OT: Ray, how's your Bitcoin investment going?

[unterhausen]

my son bought $100 worth of litecoin. He just told me he sold $100 worth, and still has $100 in litecoin. Pretty entertaining way to gamble. I tried to tell him just to leave it the whole amount in there, but I guess the money from 10 hours of teaching math to football players is worth something to him.

[nate2351]

Litecoin still has room to grow and the network supporting it can scale in ways Bitcoin can't which makes it more like "money". I think that's helping lead to its growth where Bitcoin has slowed. I play around trading with Litecoin and have had some great success with it.

Whether or not any crypto currency actually succeeds I think the technology behind it will be used more and more in the years to come, it's checks too many boxes not to.

[Tony T]

Originally Posted by unterhausen

my son bought $100 worth of litecoin. He just told me he sold $100 worth, and still has $100 in litecoin. Pretty entertaining way to gamble. I tried to tell him just to leave it the whole amount in there, but I guess the money from 10 hours of teaching math to football players is worth something to him.

He cashed in 50% of his chips and still has his original bet on the table.
Sounds like a smart kid to me.

[Tony T]

Call me skeptical, but anyone could see that this was not sustainable in 1637:



Look familiar?
(How could anyone look at this chart and put new money into bitcoin?)

[Tony T]

Coinbase is driving this bubble in bitcoin: One of the Biggest Bitcoin Exchanges Just Added 100,000 Users in a Single Day


Coinbase allows anyone with a credit card to buy/invest/gamble/flip bitcoin.
No credit checks needed to buy
Now with future contracts, there is a way to short bitcoin (which will drive up prices in the short run)

Sounds to me a lot like the 2000 internet bubble and the 2007 housing bubble.

[R3awak3n]

I just saw my $800 investment go to $1600 in a week. I have had xrp for a while though and should have bought some. Oh well. This is gambling but $800 is not enough that if I loose it I will loose much sleep about. Wake me up in 10 years.

[Tony T]

Originally Posted by R3awak3n

I just saw my $800 investment go to $1600 in a week.

I'll put a $25 chip on the table — lets see if I can also make a 100% return by next week

[nate2351]

Originally Posted by Tony T

Call me skeptical, but anyone could see that this was not sustainable in 1637:



Look familiar?
(How could anyone look at this chart and put new money into bitcoin?)

Not to rain on the parade but you could make the same argument for the Us economy as a whole. There is a lot of money floating around in the world right now and people are finding creative ways to spend it. Look at the growth of the NASDAQ.

[MattTuck]

As I said in my earlier post, I mostly agree that the running room left for bitcoin is somewhat limited.

Best case scenarios put your expected returns from bitcoin at 5-20x your money. Still a ridiculous return compared to traditional assets, but you're not going to become a millionaire by investing $1,000 like the people that got in early.

Even those 5x returns (from current levels) require you to believe some pretty big changes are taking place. Maybe another better solution (litecoin, ethereum, tezos, ripple, etc.) comes along and is better than bitcoin and you can get bigger returns from being in earlier... who knows.

Maybe it is tulipmania 2.0, or maybe it is dotcom bubble. Difference being that tulips were all hype and their value basically crashed to zero, dotcom bubble was a situation where valuations got way ahead of themselves, but directionally the market got it right. Essentially everyone uses the internet today. The technology is useful and valuable and has unlocked new functionality and allowed new business models and created huge amounts of wealth. People just got carried away in the beginning. In another 50 years, we'll still probably be using the internet and will be a bigger part of our lives than it is today. 50 years after the tulip bubble, I doubt that tulips had become such an integral part of society.

Maybe cryptos are Tulipmania redux and it will all end in zeros, or maybe it is following the arc of dotcoms... and in 15 years we'll have figured out how to deliver on the promise of this new technology, and all be using bitcoin and ethereum to send money to friends, and do escrow on real estate deals, and save a little as an inflation hedge.

[avalonracing]

Okay... you've convinced me. I'm investing in tulips.

[Tony T]

Originally Posted by nate2351

Not to rain on the parade but you could make the same argument for the Us economy as a whole. There is a lot of money floating around in the world right now and people are finding creative ways to spend it. Look at the growth of the NASDAQ.

I may be naive, and I won't research any further than Wikipedia, but:

In Europe, formal futures markets appeared in the Dutch Republic during the 17th century. Among the most notable centered on the tulip market, at the height of Tulipmania. At the peak of tulip mania, in February 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled craftsworker. Research is difficult because of the limited economic data from the 1630s—much of which come from biased and very speculative sources. Some modern economists have proposed rational explanations, rather than a speculative mania, for the rise and fall in prices. For example, other flowers, such as the hyacinth, also had high initial prices at the time of their introduction, which immediately fell. The high asset prices may also have been driven by expectations of a parliamentary decree that contracts could be voided for a small cost—thus lowering the risk to buyers.

[nate2351]

Just because the graph looks the same doesn't mean the outcome will be the same.

If we're going to compare bubbles the I'd argue Bitcoin is more like the dot com bubble. Like the dot com bubble it is built around an idea that has a lot of potential. Back then it was the internet and now it's the public blockchain. you could almost argue that, like the dot com, people are betting on the idea more than the product. Bitcoin has it's shortfalls and I could name five other cryptos that work better, but I think we are going to see blockchain technology being used in many applications in the future.

Remember when this was the public opinion of the internet? http://www.newsweek.com/clifford-sto...nirvana-185306

[MattTuck]

Originally Posted by nate2351

Just because the graph looks the same doesn't mean the outcome will be the same.

If we're going to compare bubbles the I'd argue Bitcoin is more like the dot com bubble. Like the dot com bubble it is built around an idea that has a lot of potential. Back then it was the internet and now it's the public blockchain. you could almost argue that, like the dot com, people are betting on the idea more than the product. Bitcoin has it's shortfalls and I could name five other cryptos that work better, but I think we are going to see blockchain technology being used in many applications in the future.

Remember when this was the public opinion of the internet? http://www.newsweek.com/clifford-sto...nirvana-185306

To be fair, if you invested (in the Nasdaq) at the peak of the dotcom frenzy, it took 15 years to make back your money, which is not an insignificant amount of time to be 'in the red'.

Still, I'd like to hear what the other 5 altcoins that are better than bitcoin.

[nate2351]

Originally Posted by MattTuck

To be fair, if you invested (in the Nasdaq) at the peak of the dotcom frenzy, it took 15 years to make back your money, which is not an insignificant amount of time to be 'in the red'.

Still, I'd like to hear what the other 5 altcoins that are better than bitcoin.

Point taken.

As for altcoins it depends on how you want to use them. Litecoin has great potential for peer-to-peer usage, Ethereum by default is the only thing you can use on Ethereum backed DApps, and Iota is fascinating for internet-of-things usage. There are others that are similar to those.
I think Bitcoin is stuck in old technology that will eventually catch up with it. It has the market cap and the name but trying to use it for anything other that storing value these days is too expensive and slow.

[54ny77]

Only Clarence Beeks knows where Bitcoin is headed.