Bitcoin is still early

[jfoxcpacfp]

I'm going to have to go back and watch that movie again. Everybody thought ND and my son, Matthew, looked like twins when it came out...same mannerisms and Matt could break out into the dance at any time. It made it all that much funnier.

[MMM]

Is it only possible to invest in Bitcoin through Coinbase? Any Bitcoin proxies one can buy on TD AMeritrade?

[Hatton]

WSJ 1 billion in bitcoins hacked from silk road founder now confiscated by the feds. This might affect the price today.

[NapoleanDynamite]

Is it only possible to invest in Bitcoin through Coinbase? Any Bitcoin proxies one can buy on TD AMeritrade?

Coinbase is not the only exchange. Kraken and Swan Bitcoin are a couple of the other exchanges and both much better than coinbase IMO. Coinbase is one of the easiest to use and biggest exchange companies.

If you want to use TD ameritrade, you would have to buy Grayscale Bitcoin Trust (GBTC). This is technically not buying bitcoin, but is an easy way to get some exposure through retirement or trading accounts.

Paypal and Robinhood both use systems that are not yet complete for buying BTC. Personally, I would stick to the other routes.

An alternative route would be to buy Microstrategy Stock (MSTR). This company just put their entire treasury reserve into BTC. (425 million dollars worth). You would not only be buying the company, but they have essentially turned themselves into a Bitcoin ETF (my opinion here). This would be buying an individual stock of course and I'm not recommending this route. Just letting you know your options if you want some exposure to Bitcoin.

[NapoleanDynamite]

WSJ 1 billion in bitcoins hacked from silk road founder now confiscated by the feds. This might affect the price today.

I'm not sure what you are talking about here...but FYI this is physically impossible. There are only 18 million (not billion) bitcoin that have been mined at this point. There will only ever be 21 million. So to suggest that 1 billion have been "hacked" is a ridiculous statement.

[Nysoz]

I'm not sure what you are talking about here...but FYI this is physically impossible. There are only 18 million (not billion) bitcoin that have been mined at this point. There will only ever be 21 million. So to suggest that 1 billion have been "hacked" is a ridiculous statement.

https://www.vice.com/en/article/akdgz8/us-feds-seize-1-billion-in-bitcoin-from-wallet-linked-to-silk-road

[CordMcNally]

I'm not sure what you are talking about here...but FYI this is physically impossible. There are only 18 million (not billion) bitcoin that have been mined at this point. There will only ever be 21 million. So to suggest that 1 billion have been "hacked" is a ridiculous statement.

$1 billion in Bitcoin, not 1 billion Bitcoins.

[FreshPaint]

I listened to the posters on this forum and sold my bitcoins a few months ago at 9.5k a coin. Bought in at 1-2.5k a coin.

Made 40k profit after capital gains tax which I reinvested into VTSAX.

Although I wish I still had them, I would be facing the same decision today of what to do with it.

For anyone wanting to buy bitcoins, I would highly recommend Gemini which is the exchange founded by the Winklevoss twins. Getting the bitcoins sold and cash transferred to my checking account was no different than using Vanguard.

[abds]

Some people advocate 1% of your portfolio for it which doesn't make much sense to me. Even if it doubles or triples in value, it doesn't move your net worth by much. On the odd chance it 10x from here, even then still doesn't move things very far.

Gotta play big to win big. Which I’m not willing to do with Bitcoin.

[NapoleanDynamite]

Gotta play big to win big. Which I’m not willing to do with Bitcoin.

I disagree...

If one allocates 1% of their portfolio to something that then goes 10X in 1 year and the other 99% to the S/P which makes 7% on the year, you increase your return from 7% to 15%. Obviously a huge difference. Compound at 15%/year or compound at 7%/year... Now compare this to a total loss of Bitcoin all the way down to zero. Your yearly return is then 6% instead of 7% for one year. A very small difference. Play small and win big. Also, the 1% allocation at 10x return quickly becomes the majority of your portfolio. It is very possible that Bitcoin price will 10X over the next 12 months.

Let's play this game more fully....and use numbers that others might expect to be more "realistic". Lets hypothesize that Bitcoin goes 10x over the next 5 years instead of the next 1 year. With a 1% Bitcoin allocation, this is still taking your annual return over 5 years from 7% (indexed S/P) to almost 9%. On the down side, if Bitcoin loses 50% of its value over the next 5 years you have now taken your yearly return from 7% yearly to about 6.9% yearly. It is a fractional difference less.

This risk/return here is highly assymetric. To answer a prior question, I started my position with an allocation at 5% which I brought quickly to 7.5% and it is now over 10% from growth. At this point I am DCA-ing 15% of my retirement contributions monthly to BTC and my only anxiety is that I will regret not DCA-ing more. If you have the mentality that this is "gambling" or "betting" on Bitcoin, it is not. This is a very calculated risk that people should educate themselves on. All investments have risk.

[childay]

I disagree...

If one allocates 1% of their portfolio to something that then goes 10X in 1 year and the other 99% to the S/P which makes 7% on the year, you increase your return from 7% to 15%. Obviously a huge difference. Compound at 15%/year or compound at 7%/year... Now compare this to a total loss of Bitcoin all the way down to zero. Your yearly return is then 6% instead of 7% for one year. A very small difference. Play small and win big. Also, the 1% allocation at 10x return quickly becomes the majority of your portfolio. It is very possible that Bitcoin price will 10X over the next 12 months.

Let's play this game more fully....and use numbers that others might expect to be more "realistic". Lets hypothesize that Bitcoin goes 10x over the next 5 years instead of the next 1 year. With a 1% Bitcoin allocation, this is still taking your annual return over 5 years from 7% (indexed S/P) to almost 9%. On the down side, if Bitcoin loses 50% of its value over the next 5 years you have now taken your yearly return from 7% yearly to about 6.9% yearly. It is a fractional difference less.

This risk/return here is highly assymetric. To answer a prior question, I started my position with an allocation at 5% which I brought quickly to 7.5% and it is now over 10% from growth. At this point I am DCA-ing 15% of my retirement contributions monthly to BTC and my only anxiety is that I will regret not DCA-ing more. If you have the mentality that this is "gambling" or "betting" on Bitcoin, it is not. This is a very calculated risk that people should educate themselves on. All investments have risk.

I think you are missing the point about 1% allocation. That would typically imply you would have to rebalance (sell) once BTC was overlarge.
What is your target BTC allocation and rebalance strategy?

[NapoleanDynamite]

I think you are missing the point about 1% allocation. That would typically imply you would have to rebalance (sell) once BTC was overlarge.
What is your target BTC allocation and rebalance strategy?

Not missing the point....I just did simple math for the example. Re-balance if you so choose and you might improve your return, or you might make it worse.

When S/P, NASDAQ, US Dollar, Gold, Real Estate or any other asset class start gaining, instead of losing value when priced in Bitcoin, I will consider re-balancing. Yes they have all lost value when priced in Bitcoin in 2020.

In other words, when I see something that can act as a better store of value, hedge against inflation, has more upside potential and a better risk profile I will start re-balancing my Bitcoin position. So far there is nothing that fits this criteria.

[DrSam]

I almost bought about 50k USD worth of Bitcoin back in mid 2014 when it was somewhere around 500-600 buck per coin. Wasn't looking at it as any sort of investment, but rather was trying to figure out how to get money in my Chinese bank account out of the country, as I was leaving. China has some pretty difficult currency controls. Like the Donald, I think I still have a bank account there, but if it still exists, it now only has a small amount of money left in it that is just sitting there dormant.

I don't feel like I understand Bitcoin well enough to consider buying any now, but it's fun to imagine where I'd be now if I'd bought it then and still held it.

[NapoleanDynamite]

I almost bought about 50k USD worth of Bitcoin back in mid 2014 when it was somewhere around 500-600 buck per coin. Wasn't looking at it as any sort of investment, but rather was trying to figure out how to get money in my Chinese bank account out of the country, as I was leaving. China has some pretty difficult currency controls. Like the Donald, I think I still have a bank account there, but if it still exists, it now only has a small amount of money left in it that is just sitting there dormant.

I don't feel like I understand Bitcoin well enough to consider buying any now, but it's fun to imagine where I'd be now if I'd bought it then and still held it.

Portability is one of its greatest qualities. You have already learned that based on your above comment. I too missed out, but at $350 when I was instructed by a very good friend who happens to be an investor worth over $100 million. I told him I thought it was a Ponzi scheme and I didn't understand it. Then I watched it balloon to 20K and decided I better learn about it. It was extremely costly to ignore my friends advice. 6 years from now you will be saying the exact same thing. "I should have bought it at 15K". Spend some time learning and invest what you are comfortable with. The information is much better and more easily accessible now than it was in 2014.

[childay]

Not missing the point....I just did simple math for the example. Re-balance if you so choose and you might improve your return, or you might make it worse.

When S/P, NASDAQ, US Dollar, Gold, Real Estate or any other asset class start gaining, instead of losing value when priced in Bitcoin, I will consider re-balancing. Yes they have all lost value when priced in Bitcoin in 2020.

In other words, when I see something that can act as a better store of value, hedge against inflation, has more upside potential and a better risk profile I will start re-balancing my Bitcoin position. So far there is nothing that fits this criteria.

In other words, you don't have an allocation %, hence missing the point about 1%. Good luck hopefully works out, honestly no sarcasm