Crypto’s $600B Crash Hits a New Low(bloomberg.com)
bloomberg.com
Crypto’s $600B Crash Hits a New Low
https://www.bloomberg.com/news/articles/2018-08-08/bitcoin-tumbles-to-3-week-low-as-sec-postpones-etf-decision
110 comments
A serious % of btc is near pure cult. So much time and energy wasted for the prospect of quicksilver it's insane.
Ignoring all of BTC's significant issues for a moment, there are a lot of groups in Bitcoin. One of those is the fairly average, tech-savvy want-to-be-investor, who has a little bit (but not a lot) of disposable income and wants to do something with it that's better than the 2% annual yield of ... pretty much everything else.
With BTC, you could buy in at almost any amount, get out whenever you wanted, and transfer fees were pretty low. Those aren't common traits for most other investment vehicles.
It's kind of a side effect of so much capital being locked up in a smaller and smaller percentage of the population. The folks closer to the bottom are clawing at anything that might improve their situation a little, even if it comes with a lot of risk.
With BTC, you could buy in at almost any amount, get out whenever you wanted, and transfer fees were pretty low. Those aren't common traits for most other investment vehicles.
It's kind of a side effect of so much capital being locked up in a smaller and smaller percentage of the population. The folks closer to the bottom are clawing at anything that might improve their situation a little, even if it comes with a lot of risk.
The S&P 500 has a ~10% annual return (7% adjusted for inflation) as a historical average. 2% is what you can get in a savings account with no risk at this point.
Index funds/ETFs allow anyone to invest in the stock market starting with small amounts of money.
Index funds/ETFs allow anyone to invest in the stock market starting with small amounts of money.
It's shocking how much of that gets eaten up by investment fees when you're only investing a small amount of money.
It's also amazing how small investment fees can become.
It's also amazing how small investment fees can become.
If you're losing much of that to fees, you're investing in the wrong funds with the wrong firms. Vanguard, Fidelity, Schwab: no fee, low-expense ratio total market index funds. In my target retirement fund, I'm paying $16 per year per $10,000 invested, and that's not the lowest ER fund you can find.
Many employees find themselves forced to select between a narrow selection of mutual funds from their employee provided RSP.
Unless they forego their employee contribution to the RSP, they have very little flexibility.
Unless they forego their employee contribution to the RSP, they have very little flexibility.
Low quality fund options in employer provided retirement account are a problem, but in the U.S. you can roll it over into a self-controlled IRA at whatever provider you like once you change employers, so for most people the number of years it'd be subject to those higher fee funds is not too high, at least.
I completely agree with everything you said.
But not everyone can do a triple flip with a half twist while navigating the financial system.
i.e. I think I reworded my original comment in reverse.
But not everyone can do a triple flip with a half twist while navigating the financial system.
i.e. I think I reworded my original comment in reverse.
It's not very complicated at all, the issue is more a lack of education. Online personal finance resources and communities help a lot, but people still have to know to seek out that information.
And bitcoin has made 100000% in 9 years. Its all a matter of timing.
Bitcoin is up quite a bit, but it's total returns are negative as every dollar out is a dollar someone else up in and mining + transfer fees is a huge expense.
It's possible to win big at negative sum games, but by definition not everyone can.
It's possible to win big at negative sum games, but by definition not everyone can.
One is investing, one is speculation/gambling.
Some people got very lucky. Some people lost their life savings.
In the stock market with diversified investments, even if the market crashes, historically you would have always recovered and then some within not very many years so long as you didn't do the stupid thing and panic and sell during the crash in an attempt to time the market.
Some people got very lucky. Some people lost their life savings.
In the stock market with diversified investments, even if the market crashes, historically you would have always recovered and then some within not very many years so long as you didn't do the stupid thing and panic and sell during the crash in an attempt to time the market.
That would depend on if you had a basket of stocks representative of the whole market and rebalanced your portfolio throughout a downturn (not common at all). Companies can and do go bankrupt. Historically, the same has been true of Bitcoin, where it always recovers to a new base.
Throughout this conversation I've been referring to index funds and the S&P 500.
«In the stock market with diversified investments, even if the market crashes, historically you would have always recovered and then some within not very many years so long as you didn't do the stupid thing and panic and sell during the crash in an attempt to time the market.»
Same with Bitcoin. There is no difference between the all-time SP500 chart and the all-time BTC price chart. In both cases, historically anyone who holds long enough ("within not very many years") eventually makes money:
• https://dividendtotalreturn.net/wp-content/uploads/2017/08/C...
• http://bitcoin.zorinaq.com/price/
I'm not saying people should dump their savings into BTC, just that your argument isn't a good argument to defend the SP500. An SP500 index fund is great for other reasons, namely: it has a great track record and you can't really go wrong with investing in ~500 of the biggest American companies.
Same with Bitcoin. There is no difference between the all-time SP500 chart and the all-time BTC price chart. In both cases, historically anyone who holds long enough ("within not very many years") eventually makes money:
• https://dividendtotalreturn.net/wp-content/uploads/2017/08/C...
• http://bitcoin.zorinaq.com/price/
I'm not saying people should dump their savings into BTC, just that your argument isn't a good argument to defend the SP500. An SP500 index fund is great for other reasons, namely: it has a great track record and you can't really go wrong with investing in ~500 of the biggest American companies.
This is a pretty ridiculous argument to throw your weight behind given that there is a significant difference in timescale: 61 years vs. 9 years.
...which is why I said it had a great track record :) The problem I had with your post is that you implied long-term BTC holders were not recovering their investment, which is plain wrong.
That wasn't my intended implication, I was suggesting just that in the long term there's a far greater track record of positive growth in the traditional stock market compared to Bitcoin.
The value of any particular coin is pure marketing. Anyone can start a coin. There is literally an infinite supply. The only thing giving them vale us popularity, and marketing is what drives popularity.
Token price speculation (aka "crypto investing") is much more about marketing than it is about technology. This is why you see cult-like marketing attempts.
Token price speculation (aka "crypto investing") is much more about marketing than it is about technology. This is why you see cult-like marketing attempts.
I'm not thinking of marketing attempts, more about the behavior of people. All monitoring that weird curve and doing random acts to grab bonuses nervously. Making up theories on the fly about what is going on or not. Listening to those who had luck or were there since long ago.
Another aspect, gambling (because most of it [trading] is gambling) can have immense distortion power over your brain. When you have money and high frequency random noise .. you're in for a nice emotional rollercoaster.
Another aspect, gambling (because most of it [trading] is gambling) can have immense distortion power over your brain. When you have money and high frequency random noise .. you're in for a nice emotional rollercoaster.
This note is legal tender for all debts public and private.
Is not pure marketing.
Is not pure marketing.
Fiat currency gets value from the fact that it is legally required ('by fiat') to use. There is no such requirement for tokens.
Usually that same % doesn't understand the tech AT ALL. They repeat the same koolaid about "Money not managed centrally by the government"
Honestly I don't know. What part of bitcoin has any meaning in relation to trading ? Some people go deep, they understand pools, fees, advanced in ASICs, advances in bot tricks .. yet it feels super random.
It's amusing how confused come of the cultists are at the price dropping with no reason, forgetting that it went up with no apparent reason either
> Crypto is simply too risky as a way of storing money and trading.
And when its not risky the price will be higher because so many other people will be storing and trading it safely.
Thats the real bet.
If it fits your risk profile then you have it, and probably have had it since 2012 because the fundamentals were the same then as they are now. If you weathered the risk back then you'll weather it now where its a lot less risk.
And if today's lack of risk still doesn't fit your risk profile, then you have to wait. Simple.
And when its not risky the price will be higher because so many other people will be storing and trading it safely.
Thats the real bet.
If it fits your risk profile then you have it, and probably have had it since 2012 because the fundamentals were the same then as they are now. If you weathered the risk back then you'll weather it now where its a lot less risk.
And if today's lack of risk still doesn't fit your risk profile, then you have to wait. Simple.
> If I pay with a credit card I have level of protection. When I put my money in a bank the money is insured. Crypto is simply too risky as a way of storing money and trading.
People actually realize that an anonymous, autonomous & decentralized system is not always desirable.
People actually realize that an anonymous, autonomous & decentralized system is not always desirable.
I've been a crypto investor started in 2013. I narrowly avoided MtGox by withdrawing my Bitcoins from it right when the rumors about withdrawal issues started.
If you have the efficient frontier model in mind, then you should know you shouldn't put too much money into it because the volatility of it is insane. My small early bets in Bitcoin and Ethereum worked out because the volatility turned out to work in my favor. But if they did go to zero it wouldn't have mattered much anyway. There're still other non-crypto stuff (e.g. tech stocks, ETFs) I invest into.
There're known ways to make risky investments work in a portfolio in the finance world - or else VCs wouldn't exist, coz nobody would give money to a VC to begin with. It's also a fact that most in the general public don't know about it. As a result, many public investors would see a Bitcoin as the same as a share in Google or Facebook - something to put money in. While in fact the attitude you take for each of these should be very different.
This would actually quickly lead to questions like how to protect public investors. Sure when Bitcoin drops or a startup fails everyone would be angry and people's instinct is to ban it, or at least make it available only to sophisticated investors. But then when things go well people would complain that only the VCs and hedge funds have access to the best investment options. I think the solution to this all is really investor education (modern portfolio theory isn't super complicated math) and better transparency. The latter can be done with better regulations of exchanges and ICO issuers. But the former has a long way to go.
If you have the efficient frontier model in mind, then you should know you shouldn't put too much money into it because the volatility of it is insane. My small early bets in Bitcoin and Ethereum worked out because the volatility turned out to work in my favor. But if they did go to zero it wouldn't have mattered much anyway. There're still other non-crypto stuff (e.g. tech stocks, ETFs) I invest into.
There're known ways to make risky investments work in a portfolio in the finance world - or else VCs wouldn't exist, coz nobody would give money to a VC to begin with. It's also a fact that most in the general public don't know about it. As a result, many public investors would see a Bitcoin as the same as a share in Google or Facebook - something to put money in. While in fact the attitude you take for each of these should be very different.
This would actually quickly lead to questions like how to protect public investors. Sure when Bitcoin drops or a startup fails everyone would be angry and people's instinct is to ban it, or at least make it available only to sophisticated investors. But then when things go well people would complain that only the VCs and hedge funds have access to the best investment options. I think the solution to this all is really investor education (modern portfolio theory isn't super complicated math) and better transparency. The latter can be done with better regulations of exchanges and ICO issuers. But the former has a long way to go.
«If I pay with a credit card I have level of protection. When I put my money in a bank the money is insured. Crypto is simply too risky as a way of storing money and trading.»
As always, the reality is not as black and white as you present it. Credit cards and fiat money certainly have advantages but they also have many drawbacks. Just to name a few: credit card fraud eats into merchants' profits, international money transfers are slow and crippled with high fees, bank accounts or cash can be frozen or seized by authoritarian governments, hyperinflation destroys savings, etc.
There are use cases where crypto adequately solves some of these problems that neither credit cards nor fiat money can solve. And, yes, crypto comes with a different set of drawbacks but that doesn't mean crypto is "too risky" for anyone to do anything with it.
As always, the reality is not as black and white as you present it. Credit cards and fiat money certainly have advantages but they also have many drawbacks. Just to name a few: credit card fraud eats into merchants' profits, international money transfers are slow and crippled with high fees, bank accounts or cash can be frozen or seized by authoritarian governments, hyperinflation destroys savings, etc.
There are use cases where crypto adequately solves some of these problems that neither credit cards nor fiat money can solve. And, yes, crypto comes with a different set of drawbacks but that doesn't mean crypto is "too risky" for anyone to do anything with it.
Your assessment from investment side is sound.
Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy.
Bitcoin as a main-stream pioneer served its purpose well, and now the focus is actually to provide equal-quality infrastructure for crypto to become a meaningful candidate for future economy.
That prospect certainly does not warrant the hype and money currently in the area on a case-by-case basis. But any such large-scale changes have to have a phase of rampant lock-in of wealth from general public so the society as a whole commit to support the development of the technology for some minimal amount of time.
I actually no longer regret my negligence to bitcoin, which for anytime between 2009 and 2014 can help me make a fortune from complete financial freedom to a year of income, now I see the society have committed a good amount of resources; and a substantial fraction of people are aware of the concept. It's not the time for engineers to start work hard and build the actual infrastructure.
That hopefully can deliver the actual value!
Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy.
Bitcoin as a main-stream pioneer served its purpose well, and now the focus is actually to provide equal-quality infrastructure for crypto to become a meaningful candidate for future economy.
That prospect certainly does not warrant the hype and money currently in the area on a case-by-case basis. But any such large-scale changes have to have a phase of rampant lock-in of wealth from general public so the society as a whole commit to support the development of the technology for some minimal amount of time.
I actually no longer regret my negligence to bitcoin, which for anytime between 2009 and 2014 can help me make a fortune from complete financial freedom to a year of income, now I see the society have committed a good amount of resources; and a substantial fraction of people are aware of the concept. It's not the time for engineers to start work hard and build the actual infrastructure.
That hopefully can deliver the actual value!
"Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy."
What? It's over 50% of total crypto market cap. And a huge chunk of the altcoins are barely liquid.
What? It's over 50% of total crypto market cap. And a huge chunk of the altcoins are barely liquid.
A bit pedantic, but Bitcoin is a hair under 50%, unless you count Bitcoin Cash with it (about 4%)
I was looking for a chart of that actually, what is your source? My point was also, a big chunk of alts do not have a super liquid market, makes it hard to count them seriously in all aggregate market cap.
https://coinmarketcap.com/charts/#dominance-percentage
I do of course agree with your overall conclusion - Bitcoin is still the most dominant, it just doesn't have the majority of market cap (since late 2017)
I do of course agree with your overall conclusion - Bitcoin is still the most dominant, it just doesn't have the majority of market cap (since late 2017)
>Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy
Sure, if you're calculating market share using the metric "how many crypto coins exist?", which makes no sense.
Sure, if you're calculating market share using the metric "how many crypto coins exist?", which makes no sense.
No, just by the metric of market caps of fairly liquid coins (btc, bch, eth, sia, etc.). Bitcoin is the minority coin now.
Bitcoin has always been the largest coin, and in fact has increased it's dominance by ~20% this year.
Scroll to the botttom for the chart:
https://coinmarketcap.com/charts/
Scroll to the botttom for the chart:
https://coinmarketcap.com/charts/
BTC is, by a _vast_ margin, the largest liquid coin, representing a hair under 50% of the market. So... what are you talking about?
Under 50% is the definition of minority.
For example, California is now minority-white, in that “white” is the reported ethnicity of less than 50% of the population, despite being still the largest sub-population.
For example, California is now minority-white, in that “white” is the reported ethnicity of less than 50% of the population, despite being still the largest sub-population.
Yeah, well there's no other coin out there which even approaches BTC's share, so calling it a "minority coin" is a bit disingenuous. You make it sounds like there are bigger players out there, which there aren't, and the entire point of your initial comment was to downplay the importance of BTC.
>Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy
So really, a "rather small fraction"? c'mon.
>Although I'd like to point out that bitcoin is now a rather small fraction of the whole spectrum of crypto economy
So really, a "rather small fraction"? c'mon.
I completely agree with you, but that guy could now point out that BTC did go beyond 14k and it may do in the future. Making him "right". That being said, I've encountered what you describe as well and it's mildly disturbing
It definitely attracts 'wrong' kind of people, but that doesn't mean idea is bogus. It needs more legitimate uses.
When there’s volatility there’s “alpha” to be had. If it was a flat lined chart, then no one would gain or lose which means 0% yield for an investment (my math could be wrong /s ).
The question is if you’re sophisticated or lucky enough to ride the variance on an upward direction.
The question is if you’re sophisticated or lucky enough to ride the variance on an upward direction.
Which is why it's not a practical currency. If it's a speculative investment I have many other options.
Cool.
What does that have to do with the SEC postponing its decision on whether to approve VanEck's ETF backed by Bitcoin, specifically?
What does that have to do with the SEC postponing its decision on whether to approve VanEck's ETF backed by Bitcoin, specifically?
That some of the recent gains are part of that same hype train, and the slump in light of recent ETF denials/delays is part of the same usual cycle.
> specifically
Bitcoin was already at 7500 much lower than its peak days before the decision
I'm aware. What makes the parent comment particularly relevant to VanEck's ETF vs all other threads about Bitcoin?
It's relevant to both. Put another way, there's nothing special about the VanEck ETF; it's just another (and there will be many more) piece of news in Bitcoin that drives up, then drives down, the price. To your bigger, implicit point, that the comment doesn't belong because it's not completely relevant, if we assume that's the case, that's the nature of a forum. How many Apple conversations dare to have comments about how the MBP isn't for developers, etc, regardless of the original point?
You're comparing the parent comment to other irrelevant comments elsewhere, in implicit agreement with me.
This article is about a specific ETF. How many people upvoting the parent comment understand that, say, the Winklevoss ETF was set to 0.01 BTC per share, whereas VanEck set each share at 25 BTC (which is something special); let alone the implications of such a difference?
I think it's been established on HN that Bitcoin = bad, we don't need to regurgitate the point on every thread about it. I come here for nuanced discussion, if I wanted black and white thinking I'd be reading plebbit.
This article is about a specific ETF. How many people upvoting the parent comment understand that, say, the Winklevoss ETF was set to 0.01 BTC per share, whereas VanEck set each share at 25 BTC (which is something special); let alone the implications of such a difference?
I think it's been established on HN that Bitcoin = bad, we don't need to regurgitate the point on every thread about it. I come here for nuanced discussion, if I wanted black and white thinking I'd be reading plebbit.
Aside from the share size, none of the concerns brought up in rejecting the Winklevoss ETF have changed. How would the share size impact the SEC's decision in this regard?
A good point made on /r/bitcoin was that the SEC has access to the DOJ, even if through unofficial channels. The price manipulation inquiries have yet to be resolved. If the SEC gives the go ahead, and the DOJ inquiry results in negative price action, those who invested in the ETF, which likely includes institutional investors, take it square in the mouth after assuming all was safe due to the SEC action.
A good point made on /r/bitcoin was that the SEC has access to the DOJ, even if through unofficial channels. The price manipulation inquiries have yet to be resolved. If the SEC gives the go ahead, and the DOJ inquiry results in negative price action, those who invested in the ETF, which likely includes institutional investors, take it square in the mouth after assuming all was safe due to the SEC action.
>How would the share size impact the SEC's decision in this regard?
Critical to the SEC's decision is investor access to the products, so that less knowledgeable investors are protected from unsound investments.
A higher share price restricts access to wealthier investors, the type that meet the SEC’s requirements for accredited investors.
That is just one difference between this ETF and the Winklevoss one, you were unaware of it (and the implications) but still regarded VanEck as not "special," further highlighting how pointless generic "Bitcoin = bad" comments are on threads about specific topics.
Critical to the SEC's decision is investor access to the products, so that less knowledgeable investors are protected from unsound investments.
A higher share price restricts access to wealthier investors, the type that meet the SEC’s requirements for accredited investors.
That is just one difference between this ETF and the Winklevoss one, you were unaware of it (and the implications) but still regarded VanEck as not "special," further highlighting how pointless generic "Bitcoin = bad" comments are on threads about specific topics.
> You're comparing the parent comment to other irrelevant comments elsewhere, in implicit agreement with me.
No, I'm implicitly agreeing with the HN community: comments that are considered valuable are voted up, without any need for relevancy police.
No, I'm implicitly agreeing with the HN community: comments that are considered valuable are voted up, without any need for relevancy police.
>comments that are considered valuable are voted up
I don't believe you're naive enough to believe this is the whole truth.
If you are, take a look at this thread, where the parent comment (that you compared to other irrelevant comments) is the most upvoted.
I don't believe you're naive enough to believe this is the whole truth.
If you are, take a look at this thread, where the parent comment (that you compared to other irrelevant comments) is the most upvoted.
Difference between what's considered valuable and what is valuable. Most communities lean a certain way. To little surprise, this community is also pro-open source and against the current US administration. My point is that whether or not a comment belongs is a product of the voting system.
"If I pay with a credit card I have level of protection. When I put my money in a bank the money is insured."
Just out of curiosity, what makes you think that insured transactions to verified parties will not occur at some point? Credit cards have evolved substantially from the days of paper imprints themselves.
Just out of curiosity, what makes you think that insured transactions to verified parties will not occur at some point? Credit cards have evolved substantially from the days of paper imprints themselves.
What about the state of crypto right now leads you to believe they will _ever_ be a common form of currency?
> I used to ride on the crypto hype train. Made quite a bit of money from btc. However, it is too risky of an investment. Most people that push crypto sound like pyramid scheme people.
Yes, and it includes those that peddle professional services i.e. lawyers and accountants. Those are the people who add the veneer of legitimacy to this pyramid scheme. These are the people that need to get their hands slapped.
The really funny part is that the same firms would never touch penny stocks, pink sheets or sellers of unregistered securities because that's "dirty". Cryptocoins on the other hand, absolutely! They are all over it.
Yes, and it includes those that peddle professional services i.e. lawyers and accountants. Those are the people who add the veneer of legitimacy to this pyramid scheme. These are the people that need to get their hands slapped.
The really funny part is that the same firms would never touch penny stocks, pink sheets or sellers of unregistered securities because that's "dirty". Cryptocoins on the other hand, absolutely! They are all over it.
> I used to ride on the crypto hype train.
What crypto hype train? Most crypto, such as AES, RSA, Mersenne Twister and the SHA series of hashing algorithms were very carefully designed and vetted over a long period by professionals. There's not much hype there, just solid technology. That cryptocurrency thing seems to attract scam artists like moths to a flame, though.
> The point is many crypto businesses screwed people over
Like RSA making the backdoored Dual_EC_DRBG the default RNG in BSafe?
What crypto hype train? Most crypto, such as AES, RSA, Mersenne Twister and the SHA series of hashing algorithms were very carefully designed and vetted over a long period by professionals. There's not much hype there, just solid technology. That cryptocurrency thing seems to attract scam artists like moths to a flame, though.
> The point is many crypto businesses screwed people over
Like RSA making the backdoored Dual_EC_DRBG the default RNG in BSafe?
Time to just accept that "crypto" means cryptocurrencies and also cryptography, and interpret the context to understand which is being spoken. Here it is clearly cryptocurrencies. Moving on...
You're looking for the word: cryptography.
Neither cryptocurrencies nor cryptography are, by definition, the only crypto.
Neither cryptocurrencies nor cryptography are, by definition, the only crypto.
Are you being purposely obtuse?
Practical use of these things is always just around the corner. At the moment it seems to be too slow and expensive to use for transactions (as currency) and too volatile to use as a value store. Right now it's a fun gamble, and for transactions where using normal currency woule have a higher cost (i.e. you are buying something illegal).
What a wild ride. I bought Ethereum almost two years ago at 12 dollars a token on Coinbase and it's changed the financial trajectory of my family. I still have high hopes for cryptocurrencies, but I think this pullback is necessary to clear out the speculators and let the developers work on the core infrastructure of a lot of these tokens.
Did you turn it into real money or are you still speculating (now with the future of your family at stake)?
I turned it into "real"(fiat) money. I expect to be sitting on the sidelines for another 2ish years. We bought a Model X and took the remainder and invested it into a pretty strong (IMO) YC startup.
#ThisIsNotInvestingAdvice
#ThisIsNotInvestingAdvice
Investing in a single company (even YC) is just about as risky as investing in crypto.
Disclaimer: I own a portion of about 100 YC companies. And some crypto.
Disclaimer: I own a portion of about 100 YC companies. And some crypto.
It depends on what stage, but yeah it's risky.
Investing that large of a percentage of one's portfolio in any single company is extremely risky; even if it is a large, publicly traded giant like Microsoft or Amazon. In order for the investment to be successful, not only does the company have to do well, but their sector has to do well, their country's economy has to do well, and stocks as an asset class have to do well.
If you don't have hedges to insure against those risks, you are still essentially gambling with your principal. Even a Series A/B Ycombinator company probably has a double-digit percentage failure rate.
If you don't have hedges to insure against those risks, you are still essentially gambling with your principal. Even a Series A/B Ycombinator company probably has a double-digit percentage failure rate.
Well the company is not A/B and it's not a large percentage of my portfolio. All I said is that it's the remainder of the money from cashing out of crypto, you're making a bunch of assumptions beyond that.
Also I agree with everything you said.
Also I agree with everything you said.
Sorry - when you said it altered your financial trajectory I assumed that to mean it represented a majority of your net assets. I'm in the process of diversifying a very concentrated portfolio (a year ago >95% of my net worth was in Uber stock) and may have projected my own concerns onto your situation.
> and took the remainder and invested it into a pretty strong (IMO) YC startup
Congratulations on becoming an accredited investor.
Congratulations on becoming an accredited investor.
I'm one of the core developers for Nano[1] (formerly called RaiBlocks). It's one of only a handful of cryptocurrencies with an actual working product available today that does everything it claims to do: Instant transactions with zero fees on a green network that could be powered by a single wind turbine.
Despite what I see as it's massive potential for things like micro-transactions, global remittance, arbitrage across exchanges, a development platform for payments and functioning as an actual currency (i.e. a medium of exchange, what you send is exactly what the other person gets) -- the market does not reflect this reality at all right now. There are several projects that are objectively scams with higher market caps than Nano.
To me this reflects that the market is completely irrational right now. I knew as early as January that there was going to be a reckoning, but until some of these coins and tokens that are going nowhere are shaken out projects will just have to stand on their own merits and prove that they're valuable.
[1]: https://nano.org/en
Despite what I see as it's massive potential for things like micro-transactions, global remittance, arbitrage across exchanges, a development platform for payments and functioning as an actual currency (i.e. a medium of exchange, what you send is exactly what the other person gets) -- the market does not reflect this reality at all right now. There are several projects that are objectively scams with higher market caps than Nano.
To me this reflects that the market is completely irrational right now. I knew as early as January that there was going to be a reckoning, but until some of these coins and tokens that are going nowhere are shaken out projects will just have to stand on their own merits and prove that they're valuable.
[1]: https://nano.org/en
It's not working because it's impossible to use Nano as currency when it has so much volatility. Imagine sending your friends $10 and they only receive $9.
That’s actually not true. Even if the volatility were that extreme, you could easily mitigate it.
At this point you are just saying anything that comes to mind and is negative without putting in thought.
At this point you are just saying anything that comes to mind and is negative without putting in thought.
> Even if the volatility were that extreme, you could easily mitigate it.
How?
How?
I'm late for this reply, but it completely depends on your use case. If you're just a normal user using cryptocurrency daily and you're most interested in the stability of value you could trade everything you receive for a "stablecoin" as it's known within crypto circles. This would effectively "lock in" the value. This is most effective using e.g. Nano since you can perform this immediately without worrying about transaction fees.
If you're unaware of that concept as a user but a fiat "off-ramp" exists (a way to turn your Nano into your local currency) you can immediately "cash out" whenever you receive a transaction.
If you're dealing with micro-transactions or payments in general then we're beginning to wade into the territory of imaging a secondary "off-chain" system of accounting and many strategies likely apply.
If you're unaware of that concept as a user but a fiat "off-ramp" exists (a way to turn your Nano into your local currency) you can immediately "cash out" whenever you receive a transaction.
If you're dealing with micro-transactions or payments in general then we're beginning to wade into the territory of imaging a secondary "off-chain" system of accounting and many strategies likely apply.
Can you trade nano for a stable coin that is pegged to USD without an exchange?
It is actually true. Please post how one can easily mitigate extreme volatility. I'm all ears.
https://coinmarketcap.com/currencies/nano/
https://coinmarketcap.com/currencies/nano/
That might be a valid criticism against e.g. Bitcoin with a 30 minute confirmation time, but if you send your friend $10 worth of Nano they'll have $10 worth of Nano by the time they receive it, ignoring whatever they decide do with it.
That's assuming that they can immediately send it to an exchange. Maybe my friend is sleeping or at work. In the time it takes for him to proceed with the steps of transferring to an exchange and cashing out the price in USD may have gone down.
I've always had the opinion that Bitcoin's price was supported in part, by the Chinese using it to get around China's capital controls.
So possibly this crash, in addition to the SEC refusal to let a Bitcoin ETF trade, is also affected by the recent tariffs and the Yuan devaluation...?
So possibly this crash, in addition to the SEC refusal to let a Bitcoin ETF trade, is also affected by the recent tariffs and the Yuan devaluation...?
It looks like there were people waiting for a good quit spot, other than that crypto market doesn't seem to be hard hit since 8 months straight and still stays valuable.
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Take the resources being spent to get Bitcoin onto Wall Street, spend them to get Facebook Moms onto Bitcoin and suddenly the value rises. Salvageable currency, without that utility it suffers.
I believe in Bitcoin only.
The people that have been around for almost a decade have treated Bitcoin as a hedge against Fiat currency inflation. Similar to how people treat gold. I am one of these people that believe in the 21,000,000 solutions as something that is nuclear chemistry proof and rare.
Outside of that is a joke.
dApps unused, copypasting bitcoin (or various alt coins), then promoting it as a world changing idea. Various centralized currencies which defeat the entire purpose.
I imagine things like Tether will be the future allowing money to be moved cheaply. As I develop my own coin, I choose to tie it to a very popular investment rather than produce yet another silly 'rare' number.
CryptoCURRENCY needs to move things that are hard to move, cheaply. Crypto that stores and manages data seems like a foolish application due to the enormous expense, unreliable txn times, and unneeded verification.
The people that have been around for almost a decade have treated Bitcoin as a hedge against Fiat currency inflation. Similar to how people treat gold. I am one of these people that believe in the 21,000,000 solutions as something that is nuclear chemistry proof and rare.
Outside of that is a joke.
dApps unused, copypasting bitcoin (or various alt coins), then promoting it as a world changing idea. Various centralized currencies which defeat the entire purpose.
I imagine things like Tether will be the future allowing money to be moved cheaply. As I develop my own coin, I choose to tie it to a very popular investment rather than produce yet another silly 'rare' number.
CryptoCURRENCY needs to move things that are hard to move, cheaply. Crypto that stores and manages data seems like a foolish application due to the enormous expense, unreliable txn times, and unneeded verification.
Why would you use bitcoin as a hedge against inflation instead of some real asset that has persistent value? Land, gold, etc?
Land is good, but can be seized by a government. I know an Iraqi family that went from riches to rags due to this.
Gold is good, but as a chemical engineer, nuclear chemistry is a real threat.
I love ETFs, but I think the market is artificially inflated by the current trump bull run.
Bitcoin is used worldwide and can be kept on a cellphone or piece of paper.
Gold is good, but as a chemical engineer, nuclear chemistry is a real threat.
I love ETFs, but I think the market is artificially inflated by the current trump bull run.
Bitcoin is used worldwide and can be kept on a cellphone or piece of paper.
> Gold is good, but as a chemical engineer, nuclear chemistry is a real threat.
I never thought I'd run into someone who believes in crypto and practical alchemy at the same time.
I never thought I'd run into someone who believes in crypto and practical alchemy at the same time.
You still rely on your cellphone and network. If Bitcoin becomes common enough, governments will find ways to ban / infiltrate / manipulate the network. It has already come down to seizing your land and gold, why don't they seize your phone, wallet, cut the Internet, arrest anyone who trade with Bitcoin?
> Land is good, but can be seized by a government. I know an Iraqi family that went from riches to rags due to this.
If more Iraqis had had Bitcoin, they would probably have been fine. /s
If more Iraqis had had Bitcoin, they would probably have been fine. /s
> nuclear chemistry is a real threat.
But the "51% attack" isn't?
But the "51% attack" isn't?
As others have stated; Land and Gold can be confiscated; Thieves, Governments, Inflation. Its also hard to move.
Any lock can be broken; any safe cracked. I trust in AES with many iterations of SHA512 to protect my coins.
I feel you don't really understand the value that cryptocurrency is adding; It is by its nature very easy to move and cheaper to protect than Gold. Its the long bet against eventually everything will be eaten by the state; or by inflation.
I feel you don't really understand the value that cryptocurrency is adding; It is by its nature very easy to move and cheaper to protect than Gold. Its the long bet against eventually everything will be eaten by the state; or by inflation.
Stealing your btc is also really easy, as xkcd showed a long long time ago: https://xkcd.com/538/
Someone who is stealing your land can also steal your private keys/digital wallet.
Crypto gets stolen all the time and once it's gone you have no recourse. It also gets seized. And of course you can also just lose it which is realllly hard to do with land.
>Crypto gets stolen all the time and once it's gone you have no recourse.
Someone steals your wallet with USD, whats the difference?
People act all weird when the word Bitcoin comes up, but its really not that different from gold and USD. Well except it solves a few problems those have.
Cant things be both advantageous and disadvantageous?
Someone steals your wallet with USD, whats the difference?
People act all weird when the word Bitcoin comes up, but its really not that different from gold and USD. Well except it solves a few problems those have.
Cant things be both advantageous and disadvantageous?
> Someone steals your wallet with USD, whats the difference?
I don't store the majority of my money in my wallet.
I don't store the majority of my money in my wallet.
> Someone steals your wallet with USD, whats the difference?
You lose a tiny amount of cash and get new cards from your bank. BTC is like carrying around your bank account, it's a whole different ball game.
You lose a tiny amount of cash and get new cards from your bank. BTC is like carrying around your bank account, it's a whole different ball game.
> Outside of that is a joke. ... copypasting bitcoin (or various alt coins), then promoting it as a world changing idea
> As I develop my own coin
How is your coin different from copy-and-pastes?
> As I develop my own coin
How is your coin different from copy-and-pastes?
'things like Tether' - There are basically two of them. Tether and MakerDAO.
MakerDAO has the advantage that it is designed so that you don't need to trust any human or organizational player. Just the crypto itself.
Tether can fall apart any minute. (e.g. when Tether executives play dirty)
MakerDAO has the advantage that it is designed so that you don't need to trust any human or organizational player. Just the crypto itself.
Tether can fall apart any minute. (e.g. when Tether executives play dirty)
MakerDAO can fall apart, too. From their white paper:
"If there is a sudden market crash in ETH, and a CDP ends up containing more debt than the value of its collateral, the Maker Platform automatically dilutes the PETH to recapitalize the system. This means that the proportional claim of each PETH goes down."
There's a lot of obfuscation about both that and Tether, but the reality is that a big drop in the asset held for stabilization will break the stability. And the asset is some cryptocurrency, not gold or land or something with a track record. Tether at least claims they have dollars, but their auditors are not convinced.
"If there is a sudden market crash in ETH, and a CDP ends up containing more debt than the value of its collateral, the Maker Platform automatically dilutes the PETH to recapitalize the system. This means that the proportional claim of each PETH goes down."
There's a lot of obfuscation about both that and Tether, but the reality is that a big drop in the asset held for stabilization will break the stability. And the asset is some cryptocurrency, not gold or land or something with a track record. Tether at least claims they have dollars, but their auditors are not convinced.
Spoken differently to see the glass half full: Ethereum Classic jumped to new hights, the highest of the last 4 month, while Bitcoin returned to the 6.something it was at the last month before passing 7k due to ETF rumors
Business as usual, some people make money (those who bought ETC 2 or 3 weeks ago at the dip, and are selling now in BTC or in USD), some people lose money (those who speculated on the ETF success). These are cold hard facts - not the half full, or half empty glass.
The article title however is just dramatization, maybe for clickbait, or maybe intended to please an audience of people mostly hostile to crypto? It is bloomberg that hits a new low.
Business as usual, some people make money (those who bought ETC 2 or 3 weeks ago at the dip, and are selling now in BTC or in USD), some people lose money (those who speculated on the ETF success). These are cold hard facts - not the half full, or half empty glass.
The article title however is just dramatization, maybe for clickbait, or maybe intended to please an audience of people mostly hostile to crypto? It is bloomberg that hits a new low.
At a party dude was telling everyone to invest in btc because it is the future, and it was $14k at the time. I explained that it is very risky and volatile and dude would just ignore whatever I was saying, even though I mined many cryptos, bought btc for 1 penny and had a better understanding of tech than him. 3-4 months later crypto was back to $6k and he never mentions it again with me around lol.
The point is many crypto businesses screwed people over (MtGox). Many people lost fortunes from private wallets due to malware, forgetting pw.
If I pay with a credit card I have level of protection. When I put my money in a bank the money is insured. Crypto is simply too risky as a way of storing money and trading.