the admin team to ban me from this thread, otherwise it's a free forum and I'll continue to participate in the topics that interest me.

No, I also won't short the market.  Another saying is that "the market can be irrational far longer than you can be solvent", so I could be 100% correct and still end up bankrupt because of timing.  I'm not willing to take that risk.  On top of that, I wouldn't even know where to short something like bitcoin where I was actually confident in their ability to pay out any owed funds.  Genuinely it seems like my entire point is being missed here, in that I have no idea whether the price will continue upwards for years or crash to near-zero next week, or anywhere in between, and neither does anyone else.

You might well not care about fair value, that's entirely your choice.  Others who are more naive may well not know this concept and think that market value is all that matters.  If they read my comments and questions and decide that they still want to invest, then again, it's their money, I couldn't stop them even if I wanted to.  The fact is, if the investment case for bitcoin and other crypto assets is so strong, then it should stand up to questioning.  If it doesn't, then it is doomed to fail.

Scottex99

Fair value argument conveniently gets you off the hook regardless of how high the BTC price goes. I wish I’d known about it in 2015 as I’d be 2 years further down the rabbit hole and considerably richer (less important).

If you read the whole 160 pages again you’ll see you’re not offering any balance, you’re just repeating the same arguments that all nocoiners do about how blockchain can’t be with anything because there’s no company and no dividend. You’re not actually a MSE superhero protecting the naive from reading one Bitcoin post and throwing 90% of their liquid wealth into crypto because 1. That wouldn’t happen and 2. People that stupid will be parted with their money regardless.

I don’t need to block you but I could easily waste less time on here, maybe I’ll go hang out in the Metaverse instead 👍

Aegis

Scottex99 said:

Fair value argument conveniently gets you off the hook regardless of how high the BTC price goes. I wish I’d known about it in 2015 as I’d be 2 years further down the rabbit hole and considerably richer (less important).

If you read the whole 160 pages again you’ll see you’re not offering any balance, you’re just repeating the same arguments that all nocoiners do about how blockchain can’t be with anything because there’s no company and no dividend. You’re not actually a MSE superhero protecting the naive from reading one Bitcoin post and throwing 90% of their liquid wealth into crypto because 1. That wouldn’t happen and 2. People that stupid will be parted with their money regardless.

I don’t need to block you but I could easily waste less time on here, maybe I’ll go hang out in the Metaverse instead 👍

I'm not on the hook, remember, I'm not invested.  The price can go to literally any level and it will have no impact on me whatsoever (unless someone changes my mind and makes the investment case for bitcoin clear to me, which at this point seems unlikely).

Of course I'm offering balance, I'm literally asking the questions that, if answered, would show whether an investment is worthwhile or not.  I've never claimed to be a superhero, just an interested investor with enough empathy to want to share some of the experience I've had over the years both personally and professionally.  And yes, there are definitely people out there who will throw the vast majority of their money at bitcoin because they've read a few good things about it, and some of them might well not proceed because they ask the same questions and get the same answers.

I don't know about you, but if I see someone drop a £20 note, I'll usually pick it up and give it back to them.  I'm not a fan of the idea that they should lose their money because they weren't safe enough with it to keep it secure, same with investments.  I will happily try and help people that are "that stupid" if I can, not to make a specific decision but to help them learn how to make better investment decisions on their own, most of which is a case of asking the right questions..