BITCOIN

aaj123

Malthusian said:

Making a profit from Shell doesn't rely solely on convincing other people to invest in Shell.

And people investing in Shell aren't entirely relying on it to move them from the precariat to generational wealth within their working lifetime.

Really? What does making a profit from Shell depend on then? Dividends you say? But on the Ethereum thread, when it was pointed out that ETH too gets yield, then somehow the excuse shifted to stuff about asset needing to be productive and being able to give a reason that excludes both price and yield. Can we make up our mind or w just want to oppose for the sake of it?

And what does your second statement have to do with assessing an investment? Maybe Bitcoin is just seen as having much more upside than Shell. We already acknowledged that once it reaches maturity adoption, we no longer expect it to keep growing exponentially but rather to keep pace with fiat supply.

DannyCarey

Qyburn said:

That's great for people who bought during this year's low (yourself?). Not so good for people already holding the coin and suffering the loss. But I guess without those, there's nothing to fund your gain.

Here's a fun fact for you to think about, if you started to buy a mere £1 of bitcoin every single day since the absolute top, you would be in profit today.

Its interesting that you choose to focus so heavily on the cycle top, rather than zoom out at the bigger picture... 

no doubt you will be back again talking about the next all time high which has seen a drop 

Frequentlyhere

aaj123 said:

As a shareholder,  you don't get supplied tankers of fuel to your home. You as a shareholder can only profit from dividends or price increase. Your 'added value' is just play of language. On what basis do you say something 'adds value' while other things even if they do are 'shuffle of poker chips'? I could just as well say exchange of fiat paper for fossil fuel is exchanging two poker chips. 

I've found a good page here to explain this in detail: (from a site that claims and seems to actually be agnostic about crypto)

snippet: "Productive assets have a huge advantage over unproductive assets: it throws off cash. As long as society doesn’t crumble and go under, productivity gains will make owning productive assets more valuable as time goes by."

That doesn't apply to things like Bitcoin and gold, where your returns are purely dependent on whether someone else will pay more than you later.

Of course that doesn't preclude the possibility of making decent or even spectacular profits, but then you're usually at the whim of picking decent time periods. Whilst it's easy to say Gold keeps up with inflation in the long long term, it's dips and troughs, like Bitcoin, are pretty horrendous.

So maybe Bitcoin will do as well as Gold, but we're only going on 14 years of data here vs thousands of years for Gold, and for much of that time we've been pretending that Bitcoin is just about to burst out of its shell and be used as day-to-day currency. So I think there's some pretty big risks here about that assumption.

Meanwhile, why bother substantively with either when other investments are actually productive and will almost certainly work in any given medium-long term period?  The only reason I can see (why i invest a bit in gold) is that it can boost portfolio returns at weird times. That might be true for Bitcoin too, but I'm still pretty wary about various aspects.

aaj123

According to you, are shares in startups or non blue chips productive assets or not? Many of these do not have cashflows and expectation of them generating cashflows in future are also a kind of speculation.

In what sense do these qualify as investments for you given you cannot claim they will 'certainly work in any medium or long term'?

adindas

Oh Bitcoin haters. Learn the lesson .....There are bitcoin, there is also shitcoin.

Do not just listen to random people on the internet, just because they are vocal and get cheering up by the same group of people. DYOR and make your own decision ...

Frequentlyhere

aaj123 said:

According to you, are shares in startups or non blue chips productive assets or not? Many of these do not have cashflows and expectation of them generating cashflows in future are also a kind of speculation.

In what sense do these qualify as investments for you given you cannot claim they will 'certainly work in any medium or long term'?

I'd say that smaller/newer businesses would represent a higher risk level of a productive asset class. In that you could have a new business that aims to make profits from selling widgets that spectacularly fails because of an incompetent owner or a poor product

They're certainly more speculative yes, absolutely. Productive? Yes, arguably, as with all shares we're talking about future cash flows. It's just that there are far greater risks in those sorts of businesses that they'll be less productive than we'd hoped.

The difference is that some things - e.g bitcoin, gold - aren't in that game at all. They're not ever going to throw off profits as they're just not that sort of thing. 

Re: "almost certainly working" ,I think needless to say, I am not trying to imply that owning shares in any individual random startup is lower risk than holding Bitcoin/Gold.

What I mean is that there are in existence productive assets you can hold that will almost certainly work in the long term. The best examples being diversified market-tracking funds and high quality Govt. bonds.

Frequentlyhere

adindas said:

Oh Bitcoin haters. Learn the lesson .....There are bitcoin, there is also shitcoin.

Do not just listen to random people on the internet, just because they are vocal and get cheering up by the same group of people. DYOR and make your own decision ...

I'm honestly not sure what this post is in relation to. Unless it was deleted I haven't seen any recent references to non-bitcoin crypto.

aaj123

I am not sure what you have started arguing about now. You are just saying that diversified equity will produce returns in the long run. Okay but who said we were disagreeing on that. And the truth of this statement does nothing to show that Bitcoin isn't a great investment at this point due to other reasons. Cashflows (denominated in fiat) are not the be all and end all of what makes an asset valuable and a good investment. 

Why are you giving a pro-shares argument as if it's equivalent to an anti-bitcoin argument? You know, portfolios can have allocations to instruments with varying characteristics and investment thesis?

Frequentlyhere

I am not sure what you have started arguing about now.

Had to check myself frankly, it's been a while! :-) ... I was just responding to your question.

aaj123 said:

As a shareholder,  you don't get supplied tankers of fuel to your home. You as a shareholder can only profit from dividends or price increase. Your 'added value' is just play of language. On what basis do you say something 'adds value' while other things even if they do are 'shuffle of poker chips'? I could just as well say exchange of fiat paper for fossil fuel is exchanging two poker chips. 

..So no particular comment in this instance about the overall virtues of BTC or otherwise, just differentiating between productive/non-productive assets and why it's an important (but indeed not the only) factor.

Scottex99

Qyburn said:

That's great for people who bought during this year's low (yourself?). Not so good for people already holding the coin and suffering the loss. But I guess without those, there's nothing to fund your gain.

And? What about people that bought Tesla at the top, or WeWork, or a million other assets?

The market determines the gain, just like equities. I don't get why people get so fascinated with me or other holders needing people to buy from us, inferring it's some ponzi, I guess.

I've been buying for 6 years at hundreds of different prices. $19k when I first discovered it in 2017. $4k in the first major bear after that. $3k at Covid crash, $60k near the top and all the way down from there.

I believe in the asset class itself so will always buy and hold BTC & ETH. Yep there's a lot of noise, hype, scams and everything else you can imagine but I like it that way. High risk, potentially high reward