Is bitcoin just a giant game of “chicken”?

steampowered

me1000uk said:

essentially you're looking at a speculative asset based on luck over the past few years, rather than something that has been relatively robust for generations. 

The "generations" argument is a weak argument. The world is changing. You only need to look at what the 10 most valuable companies in the world are, and compare that to what they were 20 years ago. Investing based on your grandparents invested in is an awful approach to investing. 

British Gas (Centrica) was supposedly a "reliable" investment that people had taken as a secure stock - yet has lost more than 90% of its value over the past few years!

Gold is a completely speculative investment - the value is based entirely on what people speculate will happen to the price in future, and not on its underlying economic purpose. The investment case for gold is non-existent on any reasonable valuation metric. As Warren Buffet put it:

“You could take all the gold that’s ever been mined, and it would fill a cube 67 feet in each direction. For what it’s worth at current gold prices, you could buy — not some — all of the farmland in the United States. Plus, you could buy 10 Exxon Mobils (XOM), plus have $1 trillion of walking-around money. Or you could have a big cube of metal. Which would you take? Which is going to produce more value?”

The price of most other commodities (coal, copper, steel, salt, grain) has crashed; there is no reason to be confident that gold won't do the same.

I can absolutely see cryptocurrency replacing gold as the preferred option for hedging against inflation, which would dramatically undermine gold's value.

me1000uk

steampowered said:

me1000uk said:

essentially you're looking at a speculative asset based on luck over the past few years, rather than something that has been relatively robust for generations. 

The "generations" argument is a weak argument. The world is changing. You only need to look at what the 10 most valuable companies in the world are, and compare that to what they were 20 years ago. Investing based on your grandparents invested in is an awful approach to investing. 

British Gas (Centrica) was supposedly a "reliable" investment that people had taken as a secure stock - yet has lost more than 90% of its value over the past few years!

Gold is a completely speculative investment - the value is based entirely on what people speculate will happen to the price in future, and not on its underlying economic purpose. The investment case for gold is non-existent on any reasonable valuation metric. As Warren Buffet put it:

“You could take all the gold that’s ever been mined, and it would fill a cube 67 feet in each direction. For what it’s worth at current gold prices, you could buy — not some — all of the farmland in the United States. Plus, you could buy 10 Exxon Mobils (XOM), plus have $1 trillion of walking-around money. Or you could have a big cube of metal. Which would you take? Which is going to produce more value?”

The price of most other commodities (coal, copper, steel, salt, grain) has crashed; there is no reason to be confident that gold won't do the same.

I can absolutely see cryptocurrency replacing gold as the preferred option for hedging against inflation, which would dramatically undermine gold's value.

Thanks for responding although I don't think your guess as to what will happen to gold has any relation to crypto. Crypto is meaningless to most of the world and could be rendered meaningless pretty quickly if legislation occurs. Gold most definitely means something to most of the world. You're purely guessing. 

This is just an example of the crypto waffle trying to associate crypto as a gold replacement. Maybe better to stick to crypto merits and see if they stand on their own feet. I agree it may result in something but at the moment it is just a get rich hope with late adopters feeding the early ones accompanied by the most toxic charlatan filled hype machine ever seen on any internet media. 

 How can you possibly not see this???

sebtomato

Between technical issues, government/central banks upcoming bans, blatant manipulations, Bitcoin is a very risky investment now.
There were some alleged technical issues a few months ago, when apparently one transaction went to the ledger twice. If that was to happen, then Bitcoin's integrity is gone. Also, there could be other issues.
Many governments and central banks are slowly going to make it illegal/banned, since they can't control it and a lot of it is used for illegal activities.
Of course, there are also blatant market manipulations from Musk and others.
Bitcoin has got no real value and could collapse and drop to zero in a matter of hours. after having ruined a few people and the planet (given the pollution generated)

Zola.

How long does it have to keep going up before people may come to realise it has high demand and ultimately value? Short-term volatility is the price you pay for 200% gains per year on average. It is the single most asymmetric opportunity available in the world today, and to not have some money in it is crazy, in my opinion...
Noone who has held bitcoin for 4 years / through a full cycle has ever lost money. 
People have been saying it's a scam/ponzi scheme or refer to "tulips" since 2009. Yet bitcoin doesnt care and it just keeps on creating new blocks 24/7, 365 days a year. It never sleeps.

HansOndabush

Every bubble pops at some point.

Zola.

How many investing bubbles have lasted for over 12 years?

lozzy1965

HansOndabush said:

Every bubble pops at some point.

When one is talking stock markets and housing bubbles - which so far crypto are akin to - then they do not 'pop' down to nothing.  They 'pop' back a bit, then carry on growing to new highs.

HansOndabush

Zola. said:

How many investing bubbles have lasted for over 12 years?

South Sea bubble

Japan real estate bubble

Japan stock market bubble

The Wall St. crash of 1929

US housing bubble

S&P 500 bubble (we are currently in)

Crypto bubble

The most obvious part of the bubble is the last parabolic surge upwards but many of these bubbles took years to form before that final surge. Same with bitcoin; it exactly follows the typical bubble chart; we are currently in the bull trap phase before the next leg down to sub $20K. Good luck with your investment, HFSP

lozzy1965

HansOndabush said:

Zola. said:

How many investing bubbles have lasted for over 12 years?

South Sea bubble

Japan real estate bubble

Japan stock market bubble

The Wall St. crash of 1929

US housing bubble

S&P 500 bubble (we are currently in)

Crypto bubble

The most obvious part of the bubble is the last parabolic surge upwards but many of these bubbles took years to form before that final surge. Same with bitcoin; it exactly follows the typical bubble chart; we are currently in the bull trap phase before the next leg down to sub $20K. Good luck with your investment, HFSP

And the timeframe for your chart's sub 20K?

Zola.

HansOndabush said:

Zola. said:

How many investing bubbles have lasted for over 12 years?

South Sea bubble

Japan real estate bubble

Japan stock market bubble

The Wall St. crash of 1929

US housing bubble

S&P 500 bubble (we are currently in)

Crypto bubble

The most obvious part of the bubble is the last parabolic surge upwards but many of these bubbles took years to form before that final surge. Same with bitcoin; it exactly follows the typical bubble chart; we are currently in the bull trap phase before the next leg down to sub $20K. Good luck with your investment, HFSP

I will respectively disagree. "Have fun staying poor", how classy of you. 
Bitcoin will never make me poor, as I will never over-extend myself in it.  Will it make me rich? Maybe...