Bitcoin

Thrugelmir

[Deleted User] said:

Thrugelmir said:

patient_investor said:

thegentleway said:

[Deleted User] said:

Where are those naysayers who religiously were saying bitcoin is not an investment?

Well, it is.

https://deloitte.wsj.com/cfo/2021/03/02/does-bitcoin-belong-on-your-balance-sheet/

I’m still here 🤣 Bitcoin is gambling. It’s purely speculative so can’t be compared to traditional investments. Hope it does well for you and makes you lots of money. 

Long time no see Problem is, it's being compared to traditional investments and put on to portfolios regardless. Nothing is stopping people, businesses and wealth managers from putting it into portfolios and making a killing. The horse has left the barn. Once bitcoin hard money features and other characteristics, including average gains year on year has been seen, they can't be unseen.

Barn doors can be slammed shut. Then the poor horses will be left to fend for themselves. 

You must be referring to saddened nocoiners and naysayers then, who have been left empty handed?

New internet meme-saying to them has been lately: "Have fun staying poor". 

Nah.  Nothing in this world is for free. Takes two to trade. Has to be a loser. That's how the games work. Nothing better than sheer greed to bring out the worst in people. In the race to get rich quick. 

[Deleted User]

Thrugelmir said:

[Deleted User] said:

Thrugelmir said:

[Deleted User] said:

thegentleway said:

[Deleted User] said:

Where are those naysayers who religiously were saying bitcoin is not an investment?

Well, it is.

https://deloitte.wsj.com/cfo/2021/03/02/does-bitcoin-belong-on-your-balance-sheet/

I’m still here 🤣 Bitcoin is gambling. It’s purely speculative so can’t be compared to traditional investments. Hope it does well for you and makes you lots of money. 

Long time no see Problem is, it's being compared to traditional investments and put on to portfolios regardless. Nothing is stopping people, businesses and wealth managers from putting it into portfolios and making a killing. The horse has left the barn. Once bitcoin hard money features and other characteristics, including average gains year on year has been seen, they can't be unseen.

Barn doors can be slammed shut. Then the poor horses will be left to fend for themselves. 

You must be referring to saddened nocoiners and naysayers then, who have been left empty handed?

New internet meme-saying to them has been lately: "Have fun staying poor". 

Nah.  Nothing in this world is for free. Takes two to trade. Has to be a loser. That's how the games work. Nothing better than sheer greed to bring out the worst in people. In the race to get rich quick. 

How come investing 1% of your portfolio in Bitcoin can get you rich quick? This is called diversification. Serves as inflationary hedge as well. Reports by major banks research groups and other entities actually discovered that risk adjusted returns are better while maintaining same volatility. Have you actually read the reports people post here in this thread?

underground99

[Deleted User] said:
How come investing 1% of your portfolio in Bitcoin can get you rich quick? This is called diversification. Reports by major banks research groups and other entities actually discovered that risk adjusted returns are better while maintaining same volatility. Have you actually read the reports people post here in this thread?

The major financial institutions which have recently established 'digital assets' divisions would like to grow that business to receive more fee income from it. Their marketing departments are happy to publish reports showing that if you had introduced 1-3% bitcoin into a traditional 60/40 portfolio and rebalanced it at that low level so it didn't come to dominate the portfolio, over the last five years or so the volatility wouldn't have risen too much but the performance would have been improved. 

This is because in the five years since early 2016, BTC went from $300-500 range to $30000-50000 range. So of course, "hold what you would have held, but replace a bit of it with this thing that went up by ten to fifteen thousand percent" is going to get a better result, with hindsight. Their marketing departments love that sort of 'research'.

Where it becomes misleading is when people deliberately apply their own disingenuous wording to the research results. You said "discovered that risk adjusted returns are better". No, the discovery was that risk adjusted returns *were* better, past tense, short 5-10 year time period. Which is probably obvious to anyone who saw the tens of thousands of percent rise in BTC with only a few major crashes along the way.

If you put 3% of your portfolio into a cryptocoin and it loses half its value over the next five years, it will drag your returns down instead of boosting them, as you keep putting more of your traditional assets into the failing coin to top it up to your 3% allocation.  So, it's not the case that returns are better (current) or returns will be better (future), just that they once were better (past). You can't buy the past, you can only buy the now.

If BTC does halve or worse over the next five years as something better comes along,  the bank wouldn't then be able to have its marketing department write the same article about how risk adjusted returns improved over the last five years, because they didn't. They would instead have to use a decade of data to encompass the 10000% gain and subsequent 50% loss, and say they discovered that risk adjusted returns were better than a 60:40 portfolio through using that coin which had gone up by 5000% over the decade.

Of course, that early period when the going was good may not have actually been accessed by any of their clients, they're just looking at the theory of what you could have had as an early adopter.

We all know that holding uncorrelated assets which each deliver returns over time (at different times) can improve risk adjusted returns. That's why people have things like 60-40 portfolios in the first place. Having a small amount of crypto can diversify the outcome for better or worse, just like having some gold or other commodity that doesn't produce any income or inherently grow but might go up in value in future. So we can understand why people might have a minor allocation, just like they might have a minor allocation to 'play money' for gambling or stock punts.

But generally the crypto fans who gave been banging on about it being the future are not promoting it as part of an effort to educate the public on portfolio theory. They're just moderating their pitch to say, 'try 1%, it won't make you rich but it will help....' because they want to promote crypto while HODLing but realise that they won't be taken seriously by the mainstream if they suggest a bigger investment in something that could lose a massive percent over any given weekend. 

So they are saying just try a bit, it's cool, it's not too expensive and you can stop any time. Perhaps like someone trying to get his friends to take up smoking or cocaine or heroin so he can feel better about it himself and party with them while the going is good.

All that said, I do have a small crypto allocation

Zola.

The crypto space is very interesting, it is clearly not going away. Kevin O'Leary who spoke against digital assets for a long time now has 3% of his portfolio in Bitcoin. We are living in a world powered more increasingly by intelligent software, SAAS runs modern businesses, banks are increasingly turning to blockchain technology, etc. 
One thing is for sure, that crypto assets, in whatever form they end up maturing in, are here to stay. I like looking at alt coins, such as Stellar, who seem to be progressing well with the banks. At 30p a coin, would you miss a £50 punt on it for the chance for it to go parabolic? I don't....

HansOndabush

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

[Deleted User]

HansOndabush said:

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

Do you have any source of that information? You must be working in the government, or something? Or it's just wishful thinking, because it fits your beliefs that Bitcoin must fail?  

Bitcoin has been declared failed or dead how many times now? 402 times.

https://99bitcoins.com/bitcoin-obituaries/

For last 10 years Bitcoin has failed to die, providing investors with 200% CAGR (compound annual growth rate)

https://cointelegraph.com/news/bitcoin-s-compound-annual-growth-is-an-unheard-of-200-cagr

Oops.

HansOndabush

[Deleted User] said:

HansOndabush said:

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

Do you have any source of that information? You must be working in the government, or something? Or it's just wishful thinking, because it fits your beliefs that Bitcoin must fail?

There are sources in the sense of commentators opinions but its common sense really; why would any government and central banks give up their monopoly on controlling currency and hence the economy, be it digital or otherwise?

RichTips

HansOndabush said:

[Deleted User] said:

HansOndabush said:

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

Do you have any source of that information? You must be working in the government, or something? Or it's just wishful thinking, because it fits your beliefs that Bitcoin must fail?

There are sources in the sense of commentators opinions but its common sense really; why would any government and central banks give up their monopoly on controlling currency and hence the economy, be it digital or otherwise?

The global reserve currency is currently the US dollar, a currency controlled by only one of more than a handful of governments. Perhaps people might wake up one day and have an epiphany that Bitcoin is preferential to the currency of a country that elected Donald Trump.

HansOndabush

RichTips said:

HansOndabush said:

[Deleted User] said:

HansOndabush said:

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

Do you have any source of that information? You must be working in the government, or something? Or it's just wishful thinking, because it fits your beliefs that Bitcoin must fail?

There are sources in the sense of commentators opinions but its common sense really; why would any government and central banks give up their monopoly on controlling currency and hence the economy, be it digital or otherwise?

The global reserve currency is currently the US dollar, a currency controlled by only one of more than a handful of governments. Perhaps people might wake up one day and have an epiphany that Bitcoin is preferential to the currency of a country that elected Donald Trump.

I'm not saying 'people' might not want a better reserve currency or system than we have but the governments won't allow a change that relinquishes their control; don't you see that? The best one can hope for is a return to a currency actually backed by something like gold or else some digital crypto algorithm that prevents abuse like with have with M2 money supply today; but it will never be a bitcoin free for all, it will always be authority controlled unless we have civil war and complete breakdown in society in which case gold is your friend, not bits in the sky.

Thrugelmir

RichTips said:

HansOndabush said:

[Deleted User] said:

HansOndabush said:

The form they end up in will be the digital yuan and Fedcoin. Bitcoin will never be mainstream as the banks and governments can't control it and hence are likely to either ban it or impose much tougher restrictions on it's use such as KYC and tax reporting; that's if you can find any bank that will take the proceeds of non-government crypto.

Do you have any source of that information? You must be working in the government, or something? Or it's just wishful thinking, because it fits your beliefs that Bitcoin must fail?

There are sources in the sense of commentators opinions but its common sense really; why would any government and central banks give up their monopoly on controlling currency and hence the economy, be it digital or otherwise?

The global reserve currency is currently the US dollar, a currency controlled by only one of more than a handful of governments. Perhaps people might wake up one day and have an epiphany that Bitcoin is preferential to the currency of a country that elected Donald Trump.

To quote Gary Gensler, Biden's nominee to run the SEC. 

"The SEC must ensure that crypto markets are free of fraud and manipulation.  I think that’s the greater challenge, frankly, because some markets, usually operating overseas, have been rife with fraud."