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  • Originally posted by NapoleanDynamite View Post



    At bare minimum it will become the best store of value (I don't know the time frame). It will crush bonds, Real Estate, Collectibles, Gold and Cash for its use as a store of value. On the "max" end of the spectrum it would become the best borderless global medium of exchange. Either way, it has a long ways to go IMO.
    This might be the biggest piece of nonsense I've ever seen written about BTC. BTC will absolutely, positively never surpass real estate as a store of value. RE is the original "finite" asset class. We have an ever growing population, and god hasn't made any new dirt in some time. Also, last time I checked, you cannot live in a BTC, work in a BTC, sell goods or services in a BTC, manufacture anything in a BTC. Likewise, you cannot farm on a BTC, you cannot grow Timber on a BTC, you cannot mine resources from a BTC.

    I am not an anti crypto guy. I have a small allocation actually. However, I think there is far more value in blockchain and it's use in other applications than anything. I also see the value for some emerging markets where their official currency is utter crap (Turkey, Zimbabwe, Venezuela etc.). I'm not sure how much that really translates to long term to the value of BTC and other crypto though.

    The thing I find most interesting about crypto discussion though, is that the most of the talking points from the "to the moon" crowd get more and more sensationalized every day (see above comments). The thesis for BTC in particular has morphed about a half dozen times in the last 5 years as well. It started as an alternative currency that wasn't subject to a central banking system's manipulation (although with such a large portion controlled by a handful of anonymous owners, I'm not sure that's a better alternative but I digress). Then when some guy realized he spent six figures on two large pizzas, the narrative changed to BTC being a store of value and a hedge against inflation and the stock market. Neither of those things appear to be true based on price performance in BTCs history.

    Again I am not anti-crypto, but like most things, the reality is likely somewhere between the "HODL" crowd and the "worthless" crowd. At this point I don't think any crypto can be considered anything more than a speculative play. That's not a knock, just a reality. Speculative plays can certainly have a spot in a portfolio, but should be treated as such. I think the scary thing right now is how many people are taking a disproportionate stake in these speculative investments based on trying to replicate what essentially amounts to a bunch of lottery winners who happen to fall into BTC very early on.

    Comment


    • Originally posted by CREGuy View Post

      This might be the biggest piece of nonsense I've ever seen written about BTC. BTC will absolutely, positively never surpass real estate as a store of value. RE is the original "finite" asset class. We have an ever growing population, and god hasn't made any new dirt in some time. Also, last time I checked, you cannot live in a BTC, work in a BTC, sell goods or services in a BTC, manufacture anything in a BTC. Likewise, you cannot farm on a BTC, you cannot grow Timber on a BTC, you cannot mine resources from a BTC.

      I am not an anti crypto guy. I have a small allocation actually. However, I think there is far more value in blockchain and it's use in other applications than anything. I also see the value for some emerging markets where their official currency is utter crap (Turkey, Zimbabwe, Venezuela etc.). I'm not sure how much that really translates to long term to the value of BTC and other crypto though.

      The thing I find most interesting about crypto discussion though, is that the most of the talking points from the "to the moon" crowd get more and more sensationalized every day (see above comments). The thesis for BTC in particular has morphed about a half dozen times in the last 5 years as well. It started as an alternative currency that wasn't subject to a central banking system's manipulation (although with such a large portion controlled by a handful of anonymous owners, I'm not sure that's a better alternative but I digress). Then when some guy realized he spent six figures on two large pizzas, the narrative changed to BTC being a store of value and a hedge against inflation and the stock market. Neither of those things appear to be true based on price performance in BTCs history.

      Again I am not anti-crypto, but like most things, the reality is likely somewhere between the "HODL" crowd and the "worthless" crowd. At this point I don't think any crypto can be considered anything more than a speculative play. That's not a knock, just a reality. Speculative plays can certainly have a spot in a portfolio, but should be treated as such. I think the scary thing right now is how many people are taking a disproportionate stake in these speculative investments based on trying to replicate what essentially amounts to a bunch of lottery winners who happen to fall into BTC very early on.
      Thanks for your thoughts. I have italicized area's that we agree. I have bolded statements that are factually incorrect. There are other statements you have made that we disagree upon...But I would ask you a question before responding further...Can you discuss in detail your knowledge of the history of money? Thank you.

      Comment


      • Originally posted by xraygoggles View Post

        I'm not sure I agree - not only because 99% of NFTs are utter crap, but also b/c they are highly illiquid, especially during a crisis. Very hard to get a bid and liquidate.
        Very true in most cases, which is why I primarily stick to utility NFT's these days. The utility isn't affected by the market nearly as much as something like profile pics, in that the only real value is in what the market will pay for it. I should have clarified, but I haven't bought a PFP or anything outside of utility NFT's in quite a while.

        I think we're seeing a move away from that 99.99% and people are starting to realize that without utility, the value is limited. Probably should have been apparent from the get-go, but it's crypto. This is also why I'm a fan of blockchain gaming right now. That market is pretty insular and, while affected by outside market forces, isn't impacted as much as you'd expect. Gala NFT's are also pegged to the dollar in their store; so there's always a floor price that's relatively stable.

        In terms of liquidity, I've sold about 30k worth of utility NFT's (primarily game items) with no problems in the last week; with the intention of sending that money into some of my favorite tokens that are cheap atm. I have roughly 150k more worth up for sale right now that I know without a doubt I could firesale for 120'sh. Again, these are more than just simple pictures. They give value in the games; so people are willing to pay for that utility.
        I should have been a pair of ragged claws. Scuttling across the floors of silent seas.

        Comment


        • Originally posted by Kamban View Post

          I think 99.999% are utter crap. Even for ones that are not, what really is its value in 5-10 years. How many people want to buy monkey faces or children's doodles for $500K. As to that music video that sold for 400K, I bet in 5 years no one will even remember the artist who made the video, let alone the video.. And for the rare folk that want to watch that video, they can see it for free YouTube and not have to shell out half a million for more to just say that I own this obscure singer's music video.

          As to comparing NFT to the Mona Lisa at the Louvre, the difference is that any other copy, reproduction, digital image of Mona Lisa will not be 100% the same as the physical painting. But a NFT is a signed digital copy of a digital image or digital audio and hence it will be identical to any other digital copy, except it is not recorded on the blockchain network. For 500K savings, I can live with that.
          I mean, you're not wrong. I do think there can be an argument made for benefits that NFT's can bring to certain markets. We're just starting to see that, so I see things like that video you mentioned as an important step towards a better use case.

          The copyright/digital copy case (and value) has been brought up and argued to death. Some people just like owning the original and are willing to pay for it. I do think that market is extremely small, though. Not enough to sustain the current frenzy, for sure.

          I don't know how long this craze is going to last. I do see some long-term usefulness (like gaming, as I've mentioned), but I plan to make hay while the sun shines. Five years from now we may all be laughing about the insanity but hopefully, we'll be laughing about how much money was made from it, rather than how much money was lost.
          I should have been a pair of ragged claws. Scuttling across the floors of silent seas.

          Comment


          • Originally posted by Doc Spouse View Post
            The copyright/digital copy case (and value) has been brought up and argued to death. Some people just like owning the original and are willing to pay for it. I do think that market is extremely small, though. Not enough to sustain the current frenzy, for sure.
            It all comes to cost. Blu-Ray disk will cost $30 or so at most and come close to original. How much are we willing to pay to get that 8K video? Certainly not 250K

            I don't know how long this craze is going to last. I do see some long-term usefulness (like gaming, as I've mentioned), but I plan to make hay while the sun shines. Five years from now we may all be laughing about the insanity but hopefully, we'll be laughing about how much money was made from it, rather than how much money was lost.
            You have to be careful that you are not left standing in this musical chairs game when the music stops. No one knows when the craze will end and if you can cash out in time.
            Last edited by Kamban; 01-26-2022, 06:48 AM.

            Comment


            • Originally posted by NapoleanDynamite View Post

              Thanks for your thoughts. I have italicized area's that we agree. I have bolded statements that are factually incorrect. There are other statements you have made that we disagree upon...But I would ask you a question before responding further...Can you discuss in detail your knowledge of the history of money? Thank you.
              Ah, the truth comes out, all crypto heads are Austrian economists at heart.

              Comment


              • Originally posted by FIREshrink View Post

                Ah, the truth comes out, all crypto heads are Austrian economists at heart.
                Ha...Actually I hate the term "crypto"...so I definitely wouldn't classify me as a "crypto head". If you have kept up with any of this thread, I have not recommended any other cryptocurrencies outside of BTC.

                As for Austrian Economics, yes I am aware of Austrian Economics. Interestingly, prior to starting my journey into investing, stock trading, a BTC I had never read a single book or paper on economics. I never took a class in high school, college or any level of education. So I entered my learning with a completely clean slate.

                Although I started my personal finance/investing education around 2009 by reading the Coffee House Investor (still a book I recommend to everyone) and eventually found the Bogleheads and WCI, I did not learn anything about economics until about 2012 with the vast majority of my self education coming after 2014.

                I have since read about the history of Keynesian and Austrian economics yes. Although I wouldn't identify as a loyalist of either, the Austrian Economics folks have definitely been "more right" over the past 15 years.

                My point with the question about the history of money was to determine a starting point. If someone has no education on the history of money, but believes that the US dollar will remain the global world reserve currency forever, then there is little reason to continue the conversation as I strongly disagree with that statement. I think anyone who has studied history will come to the same conclusion. But, I find it a waste of time to convince anyone that their strongly held opinions might be wrong. Just like I don't engage in people's strongly held political beliefs surrounding things like abortion, Trump, Biden, Gay Marriage etc etc etc. It's not worth my time.
                Last edited by NapoleanDynamite; 01-26-2022, 12:40 PM.

                Comment


                • I'm a bit of an Austrian at heart but you have to admit they have been largely wrong forever. It turns out - and social media have proved it - that most people are pretty willing to accept whatever they are told. Thus trust in fiat currencies can remain high longer than you can remain solvent, to paraphrase Keynes.

                  My hedge against USD hegemony is to own market weight equities, more than 50% of my equity allocation. I believe I don't know what the next reserve currency will be and neither do you. The problem with BTC as hedge is that it is really attempting to replace gold and doesn't have either the cultural or historical gravitas to do that; and besides is quite ripe for fraud and manipulation. I certainly wouldn't bet on this replacement happening any time soon. The contrary argument - that BTC is going to offer massive speculative returns - is just a WAG and of course totally incompatible with the first idea of replacing the USD as reserve currency. It's either going to be a store of value - stable pricing power - or it's going to have massive returns. It can't be both.

                  What you do with 1-5% or 100% of your money is totally up to you. I have not been persuaded by any argument that BTC should be any part of my portfolio beyond whatever amount my index fund investments might hold.

                  Comment


                  • I am very willing to bet that the US dollar is not going to be the world currency forever. I don't think anybody thinks that. Governments and countries rise and fall. However over the rest of my lifetime that is a much harder question. And that is what really matters to me.

                    Comment


                    • Originally posted by Lordosis View Post
                      I am very willing to bet that the US dollar is not going to be the world currency forever. I don't think anybody thinks that. Governments and countries rise and fall. However over the rest of my lifetime that is a much harder question. And that is what really matters to me.
                      I also have no idea if the USD will fall in my lifetime...but if I had to bet, I would bet it will fall in my children's lifetime if not mine. Who knows though. Maybe you are older than me...maybe you don't have children. If I was 75 with no kids or grandkids, then I wouldn't care one "bit" about Bitcoin. I would just be blowing my money on fun!

                      Comment


                      • Originally posted by FIREshrink View Post
                        I'm a bit of an Austrian at heart but you have to admit they have been largely wrong forever. It turns out - and social media have proved it - that most people are pretty willing to accept whatever they are told. Thus trust in fiat currencies can remain high longer than you can remain solvent, to paraphrase Keynes.

                        My hedge against USD hegemony is to own market weight equities, more than 50% of my equity allocation. I believe I don't know what the next reserve currency will be and neither do you. The problem with BTC as hedge is that it is really attempting to replace gold and doesn't have either the cultural or historical gravitas to do that; and besides is quite ripe for fraud and manipulation. I certainly wouldn't bet on this replacement happening any time soon. The contrary argument - that BTC is going to offer massive speculative returns - is just a WAG and of course totally incompatible with the first idea of replacing the USD as reserve currency. It's either going to be a store of value - stable pricing power - or it's going to have massive returns. It can't be both.

                        What you do with 1-5% or 100% of your money is totally up to you. I have not been persuaded by any argument that BTC should be any part of my portfolio beyond whatever amount my index fund investments might hold.
                        I don't know that I would say the Austrians have been completely wrong...but yes, the Keynesians have done just fine for a long long time. I just happen to think that time is coming to an end. And you are absolutely right that most people are willing to accept what they are told. Ironically I would have preferred if I would have never needed to learn about these things. The 2008 financial crisis really made me (and many others) start to question the system and say "WTF is going on here?" Turns out the 2008 crisis was a symptom...not the cause.

                        As for what will the next reserve currency be, you are right that I have no clue. But having put some philosophical thought into it, the likely contenders IMO are: 1. The Chinese Yuan/CBDC 2. A future Russian CBDC 3. A return to a global gold standard. 4. A new US Dollar equivalent 5. BTC 6. Another countries monetary equivalent.

                        If you start to think all of these options through to their logical conclusion BTC is the most optimistic option.
                        1. Chinese CBDC - this would mean that China now has financial control of all global wealth. It would take a massive losing WW for this to occur. Russia, the US, and the European Union amongst others would do everything they can to prevent this.
                        2. Russian CBDC - Same as option 1 except switch out Russian and China in this option and it would be following a war that Russia wins
                        3. Very unlikely as the logistics of this make very little sense. But Russia, China, and likely the US accumulating a ton of gold in their reserves is an argument for this hypopthesis to occur.
                        4. See options one and two but the US wins a war and keeps its dollar hegemony for some time longer, but it will have to look a lot different than the current situation. So I would argue this is a different "currency" even if the US govt still controls it.
                        5. BTC - Logistically far simpler than returning to a gold reserve. Capped reserve and game theory plays out as to which countries control the majority of the wealth. Eventually production is rewarded and countries grow more or less wealthy based on the productive force of the country. Played out on a long enough time frame it actually prevents wars between super powers and may even break down global borders. Obviously this is utopian view of BTC.
                        6. Another country rises to take over reserve status....Unlikely to happen as one of the other major superpowers would likely take control first. Possible that Eurozone unites and tries to reclaim a reserve status with a "Euro" equivalent. Again unlikely due to military powers and natural resource/productive ability of other countries in comparison to a United Eurozone. India theoretically has the man power and some of the natural resources, but doesn't currently have anywhere near the military capacity to take over one of the other major powers.

                        All of this is honestly just mental math and trying to look in to a crystal ball. But eventually something is more likely to break beyond repair and change will occur. When that happens...who knows.

                        As for your claims that BTC is ripe for fraud and manipulation, I totally disagree with that statement. This is painfully true for "crypto's"....but I would disagree with this statement in regards to BTC. I would also push back with your opinion that BTC is just trying to replace gold. This is a myopic view IMO even though Saylor wants to publicly state that repeatedly. And it can definitely have massive returns and still be a store of value. These are not mutually exclusive. The definition of Store of Value is: A store of value is an asset, commodity, or currency that maintains its value without depreciating.

                        It says nothing about lack of appreciation. Only that it should not depreciate. Over any 4 year period in the history of BTC it has never had it's value depreciate. If someone is trading it on shorter time frame, then I would argue they are not using it as a store of value.

                        Comment


                        • One thing I really struggle with about BTC is how to store it. I mean I think the coinbase vault seems like my best option. Keeping it on a hardware wallet like a trezor is great in theory but anytime you have a wallet then you also have to have your seed phrase stored somewhere. Where to store it? In your house? bank deposit box? I certainly wouldn't sleep well if I had any large amount(>50k) in BTC and the key to that was just sitting in my house somewhere.

                          Split up the seed phrase? Use multi sig? What about when you die? Well you had to tell someone where your seed phrase/wallets were so they could presumably steal them at anytime even before your death (divorce/fallout with kids or family). And the problem is once its gone its gone. Theres no way to get it back. I think these problems are such large risks that are never talked about.

                          Comment


                          • Originally posted by CREGuy View Post


                            Again I am not anti-crypto, but like most things, the reality is likely somewhere between the "HODL" crowd and the "worthless" crowd. At this point I don't think any crypto can be considered anything more than a speculative play. That's not a knock, just a reality. Speculative plays can certainly have a spot in a portfolio, but should be treated as such. I think the scary thing right now is how many people are taking a disproportionate stake in these speculative investments based on trying to replicate what essentially amounts to a bunch of lottery winners who happen to fall into BTC very early on.
                            Be careful who you say that too. You'll be labeled as anti-crypto and followed around on Twitter and your own blog by the true believers who will repeatedly tell you how stupid you are.
                            Helping those who wear the white coat get a fair shake on Wall Street since 2011

                            Comment


                            • Originally posted by FIREshrink View Post

                              My hedge against USD hegemony is to own market weight equities, more than 50% of my equity allocation. I believe I don't know what the next reserve currency will be and neither do you.
                              Exactly. This whole argument that you have to buy BTC now in case the USD stops being the reserve currency is dumb IMHO. First, those changes have historically been fairly gradual. But mostly, if everyone starts using Yen or Yuan or Rupees or Bitcoin, then I'll start getting my paychecks in BTC and when I sell stocks or real estate I'll get BTC instead of dollars. No biggie. Only a tiny fraction of my wealth sits in actual dollars, although I do have some US bonds in the portfolio.
                              Helping those who wear the white coat get a fair shake on Wall Street since 2011

                              Comment


                              • Originally posted by ERRES2288 View Post
                                One thing I really struggle with about BTC is how to store it. I mean I think the coinbase vault seems like my best option. Keeping it on a hardware wallet like a trezor is great in theory but anytime you have a wallet then you also have to have your seed phrase stored somewhere. Where to store it? In your house? bank deposit box? I certainly wouldn't sleep well if I had any large amount(>50k) in BTC and the key to that was just sitting in my house somewhere.

                                Split up the seed phrase? Use multi sig? What about when you die? Well you had to tell someone where your seed phrase/wallets were so they could presumably steal them at anytime even before your death (divorce/fallout with kids or family). And the problem is once its gone its gone. Theres no way to get it back. I think these problems are such large risks that are never talked about.
                                So where exactly are you keeping all the Bitcoin then? As opposed to your other valuables. Be as precise as possible.. you know, for education purposes….

                                Click image for larger version  Name:	273A91B9-0109-4190-B191-BA5B433DB6AB.jpg Views:	0 Size:	22.9 KB ID:	316859
                                A man is not Jaqen McCatBurgler.
                                Last edited by Jaqen Haghar MD; 01-27-2022, 06:04 PM.

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