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What have you learned about bitcoin?

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  • What have you learned about bitcoin?

    If you have purchased a trainer token  of Bitcoin, read CoinDesk, or desire to learn, who/what source has been your most enlightening? I'm framing this as a long-term alternative asset or global currency. It's been around for 9 years; looks like it will  persist.

  • #2
    Careful with the performance chasing. Just because it persists does NOT mean buying now after a 1700% run up this year is a wise move. There are no called strikes in investing.
    Helping those who wear the white coat get a fair shake on Wall Street since 2011

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    • #3
      Here is Larry Swedroe's analysis of bitcoin:

      http://www.etf.com/sections/index-investor-corner/swedroe-bitcoin-its-risks?nopaging=1

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      • #4
        I have read a great article on bitcoin/eth that makes it very clear what it is and isnt. Its excellent, https://blog.chain.com/a-letter-to-jamie-dimon-de89d417cb80

        Obviously right now its a huge speculative bubble as we mentioned earlier this year (about 1700% ago,  :cry: ) and that can be very profitable. I just never felt comfortable with the exchanges and their safety, nor felt like I had money to burn as that would be the appropriate category for it. I kept trying to pin a number on some money I was realistically okay with seeing disappear, but turns out it was zero.

        There is another way to do it in your regular accounts with the investment trust, it comes at a premium, but probably well worth it given your other options.

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        • #5
          Love it. Turns out it was zero. There have been many times in my life when I felt the same. I'm willing to take flyers more now, but I still try to be smart and do it on stuff that I wouldn't mind holding for a decade if there were no way to sell it.
          Helping those who wear the white coat get a fair shake on Wall Street since 2011

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          • #6




            If you have purchased a trainer token  of Bitcoin, read CoinDesk, or desire to learn, who/what source has been your most enlightening? I’m framing this as a long-term alternative asset or global currency. It’s been around for 9 years; looks like it will  persist.
            Click to expand...


            I've learned that block chain technology is what's valuable and likely to persist.  Bitcoin is just one example of this and not necessarily the one that will stick around.  Though I do suspect it will, I don't plan on putting dollars into it.

            I considered getting into it years ago actually.  My brother in law is a big nerd and had a small bitcoin miner in his house that peaked my interest.  But, when I started really thinking about it, it just didn't seem like a safe move.  Not that many places accepted bitcoin as payment back then and I didn't really have any interest in buying and holding it (of course now I wish I had, but I know I would have sold it off long before it reached these prices).

            Anyway, now what's keeping me from getting in on it other than the ridiculous balloon (+1700% is craziness), is that the whole idea of buying it with dollars and then hoping it will grow into more dollars kind of defeats the purpose of why it was invented in the first place.  It was meant to replace our current banking system and currency.  It doesn't make much sense to me that people just want to buy and sell it like a stock.  You're not investing in shares of a company.  And now that it's proven to be so wildly volatile, it doesn't even make sense to use it as currency anymore, which was the whole point of inventing it in the first place!  Imagine if you used bitcoin to buy something 2 weeks ago for $100 in bitcoins, this week you'd be feeling like you got totally ripped off (because those same bitcoins would be worth so much more had you not used them to buy stuff).

            I plan on watching from the sidelines.

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            • #7
              I am taking a pass.  When Buffet buys some bitcoin then maybe.  It is not different this time.  This is obvious tulip bulb. Of course I heavily invested in tech stocks in the 90s so I could be wrong again.

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              • #8
                For those interested, there's a great Ted talk about block chain that I found very helpful for sort of understanding it all.

                https://www.youtube.com/watch?v=Pl8OlkkwRpc

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                • #9




                  Here is Larry Swedroe’s analysis of bitcoin:

                  http://www.etf.com/sections/index-investor-corner/swedroe-bitcoin-its-risks?nopaging=1
                  Click to expand...


                  That's an excellent summary, thx for sharing

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                  • #10
                    I see people that have no idea what bitcoin is and that have NEVER been involved in investing that is now getting into bitcoin. That's the final sign that it isn't for me. I like to look at my signature quote in times like this.

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                    • #11
                      The TL;DR for my article is that the value of blockchain/btc is uncensored payments, aka, capital flight and money laundering, etc...ethereum is a platform for making decentralized applications.

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                      • #12
                        Exactly 2 years ago an acquaintance who loves bitcoin (his whole retirement was in it, which means he has retired now) sent me a few cents worth to get me started. It is today worth $22. Can't imagine the crazy profits.

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                        • #13




                          Exactly 2 years ago an acquaintance who loves bitcoin (his whole retirement was in it, which means he has retired now) sent me a few cents worth to get me started. It is today worth $22. Can’t imagine the crazy profits.
                          Click to expand...


                          Hope he's cashing in on it now, lol.  His entire portfolio is in bitcoin?  Wow.  He must have nerves of steel.

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                          • #14
                            Most people sensibly tell you to avoid bubbles. I think if you are a risk taker, it can be interesting to dabble in it but you have to control your risk.

                            My strategy with bubbles is to buy a small amount when I hear about a bubble. I figure if you are vaguely switched onto financial news, you probably are not likely the last person to hear about it.

                            So I bought 2 bitcoins when I first heard Robert Schiller describe it as a bubble. I sold about $7000. I think it is now $15,000.

                            What I find interesting is at what point I could safely short 2 bitcoin. I think the terminal value is likely to be zero. But it could go to $500,000 or something crazy. So if I shorted 2 bitcoin now at 15,000, I would have to set aside 1M in margin, which is a not acceptable considering the potential profit is only
                            30k, although the probability is high from my reckoning.

                            Someone commented well recently saying that shorting bitcoin here is tempting but like taking on Mike Tyson at his prime. It's fascinating to watch though and perhaps a better entry to short will emerge at some stage.

                            My wife did suggest to buy $100 bitcoin when it was $1. I don't expend much energy regretting it because who could know it would become a bubble then ? That would be like regretting you didn't buy the winning lotto ticket.

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                            • #15
                              I have learned that it's a bubble.

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