Cryptocurrencies inc. Bitcoin

Nardge

Dear Forumites,

I'm already invested in various things which I largely understand e.g. Innovative Finance (Peer-to-Peer lending) and Stocks and Shares by way of a global index tracker, and have been keen to diversify into other things for many years.  

Currently, I wish to educate myself regarding Bitcoin and other Cryptocurrencies. 

Would anyone very knowledgeable and experienced with these already be able to recommend any authoritative online resources or discussions that detail and explain things to a high standard?

Maybe there exists a thread or two in the MSE forum where people have written useful summaries too?

My aim would be to invest in it now, hold it for the long term, and hopefully see it grow.

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?

Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Does getting involved with Bitcoin consume much of one's personal time c/f offloading and forgetting investments in a stocks and shares global index tracker and being done with it?

Thanking you in advance for your response,

Clement

PRAISETHESUN

There's a few crypto threads on the "savings and investments" board if you do a quick search of the forum.

As an actual investment vehicle, it is incredibly high risk (and in my mind is more akin to gambling) as you basically need to time the market to profit from it. Definitely would strongly recommend against it unless you can afford to lose 100% of the money you put in.

caprikid1

Crypto seems to be only "Investment" that existing investors push hard, traditional investments always seem to have a caveat of Do your own reasearch.

I read so much magical story around every new Crypto currency launched , how it is different to all the rest and will be successful then it tanks.....

Bitcoin relies on either more investors or use cases for growth in value. 

Ergates

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?

Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

The reason it's not clear why this happens is because it's based on nothing.  Crypto currencies are, basically, ponzi schemes - in that they don't generate wealth, they just transfer it from one person to another.  Any profit comes from people who lose money.

New currencies generate interest because they're new, then people "invest" in them, so the value goes up because people want to buy them.   Then people see the value going up, so more people buy them, so the value goes up more, and people see the value going up and buy them, so the value goes up, etc etc.   However, eventually people realise that the emperor is actually naked, and the value plumets.

People who invested early - bought low and sold high make a profit.  People who were late to the game or unlucky with their timing lose everything.  People who made money off them convince themselves it's because they're skilled investors, when in reality they were just lucky - they gambled and won.

The important thing to remember is:  The emperor *really is* naked.  Crypto currencies have absolutely no real value.  They do nothing of value.  The only reason people buy them is because they think they're going to go up in value.

The posited use cases for them are, in reality, barely ever used, they're the myth used to support the idea.


THEN we come to the even darker side:  energy consumption.   Crypto currencies use a ludicrous amount of energy to generate.

Bitcoin mining alone (the largest of the approx. 19,000 crypto currencies) uses about 175 TerraWatt Hours a year.  For reference, the UK used 266 TWh in 2023.

In the world of 2024, in which we're plummeting towards environmental catastrophe - largely from CO2 emissions, using all this power for, effectively, *nothing* is not just unethical, it's downright immoral.


So, in conclusions:  They're unstable, based on nothing, and unethical.

caprikid1

Ergates said:

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?

Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

The reason it's not clear why this happens is because it's based on nothing.  Crypto currencies are, basically, ponzi schemes - in that they don't generate wealth, they just transfer it from one person to another.  Any profit comes from people who lose money.

New currencies generate interest because they're new, then people "invest" in them, so the value goes up because people want to buy them.   Then people see the value going up, so more people buy them, so the value goes up more, and people see the value going up and buy them, so the value goes up, etc etc.   However, eventually people realise that the emperor is actually naked, and the value plumets.

People who invested early - bought low and sold high make a profit.  People who were late to the game or unlucky with their timing lose everything.  People who made money off them convince themselves it's because they're skilled investors, when in reality they were just lucky - they gambled and won.

The important thing to remember is:  The emperor *really is* naked.  Crypto currencies have absolutely no real value.  They do nothing of value.  The only reason people buy them is because they think they're going to go up in value.

The posited use cases for them are, in reality, barely ever used, they're the myth used to support the idea.


THEN we come to the even darker side:  energy consumption.   Crypto currencies use a ludicrous amount of energy to generate.

Bitcoin mining alone (the largest of the approx. 19,000 crypto currencies) uses about 175 TerraWatt Hours a year.  For reference, the UK used 266 TWh in 2023.

In the world of 2024, in which we're plummeting towards environmental catastrophe - largely from CO2 emissions, using all this power for, effectively, *nothing* is not just unethical, it's downright immoral.


So, in conclusions:  They're unstable, based on nothing, and unethical.

The Crypto Bro's won't thank you or acknowledge the above

QrizB

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?
Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Here's a recent illustration from WIRED that shows how crypto works (or doesn't):

https://www.wired.com/story/memecoin-kid-backlash/

Nardge

QrizB said:

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?
Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Here's a recent illustration from WIRED that shows how crypto works (or doesn't):

https://www.wired.com/story/memecoin-kid-backlash/

Unfortunately this is link is behind a paywall... Can it be found elsewhere?  

Ergates

Nardge said:

QrizB said:

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?
Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Here's a recent illustration from WIRED that shows how crypto works (or doesn't):

https://www.wired.com/story/memecoin-kid-backlash/

Unfortunately this is link is behind a paywall... Can it be found elsewhere?  

It's not, I'm able to read it and I certainly haven't paid anything.

QrizB

Nardge said:

QrizB said:

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?
Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Here's a recent illustration from WIRED that shows how crypto works (or doesn't):

https://www.wired.com/story/memecoin-kid-backlash/

Unfortunately this is link is behind a paywall... Can it be found elsewhere?  

Here is Yahoo!'s take on the story (shorter and less informative that the WIRED article):
https://uk.news.yahoo.com/teen-brutally-rug-pulls-crypto-123046117.html

born_again

Nardge said:

QrizB said:

Nardge said:

It's not clear how this happens however, as there's no apparent interest, reinvestment of profit, dividend, or other similar, so I don't understand how 'growth' can be evidenced, reflected or banked in a visible or tangible form?
Is an analogy a yoyo where the game is simply to invest and divest at the correct down and up times?

Here's a recent illustration from WIRED that shows how crypto works (or doesn't):

https://www.wired.com/story/memecoin-kid-backlash/

Unfortunately this is link is behind a paywall... Can it be found elsewhere?  

Not hree either

On the evening of November 19, art adviser Adam Biesk was finishing work at his California home when he overheard a conversation between his wife and son, who had just come downstairs. The son, a kid in his early teens, was saying he had made a ton of money on a cryptocurrency that he himself had created.

Initially, Biesk ignored it. He knew that his son played around with crypto, but to have turned a small fortune before bedtime was too far-fetched. “We didn’t really believe it,” says Biesk. But when the phone started to ring off the hook and his wife was flooded with angry messages on Instagram, Biesk realized that his son was telling the truth—if not quite the full story.

AI Lab Newsletter by Will Knight

M25

Fools and their money are easily parted.

'Crypto' is as mentioned a Ponzi scheme and/or a scam.

Undoubtedly smart people make money out of it but idiots pay for that. 

There's definitley more idiots every day happily joining the Ponzi scheme.

As long as the rest of us with a bit of common sense don't have to pick up the bill then let people gamble away their lives. 

I know someone who bragged about making money from crypto and he made sure everyone knew about it and we later found out he had a serious cocaine habit. 

Not sure which came first but it was a perfect match.