Cryptocurrencies: Your thoughts?

nfmg

EDIT: The spirit of my question is basically: "Are they useful?" and "If so, which ones?" [and guessing best to try Bitcoin unless otherwise advised].

OP: With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

aerostar

nfmg said:

With how they are known to fluctuate are they ever a safe bet?

In a word   NO

The only safe bets are...death and taxes.

wongataa

They are a terrible thing.  They take a huge amount of energy to create and process transactions which is bad in climate change terms.  Then there are the scams and criminal use aspects.

TimSynths

nfmg said:

With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

I've got a fair bit, been buying for 13 months. I don't tend to buy and sell for a quick buck as I don't have the time but I friends that do it full time now. I tend to buy and keep it, have most of it staked and earning 5% and I think there is a good chance in a few years time it could become a life changing amount, I have invested approx £7k so far across 7 different projects and only one is in the red currently but i'm confident it will come good.

eskbanker

nfmg said:

With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

There's a long-running Bitcoin thread that's currently at 186 pages, but you only need to read a few, as most comments are repeated and paraphrased on an infinite loop....

https://forums.moneysavingexpert.com/discussion/6218458/bitcoin/p1

nfmg

aerostar said:

nfmg said:

With how they are known to fluctuate are they ever a safe bet?

In a word   NO

The only safe bets are...death and taxes.

Yes after I posted that I sort of facepalmed for stating the obvious. It was late and i wanted to get as much done as possible in terms of finding out or asking about anything I could as it all helps n the end. I suppose what I really was trying to find out was are there ever any bargains to be found with it? It would seem the answer is in short: Yes but be very careful. Guessing a lot of people have lost out big time on cryptocurrencies. But thank you for answering and advising caution!

wongataa said:

They are a terrible thing.  They take a huge amount of energy to create and process transactions which is bad in climate change terms.  Then there are the scams and criminal use aspects.

I hadn't considered this. It would seem there is the possibility of crypto in such events being a sort of front that allows for I will just say certain things. I don't want to say what in case it 'inspires' anyone. All good info to have to arm oneself against being defrauded. Thank you for potentially helping me avoid this.

TimSynths said:

nfmg said:

...

I've got a fair bit, been buying for 13 months....

Another perspective to consider. Thank you for the alternative view. I like to weigh it all up and mull it over. Be careful though. Also you seem to be into stocks and al that so any general info you have on just how to buy stocks - as in how to do it in an above board way that is safe in so far as shall we say regulated accordingly [i.e. meaningfully] for protection of shareholders I would very much appreciate. Thank you for the other view on crypto.

[Plus any info on any useful sites regarding crypto info would also be appreciated. Thanks!] 

eskbanker said:

nfmg said:

...

There's a long-running Bitcoin thread that's currently at 186 pages, but you only need to read a few, as most comments are repeated and paraphrased on an infinite loop....

Thank you for the thread link. This is the kind of thing I am looking for to give me some additional sense of it.

Zola.

Read the bitcoin thread OP, but most importantly read a few books on the subject like layered money or the bitcoin standard.

Aegis

eskbanker said:

nfmg said:

With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

There's a long-running Bitcoin thread that's currently at 186 pages, but you only need to read a few, as most comments are repeated and paraphrased on an infinite loop....

https://forums.moneysavingexpert.com/discussion/6218458/bitcoin/p1

Just to summarise my position, I think the technology is interesting, but for me it doesn't qualify as an investment becase there is no means of generating future growth except for people to continue adding money in to the system.  To me that's an example of Greater Fool Theory in action, which makes this look broadly similar to a Ponzi Scheme.  It's worth looking up all of those things if they're unfamiliar, as it will make for some very interesting reading.  Also worth looking up Tulip Mania and Beanie Babies for examples of where people traded assets for far more than they were worth in order to try and get rich quick.

Always worth asking the question "how do I value this asset?"  My usual criterion is that either it must either be generating an income now or have the potential to do so in future.  That means having either a manufacturing process, intellectual property or some form of service.  There are some assets out there which pretend to have these features, so you need to be careful (this is why huge interest rates offered on savings "bonds" were used - they seemed attractive, but they were in reality highly risky assets.

User232002

Aegis said:

Just to summarise my position, I think the technology is interesting, but for me it doesn't qualify as an investment becase there is no means of generating future growth except for people to continue adding money in to the system.  To me that's an example of Greater Fool Theory in action, which makes this look broadly similar to a Ponzi Scheme.  

Plenty of them seem to be doing just fine offering a service and charging people for it:



Note this is protocol revenue for the last 30 days only. Yes, there is a crypto asset out there that generated over a billion dollars in the last 30 days in revenue.

Aegis said:

Also worth looking up Tulip Mania and Beanie Babies for examples of where people traded assets for far more than they were worth in order to try and get rich quick.

As already mentioned, tulips were a leverage bubble driven by newly introduced options that actually cost people very little as most of these options were either voidable or voided by the government of the day. The usage of tulips as a bubble or ponzi scheme is a misappropriation of history.

Beanie baby production numbers were unlimited and as soon as supply caught up to demand the price fell. Quality digital assets do not suffer from this problem.

Both of these allegories are poor.

Aegis said:

Always worth asking the question "how do I value this asset?"  My usual criterion is that either it must either be generating an income now or have the potential to do so in future.  That means having either a manufacturing process, intellectual property or some form of service.  There are some assets out there which pretend to have these features, so you need to be careful (this is why huge interest rates offered on savings "bonds" were used - they seemed attractive, but they were in reality highly risky assets.

Using the DCF model on ETH with its protocol revenues and modest growth/valuation figures gives it a valuation of $4T. Its current market valuation is only $370B.

https://twitter.com/korpi87/status/1489745430497972224

Thrugelmir

nfmg said:

With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

Would you ever consider buying foreign currency and trading it to make a return? 

User232002

Thrugelmir said:

nfmg said:

With how they are known to fluctuate are they ever a safe bet? I haven't used them but one can surmise certain things with even the slightest modicum of information. That is what we are all here for, yes? 

Would you ever consider buying foreign currency and trading it to make a return? 

The name 'cyptocurrencies' needs retiring. Plenty of these assets, and all the investable ones, have no intention of being currencies.