BITCOIN

HCIMbtw

Illegality - Bitcoin isn't going to made illegal, because of politics and money - It is simply a vote loser to rally against it in places like the US. They have also shown regulatory willingness to accept and recognise the assets. 

It really is a non argument. 

Sure totalitarian states can implement laws, and people can circumvent them with VPN's and such. 

Whats the value in buying it now: The asset is finite, and early adoption allows for accumulation of the asset at a cheaper price 

GME: I know people treat GME like a meme.. but it is a bit more than that I think, there is some really interesting thinking and a lot of effort goign in to try break a system of synthetic share accounting and market manipulation. I also think some of the efforts of the company to reshape to try dominate digital games markets are compelling. I don't hold any, but I sincerely wish all retailer investors the best with it. 

Either that or i'm just deluded.. 

User232002

uk1 said:

Is your position basically that you are not claiming or stating that you believe BTC to be a currency or a “traditional” investment (which you seem to be wrongly accused of believing) but simply see it as a punt or gamble more comparable with other types of bets but with this “bet” you feel able to place your bet with a personal belief of a more informed grasp of the background economic variables against which BTC might more likely perform.  So your “investment” edge is your economic knowledge and judgements about BTC’s trajectory.  Are you saying that you basically see BTC as simply being something to be bought and sold? 

I wouldn't describe it as a punt. I'm not putting the fraction of my networth that I have in to BTC that I have on a hunch. However, if you want to take this approach I think its a valid line of thinking. If I'm right, BTC goes to something absurd. If I'm wrong, BTC goes to 0. You can assign probabilities to those outcomes and calculate an expected value based on probabilistic analysis and assign an amount of your portfolio based on that. I think 1% - 5% for everyone 'as a punt' makes sense.

My background is in Mathematics really and I've been around Bitcoin for a while due to where I worked previously. I've been around some very smart people in my past and BTC is popular amongst them. I'm relatively young and affluent and think I have a good idea how people of my generation think about the markets and the world, which determines the future. I think that the majority of market participants have no actual technical knowledge about what they are discussing; people debate quantum computing and byzantine general solutions with no technical understanding of these issues. They declare Bitcoin the 'MySpace' of cryptocurrencies without being aware of HashCash or Digicash and all the previous failed iterations. Its a trend in the modern world; everyone became an expert in R numbers and epidemiology during the pandemic and then became a specialist in urban warfare when Russia invaded Ukraine. My edge is a mismash of all that, and the fact that Im immune to the volatility.

I have an amount of Bitcoin that I just never intend to sell, even if my opinion is that the immediate future over the next 6 months is down. Simply because, if I wake up tomorrow and OPEC have announced they will only sell Oil & Gas in BTC or a mid level nation adopts it as legal tender the price will go stratospheric and I'd have missed the move.

uk1 said:

Is it also your position that in simple terms the current drop in BTC value is most likely attributable to short-termism amongst more traditionalists flighting back to buy opportunities in traditional investments but that these markets are in economies where  the medicines and levers needed to “repair” economies are more likely to kill the patients than cure them and that this might inevitably lead to flight and swing back into BTC in the future.

Broadly, yes. Although, I do also think that Bitcoin cycles (Halving) aren't just a meme and a collapse of 70 or 80% was always going to happen to clear out some of these new participants.

All developed economies can raise rates to regain credibility, but this will almost certainly put those same economies in to depressions because their debt burdens can't sustain those interest rates. Or they can pivot and resume their QE, which leads to debasement and an erosion of faith / value in the currency. For me, this is win-win. In scenario one, everything goes down drastically and I would benefit from falling prices. In scenario two, Bitcoin goes up.

If you're asking me what I think will happen, then we only need to look to history. Its easier to print because its more palatable and therefore there is less resistance. Its kicking the can down the road, but the immediate problem is alleviated, so this the most likely choice. But eventually, this leads to hyper inflation of the currency, so even this has a shelf life. I think a lot of westerners can ignore currency crisis' as 'things that happen in poorer countries,' as I think you have seen ITT previously with people dismissing the power of BTC in Venezuela, Nigeria, Turkey et al. But a currency crisis in a western nation would make everyone sit up and take notice of what was going on. 

uk1

darren232002

Thanks for your patient reply.  

I am rarely in awe  of others grasp of the often cog-like relationship between stuff but you are unusually talented and I suspect that however wealthy you are today you are probably going to make a lot more and enjoy the process. “Mid-30’s”  Good grief!  

All you need  to do is to work out when you have enough and then shrug and stop.  I’ve been pretty good at that last bit  but I suspect you are a lot better than me at making money out of money. 

Bon chance.  And thanks again.  Don’t let the * get you down. 

Jeff

bugbyte_2

@uk1 / Jeff,

I agree with much of what you say and it is interesting how polarised peoples views are but you cannot discount the impact of being actively involved in BTC makes people. I don't hold it for valuation and ethical reasons and to me it is just another asset (?) which could go up or could go down. I don't have any issue if people want to hold it then good for them and I do hope as with any human being they have not lost more than they can afford to.

Regarding Darren, I appreciate the effort he puts into his posts and applaud him on his great timing - buying most of his holding at the exact bottom and avoiding buying anywhere near its peak all without a mechanism for discerning fair value - almost unbelievable but I guess law of averages someone must have done it! The problem I have with darren's arguments is (s)he makes no compensation for any view other than BTC is going to the glorious uplands, and however sensible a counter argument is made or how uncontroversial that argument is darren still argues against, usually with 'I have posted this 100 times so it must be true and you are an idiot' type statement thrown in. There is no middle ground. At least Scottx saw it for what it is - a way of making money. I do suspect that this whole argument is some kind of academic exercise to see if we can win on every point. Against that backdrop it is quite tempting to just take the micky with some of the more absurd claims such as 'BTC is green, as all energy is made from an Argentina sized chicken poo farm that you cant see on Google Maps because it is top secret' (paraphrasing. See, even if I am trying to write a sensible post it is impossible to because of the absurdity) - BTC has horrendous energy implications, why can't you just own it? 

And his posts are too long.

uk1

Thanks bugbyte_2,

I’m also not on the BTC wagon simply because I’m fortunate not to believe that I need  more in the future than I currently have and I’m even more fortunate to know/believe this and also as a person that does not cope easily with loss -  and not needing to risk  - I avoid it.  I’m in the extreme minority situation of having had my liquidity all in cash and has been for a very long time and the loss against what I might have made is of absolutely no concern to me. 

I know that Darren needs no advocate in me but my contra view is that his standpoint is from a apparently narrow minority view of having what he feels is a cogent fact based reasoning of his position from what has seemed to me from rather aggressive opposition.  Some of the opposition seems rather needlessly nasty to be honest.  It is much easier to be short and pithy and relatively content-free than it is to methodically put forward detailed rebuttal.  He has a very wide contextual view that I find interesting and provocative even if I do not necessarily agree with every conclusion. 

Much of the rebuttal of his rebuttals do seem a content free to me but then what do I know?!  

I think - and you seem to be in the same spirit - that it is possible to disagree and be respectful but it seems not everyone agrees. 

Jeff

bugbyte_2

uk1 said:

Thanks bugbyte_2,

I’m also not on the BTC wagon simply because I’m fortunate not to believe that I need  more in the future than I currently have and I’m even more fortunate to know/believe this and also as a person that does not cope easily with loss -  and not needing to risk  - I avoid it.  I’m in the extreme minority situation of having had my liquidity all in cash and has been for a very long time and the loss against what I might have made is of absolutely no concern to me. 

I know that Darren needs no advocate in me but my contra view is that his standpoint is from a apparently narrow minority view of having what he feels is a cogent fact based reasoning of his position from what has seemed to me from rather aggressive opposition.  Some of the opposition seems rather needlessly nasty to be honest.  It is much easier to be short and pithy and relatively content-free than it is to methodically put forward detailed rebuttal.  He has a very wide contextual view that I find interesting and provocative even if I do not necessarily agree with every conclusion. 

Much of the rebuttal of his rebuttals do seem a content free to me but then what do I know?!  

I think - and you seem to be in the same spirit - that it is possible to disagree and be respectful but it seems not everyone agrees. 

Jeff

Fair points but when every point is rebutted regardless of the strength of the argument it stops being a conversation and descends into a win at all costs. At this point any valid points that are made are lost in a need to attempt to counter every single comment made. As an outsider who does not have a horse in this race but could be convinced, this along with a condescending attitude just drives people the other way.

Some time ago Darren asked what would be needed to be proven wrong, so I replied quite honestly with the hurdles that would need to be overcome for me to find BTC acceptable. What came back was an essay on why my opinion was nil and void which is interesting because if he really did know his stuff he would come back with an understanding of why there are issues and what is being done (if anything) to counteract them. Just look at the systematic dissection of FrequentlyHere's post above - no recognition at all, just complete denial. Take for example:

Frequentlyhere said:

It's not becoming less volatile, it's becoming more.

Again, this is your perception. It is however factually incorrect. Volatility is math, it doesn't care what your perception is.


So am I to believe that standard deviation, beta, et al would show that BTC is stable, and its just my perception it drops and rises by 10's of percent? Note Darren introduced the word 'perception' - not FH - then used it as a negative towards him. This happens a lot.

I am sure the same happens from the other side - Bro's could claim the same thing, hence why this discussion often falls into insults. 

bugbyte_2

In other news BTC is clearly bouncing on top of the $20K psychological floor. If it dips below this it could herald more carnage. 

User232002

bugbyte_2 said:

Some time ago Darren asked what would be needed to be proven wrong, so I replied quite honestly with the hurdles that would need to be overcome for me to find BTC acceptable. What came back was an essay on why my opinion was nil and void which is interesting because if he really did know his stuff he would come back with an understanding of why there are issues and what is being done (if anything) to counteract them. 

Is this the time when you said you would consider Bitcoin a success if you could pay for coffee with it? The general point I made in rebuttal was that this isn't something I want to happen, nor consider likely. Its preposterous to say that you'll consider your son/daughter a success when they appear on Broadway if they have no interest in musical theatre...

Take a block of Gold in to your local Starbucks and see if they will sell you a coffee for it.

bugbyte_2 said:

Frequentlyhere said:

It's not becoming less volatile, it's becoming more.

Again, this is your perception. It is however factually incorrect. Volatility is math, it doesn't care what your perception is.


So am I to believe that standard deviation, beta, et al would show that BTC is stable, and its just my perception it drops and rises by 10's of percent? Note Darren introduced the word 'perception' - not FH - then used it as a negative towards him. This happens a lot.

Of all the things to pick in the previous post, this really isn't the one you should have picked. Do you understand what SD is or have you just heard of the concept? Do you have any experience in building probabilistic models or using regression analysis in things like MATLAB? Any experience in using different probability distributions other than the normal distribution? Have you at least done a basic GCSE or A Level SD calculation from a raw data set and understood where the calculations are coming from, ie. Could you explain why we square the distance from the mean (without looking it up)?

Standard deviation is a calculation and calculations are impartial. You can argue all you want that 2 + 2 = 5, but this doesn't make you correct. I also need to emphasise that the original argument was that Bitcoin volatility was decreasing over time, not that Bitcoin was stable. Here is a chart of Bitcoin volatility over time;



How would you describe the progression of the black line? It seems pretty clear that a moving average of this line would be trending down over time. Your perception is based on your emotions and beliefs, but volatility is a mathematical quantity. Whether you think, feel or have an opinion about it is irrelevant if the number can be patently shown to be decreasing.

Here is option IV and 30 day vol (Gold vol included for context before anyone misunderstands why the line looks like it does)






Do any of these graphs look like they are trending up to you? Not to mention the original assertion was that the current volatility is higher than it has been in the past, yet you can see that the current volatility is some way below historical volatility peaks.

Just for laughs, I left in the Bitcoin price on a couple of the graphs so we can all see how it has been 'crashing' so hard recently...

bugbyte_2 said:

Regarding Darren, I appreciate the effort he puts into his posts and applaud him on his great timing - buying most of his holding at the exact bottom and avoiding buying anywhere near its peak all without a mechanism for discerning fair value - almost unbelievable but I guess law of averages someone must have done it! 

I have never said I bought the bottom and I've been pretty consistent since I started posting here on exactly when I acquired the majority of my position. I also bought BTC at $250 in 2014 and then promptly sold it for basically zero profit. I use these because I think the covid bottoms of both markets provide a good reference point for analysis. 

bugbyte_2 said:

The problem I have with darren's arguments is (s)he makes no compensation for any view other than BTC is going to the glorious uplands, and however sensible a counter argument is made or how uncontroversial that argument is darren still argues against, usually with 'I have posted this 100 times so it must be true and you are an idiot' type statement thrown in. There is no middle ground. 

I'm at a level in my life where I'm not going to tolerate poor thinking or be polite about it. You've literally just attempted to argue that a calculation gives a conclusion completely opposite to the one it actually does. This isn't a 'sensible counter argument' or a valid viewpoint. Its just completely incorrect.

bugbyte_2 said:

Against that backdrop it is quite tempting to just take the micky with some of the more absurd claims such as 'BTC is green, as all energy is made from an Argentina sized chicken poo farm that you cant see on Google Maps because it is top secret' (paraphrasing. See, even if I am trying to write a sensible post it is impossible to because of the absurdity) - BTC has horrendous energy implications, why can't you just own it? 

ESG investors like to believe they are doing the right thing based on a simplistic narrow view of the situation; unfortunately it is rarely correct. Although it feels good, it isn't an actual solution. You might wish to watch these two videos;

https://youtu.be/AW3gaelBypY

https://youtu.be/euhnX5iprSg 

TL;DR: Carbon offsets/credits are based on faulty accounting. They allow companies to pretend to be good for the environment because they purchase offsets rather than reduce emissions (Airlines at 100% 'renewable energy' lolz). Estimates and co-benefits predicted by carbon reduction programmes don't happen in reality. Ethical investing is bad investing. Its undiversified compared to an index. Game theory means that ulterior motives, however noble, in markets where making money is the primary motivation will put you at a disadvantage.

This kind of flawed thinking is what I see everywhere amongst ESG investors. Its why they hate BTC so much because 'emissions are bad,' without actually looking at how renewable energy is financed and utilised.

bugbyte_2 said:

And his posts are too long.

The exposition of nuance and technical knowledge takes time.

Zola.

Things I admire most in our Darren

- He is a Bitcoiner
- He has relentless energy and patience to answer in detail the same FUD that comes up ad nauseam 

fwor

darren232002 said:

The exposition of nuance and technical knowledge takes time.

And, as you can see, he is also a master of condescension.

Surely Darren232002 blew any credibility that he might have had here by writing this:

darren232002 said:

People aren't buying Bitcoin to get rich, they are buying it because its a fairer system.

Yes, of course - we all know that the spectacular rise in the price of Bitcoin was nothing to do with people wanting to get rich quick...