Pretend I am an idiot if pretending is required. Explain it to me. My finance guy says he does not really understand it but we will meet next week. Buddy says I should be buying and I can't lose. Where does it get its value? How is it secured? Should I be buying when I got some loose coin? What is the risk?
Bitcoin
- Thread starter heel79
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Think of it as digital gold. Secured by the public blockchain (a public distributed ledger that requires consensus from majority of computers on the network) - not a central authority.
It gets its value by what people are willing to pay for it....some call it a Ponzi scheme because of this. There are a fixed number of coins that will ever be mined and put into circulation - some other coins have an unlimited supply.
Risk - like any other investment what you put into it could go down - possibly to zero.
It gets its value by what people are willing to pay for it....some call it a Ponzi scheme because of this. There are a fixed number of coins that will ever be mined and put into circulation - some other coins have an unlimited supply.
Risk - like any other investment what you put into it could go down - possibly to zero.
gtyellowjacket
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I think about it almost like a collectible. It has value because lots of people think it has value. This is in contrast to a commodity like steel which you can actually do something tangible with.
Someone above mentioned gold and that's probably a decent comparison. There's a limited supply of gold and folks have assigned a value to it despite it having pretty limited use cases to actually make something useful with it.
So what are the uses for Bitcoin? The legitimate uses are to store value outside of traditional currencies like a piece of art and to exchange currencies. Buy a Bitcoin with dollars and someone will pay you for that Bitcoin with pesos. You could do the same thing through the traditional banking system or someplace like Western Union but Bitcoin might eventually be a little cheaper or easier.
The illegitimate uses are to move money outside of a country with currency controls like China and to buy illicit substances like drugs. Those transactions can still be traced and tracked but no one really does that.
It's an investment but I don't know how to properly value it and I'm not sure anyone else does either. Is it underpriced today or overpriced or the right value? I'm not sure there's a good way to tell. Your friend that says you can't lose is absolutely wrong.
I think the best reason to invest in it today is to talk about it with other blockchain dorks about how much Bitcoin you own, what shit coins you're taking a flyer on, and what society will look like in x number of years after blockchain takes over. It's honestly not that much different than amateurs investing in individual stocks in the stock market. I wouldn't invest my nest egg in it but if you feel like investing a little bit that you could lose, it gives you something to talk about and something to learn about.
Someone above mentioned gold and that's probably a decent comparison. There's a limited supply of gold and folks have assigned a value to it despite it having pretty limited use cases to actually make something useful with it.
So what are the uses for Bitcoin? The legitimate uses are to store value outside of traditional currencies like a piece of art and to exchange currencies. Buy a Bitcoin with dollars and someone will pay you for that Bitcoin with pesos. You could do the same thing through the traditional banking system or someplace like Western Union but Bitcoin might eventually be a little cheaper or easier.
The illegitimate uses are to move money outside of a country with currency controls like China and to buy illicit substances like drugs. Those transactions can still be traced and tracked but no one really does that.
It's an investment but I don't know how to properly value it and I'm not sure anyone else does either. Is it underpriced today or overpriced or the right value? I'm not sure there's a good way to tell. Your friend that says you can't lose is absolutely wrong.
I think the best reason to invest in it today is to talk about it with other blockchain dorks about how much Bitcoin you own, what shit coins you're taking a flyer on, and what society will look like in x number of years after blockchain takes over. It's honestly not that much different than amateurs investing in individual stocks in the stock market. I wouldn't invest my nest egg in it but if you feel like investing a little bit that you could lose, it gives you something to talk about and something to learn about.
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I agree with this. If curiosity gets the best of me and I want to dip my toe in the crypto world, I will probably just buy one of the ETFs like ARKB to get some exposure so I don’t have to screw around with owning a digital wallet to possess the actual coins and deal with other shit I don’t really understand. But I’m not even to the point of buying an ETF yet. It still smells like a scam to me, and Trump jumping in to the deep end of crypto with his own coin only reinforces that feeling to me.
bassydude77
Well-Known Member
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Four years ago, MAGA claimed it was another spoke in the wheel of the New World Order. Now it's the best thing going....
thebruinbleedstarheelblue
Exceptional Member
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they are such sheep. You now see how cults thrive in US
JCTarheel82
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Bitcoin and Ethereum are lower risk but there have been a huge number of scam coins in the market over the past few years. Just recently, the Hawk Tuah girl released a meme coin that, unsurprisingly, turned out to be a pump and dump. The opportunity for grift is near limitless in the crypto space so of course Trump had to enter the market.
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There is corruption/blood $ everywhere and in every currency/business/stock etc. Its just the world we live in.
The whole digital currency thing just seems like a con to me so i steer clear for that reason alone. Nothing other tha a gut feel.
The whole digital currency thing just seems like a con to me so i steer clear for that reason alone. Nothing other tha a gut feel.
I’m sure people much smarter than me have expounded on this at length but to me it’s interesting because it’s probably the closest we’ll get to a pure expression of free market.
I read a novel with cryptocurrency as one of the main plot points as a teenager- Cryptonomicon by Neal Stephenson (highly recommended!). So I paid attention to the early days of Bitcoin and remember sitting in my Morrison dorm room in 2010 trying to figure out how to buy some, as it wasn’t nearly so easy as it is now. I didn’t have the attention span to follow through and so now I’m stuck working for 30 more years. But even if I had succeeded they probably would have been sold in short order for beer, so I’m not too broken up about it.
I finally put $15 in two weeks ago, which is now worth… $16.50.
I read a novel with cryptocurrency as one of the main plot points as a teenager- Cryptonomicon by Neal Stephenson (highly recommended!). So I paid attention to the early days of Bitcoin and remember sitting in my Morrison dorm room in 2010 trying to figure out how to buy some, as it wasn’t nearly so easy as it is now. I didn’t have the attention span to follow through and so now I’m stuck working for 30 more years. But even if I had succeeded they probably would have been sold in short order for beer, so I’m not too broken up about it.
I finally put $15 in two weeks ago, which is now worth… $16.50.
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I’m not sure it’s a “gut” thing. It appears blatantly bullshit. Sure, the dollar is more or less fiat, though with a historical tangible value and the security and stability (relative) of the US economy and monetary management. Bitcoin et al. has value, more or less, because.
AlbionAmerican
Active Member
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FYI, the Tulip Bubble lasted 3 years, people have been saying your exact point for 15 years now and its getting pretty old. Show me another investment vehicle that has weathered as much as Bitcoin and come out the other side as a $2 trillion asset class, then make your bubble argument.
AlbionAmerican
Active Member
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Its nothing like a collectible, you have no idea what you're talking about.
It's being purchased by Fortune 500s, globally important banks, nation states. I suppose they also from time to time might buy collectibles, but its not for the same reasons they're purchasing Bitcoin.
The use case for Bitcoin is actually incredibly pro-American. We have an asset that is overwhelmingly owned by Americans and American institutions that anyone in the world can use to store their savings and avoid local inflation, or to acquire USD to transact abroad. You have no idea how revolutionary this is for people currently suffering inflationary regimes around the world.
Early on it also showed signs that it was manipulated. I'm not sure that is the case any longer so long as you are only looking at Bitcoin and a few others.
p5mmr9
Well-Known Member
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There are plenty of people who have earned a fortune trading crypto, but it is largely a vehicle to lose money. If you really want to invest in crypto - wait for the next big drop and then buy and hold. It's being juiced right now by MAGA and it will drop once reality sets in regarding the (lack of) possibility of a USD digital currency.
StrangePackage
Distinguished Member
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There are always greater fools, until there aren't.
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i.e., it's a grift