Author Topic: Do you think Bitcoin is a safe store of value?  (Read 119536 times)

hobbit

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Re: Do you think Bitcoin is a safe store of value?
« Reply #510 on: December 15, 2017, 08:42:33 PM »

Very good stuff in this blogpost.
Thanks for posting.

SD

You're welcome.

@DeepSouth can you understand you're a masochist from my point of view? Anyway, let's just all vote with our wallets and things will work out at some point :)

I honestly don't understand your point of view. I'd say the empirical end result of your policy desires leads to decade long depressions and wild and violent swings in inflation and deflation. It's not masochism to desire an entity with the power to smooth out economic cycles and encourage growth. The federal reserve is one of the few things the US government gets mostly right. If you're terrified of your savings being withered away by low single digit inflation but don't want principal risk for your savings buy TIPS.

I own bitcoin because I think the risk/reward is fair from here even though I think most bullish arguments for bitcoin are very stupid.

The policy of the last ~120 years led to huge bubbles and (long! 20+ years at times) subsequent recesions while an organic market won't have recesions lasting longer than a few years. I concider loving that ewuivalent with loving pain.

On top of that an organic market rewards its participants more fairly in the sense that good decisions lead to financial reward while the current system rewards having the right contacts at the policy maker for the most part.

even though I disagree with you completely, I think its beyond the point right now since bitcoin core has a zero chance of being a viable currency due to technical limitations. On top of that bitcoin's inability to replace gold gives it a total value of 0. Good luck
« Last Edit: December 15, 2017, 09:37:09 PM by hobbit »


LongHaul

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Re: Do you think Bitcoin is a safe store of value?
« Reply #511 on: December 17, 2017, 06:23:00 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

JRM

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Re: Do you think Bitcoin is a safe store of value?
« Reply #512 on: December 17, 2017, 06:32:01 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

You hold it and wait for the greater fool to come along.

Spekulatius

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Re: Do you think Bitcoin is a safe store of value?
« Reply #513 on: December 17, 2017, 06:32:41 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

A guy in a basement will create a new one  a couple days later.

If you think about it, mining for gold isnít very productive either, thatís one reason why the gold standard isnít really feasible. It makes no sense to couple wealth with the amount of gold that can be mined, or just as much sense than mining for a artificial limited number of crypto keys.

Itís quite easy to create a new crypto currency, much easier than finding and building a new gold mine though.
To be a realist, one has to believe in miracles.

Jurgis

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Re: Do you think Bitcoin is a safe store of value?
« Reply #514 on: December 17, 2017, 07:04:40 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

That's why you should buy all cryptokitties instead. Then you have the greatest cryptop.... kitty harem in the world!  8)
"Before you can be rich, you must be poor." - Nef Anyo

SharperDingaan

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Re: Do you think Bitcoin is a safe store of value?
« Reply #515 on: December 17, 2017, 07:41:13 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

I use my bribe, extortion, AML/ATF, and despot money to buy the untraceable token; then find a willing banker to make a collateral backed loan to a number of little old ladies. Who withdraw the money in cash to pay for a trip somewhere - creating untraceable wealth assembly, and near to untraceable distribution ;)

SD

rkbabang

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Re: Do you think Bitcoin is a safe store of value?
« Reply #516 on: December 17, 2017, 07:56:22 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.


Thatís like saying you are going to buy up all the gold in the world for itís current market cap. Do you know what would happen to the price if you tried?  Youíd send the market cap of crypto into the 100s of trillions. And once you did own all the gold or all the crypto the only thing you could do is sell/spend it for a lot less then you bought it for. Unless you like starring at your blockchain or fondling your cube.

John Hjorth

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Re: Do you think Bitcoin is a safe store of value?
« Reply #517 on: December 17, 2017, 08:13:03 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

I use my bribe, extortion, AML/ATF, and despot money to buy the untraceable token; then find a willing banker to make a collateral backed loan to a number of little old ladies. Who withdraw the money in cash to pay for a trip somewhere - creating untraceable wealth assembly, and near to untraceable distribution ;)

SD

lol. I have always liked your posts here on CoBF, SharperDingaan.

First time, you got me really puzzled was when you were playing the dice with Deutsche Bank. And now Bitcoin. However, I must say, that I do not any longer believe, that you have devoted your [full] time and energy to the rollout of blockchain worldwide.
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SharperDingaan

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Re: Do you think Bitcoin is a safe store of value?
« Reply #518 on: December 17, 2017, 08:27:51 AM »
So if I buy up all the cryptocurrency in the world for say $500b then what do get out of them?  Nothing.

I use my bribe, extortion, AML/ATF, and despot money to buy the untraceable token; then find a willing banker to make a collateral backed loan to a number of little old ladies. Who withdraw the money in cash to pay for a trip somewhere - creating untraceable wealth assembly, and near to untraceable distribution ;)

SD

lol. I have always liked your posts here on CoBF, SharperDingaan.

First time, you got me really puzzled was when you were playing the dice with Deutsche Bank. And now Bitcoin. However, I must say, that I do not any longer believe, that you have devoted your [full] time and energy to the rollout of blockchain worldwide.

Just an updated learning from interesting conversations of many years ago.
As they say - always try to learn from the very good.

SD

SharperDingaan

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Re: Do you think Bitcoin is a safe store of value?
« Reply #519 on: December 18, 2017, 08:15:47 AM »
We sold the remaining 25% of our Bitcoin this morning.
A little under 3 token at an average price of USD 18,810. 

The sale was to capture the run-up from the CME opening for business. 

Our view is that there is little reason for a market maker to be long Bitcoin at anything near current levels. The holding can now be widely replicated through either futures or options with built in margin, a much lower regulatory capital requirement, and perhaps even a lower carry cost as well. RAROC favors investment via derivatives - not via a long position in Bitcoin.

The presence of CME/Cboe derivatives has now made Bitcoin investment 'scaleable'. Institutions can now trade in/out, with liquidity, without materially impacting the price of Bitcoin itself. The result is that the only natural buyers of Bitcoin are now 1) those that actually need it, and 2) investors who can't use a derivative.

To get USD18,000+/Bitcoin, existing owners have to hold back their Bitcoin in anticipation of higher prices - much less likely now.
But any small increase in supply will rapidly accelerate as price starts collapsing; with circuit breakers and global trading actually helping the process by damning up prospective sales as word gets out around the world. Global waves of selling feeding a brush fire until the fuel eventually burns out - is a harsh but desirable outcome, and the earlier it is - the better for everyone.

At USD5,000+/Bitcoin, it's much easier for a market maker to justify holding a few Bitcoin directly - but until then; the market maker has to justify that high price/high maintenance holding daily, to an increasingly nervous senior management. Career risk suggests that there are real limits as to how long this can go on for.

If we're right, we do very well. If we're wrong, we don't think we're giving up much.
We live in interesting times.

SD

     
« Last Edit: December 18, 2017, 08:20:39 AM by SharperDingaan »