Is bitcoin just a giant game of “chicken”?

Infrastructure

We are now at the stage here the vast majority of commentators have concluded that bitcoin will never be a major currency, due to its economic and technical drawbacks.

 

There is still a debate raging as to whether bitcoin will become the “new gold” and last as a transferable monetary token for hundreds of years, or whether it is a fad and its value will, at some point, rapidly return to zero (or close to it).

 

Few people, apart from the occasional bitcoin zealots, see the value of bitcoin lasting for hundreds of years, therefore it must at some point revert to zero.

 

This then makes bitcoin nothing more than a giant game of “chicken” (or “Buckaroo!” for those that did not get out as much as children).

 

The winners of the game will be those that will sell their bitcoin when the price is high, prior to the big, final drop. The losers will be those that hold bitcoin during the big, final drop.

 

Who, in their right mind, plays a game like this with their money, and thinks it is investing and not gambling?

 

n.b. Maybe surprisingly, I am not a bitcoin hater, but will not be purchasing any due to its unethical nature.

MX5huggy

If you invest in any single stock the most likely outcome is being wiped out. 

HansOndabush

Bitcoin is a token that people buy in the hope of selling to someone else at a higher price. Not much more than that to it really. I cant see it has any use or inherent value that you can measure to see if it is expensive or cheap.
To previous poster, where do you get that idea from, that if you buy a share you will be wiped out? Doesn't seem correct. I've had the odd share go bust but many more have been taken over at a premium. The remainder move with the fortunes of the company and markets and I can generally sell anytime I choose.

Infrastructure

MX5huggy said:

If you invest in any single stock the most likely outcome is being wiped out. 

Are you sure? I believe most listed shares continue indefinitely, or get merged / bought out. Sure, some fail, but that isn't the most likley outcome.

thegentleway

Infrastructure said:

MX5huggy said:

If you invest in any single stock the most likely outcome is being wiped out. 

Are you sure? I believe most listed shares continue indefinitely, or get merged / bought out. Sure, some fail, but that isn't the most likley outcome.

Most don't beat T-bills: https://www.universal-investment.com/media/document/Do Stocks outperform Treasury Bills

MX5huggy

Infrastructure said:

MX5huggy said:

If you invest in any single stock the most likely outcome is being wiped out. 

Are you sure? I believe most listed shares continue indefinitely, or get merged / bought out. Sure, some fail, but that isn't the most likley outcome.

Ok maybe most frequent not most likely outcome https://youtu.be/xQvTJG7DSR8

https://www-ft-com.cdn.ampproject.org/ii/w820/s/www.ft.com/__origami/service/image/v2/images/raw/https%3A%2F%2Fd6c748xw2pzm8.cloudfront.net%2Fprod%2F33756280-ae5b-11eb-94ee-81af6bf9534c-standard.png?source=google-amp&fit=scale-down&width=500

from 

https://www.ft.com/content/55738213-de06-4575-8492-b5b366eb88dc

Grenage

Infrastructure said:

Who, in their right mind, plays a game like this with their money, and thinks it is investing and not gambling?

People who are looking for a get-rich-quick scheme, or people with a very small percentage allocated as a speculative flutter.

HansOndabush

Infrastructure said:

Who, in their right mind, plays a game like this with their money, and thinks it is investing and not gambling?

People who Have Fun Staying Poor apparently.

tichtich

Bitcoin is a zero-sum game. Chicken isn't. 

Malthusian

Infrastructure said:

MX5huggy said:

If you invest in any single stock the most likely outcome is being wiped out. 

Are you sure? I believe most listed shares continue indefinitely, or get merged / bought out. Sure, some fail, but that isn't the most likley outcome.

True, but MX5huggy didn't specify listed stocks.

Most businesses fail within the first few years, so if you bought a random company's shares, the most likely outcome would be being wiped out.

(How many isn't clear. The first result on Google for my search for some figures said "Around 80 per cent of UK companies fail within their first year and, according to the latest figures from the Office for National Statistics, only 42.4 per cent of businesses started in 2013 were still trading five years later." So 80% of companies fail within their first year and 58% fail within the first five. Riiiiiiight... However, although statistics on the opening and closing of new businesses are very dodgy, I think it's generally accepted that the majority of new ventures fail.)

If you invest in any single FTSE 100 or S&P 500 stock I doubt more of them go bust than not over, say, an average human lifetime. Over a long enough timeframe, 100% of investments go bust.

root

HansOndabush said:

Infrastructure said:

Who, in their right mind, plays a game like this with their money, and thinks it is investing and not gambling?

People who Have Fun Staying Poor apparently.

???
Nothing wrong with it as a suitably sized part of high risk allocation in a portfolio.