Bitcoin and other crypto - worthwhile or worthless?


Disclosure - I am long BTC but recovered all of my original investment after a big move up :slightly_smiling_face:

I read where Warren Buffet recently said he wouldn’t give $25 for all the bitcoin in the world. Personally, I don’t invest in stuff I don’t fully understand. Bitcoin doesn’t pass that test.

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I think that’s sage advice for ANY asset.

Many years ago I bought a small amount of Bitcoin but was required to sell it when I was living in Hawaii. I suspect Hawaii determined crypto was ‘illegal’ because at the time they had no way to tax income from it.

So April 11 I read that Hawaii was in the last year of a 3 year test of crypto,

I opened an account with Gemini, an exchange set up by the Winklevoss twins (Facebook developers) and bought two different cryptos and was given a small amount of Bitcoin. Total purchases were $200. After transfer fee I was at a portfolio value of about $195.

Flash forward almost a month and I am down to $117.59. A loss of about 41%. That is exactly why I didn’t buy a lot, because I KNOW it is not an investment. Sure, there are people who day trade in it and loan their coins for hopefully a profit, but not me. I have fared better in my casino excursions.

Crypto at the moment is not in great shape, perhaps because (my opinion) of world events and certain overseas billionaires taking their money out after their loss of their super yachts.

I am hopeful that I may be able to recover the money before December, because we may be precluded form owning it again. News last year appears to be that it is not illegal IF the company has applied for a money transmission license. I expect Gemini had because of the following statement: “Type of License: Gemini is a participant in the Hawaii Digital Currency Innovation Lab, a two-year pilot program, which terminates on December 31, 2022.”.

Then 7 days ago: HONOLULU (KHON2) — The bill that would have established a program for the licensure, regulation and oversight of digital currency companies in Hawaii was indefinitely deferred Friday afternoon.

It’s unfortunate news for the cryptocurrency companies participating in the Digital Currency Innovation Lab (DCIL), the state’s first pilot program that allows digital currency issuers to do business in Hawaii without having to first obtain a state money transmitter license.

So I wait to see what our legislature finally decides. I KNOW that they love to tax things as we have the highest tax rate in the country.

The problem with crypto is that it serves no real purpose other than to provide a means to pay for things that are illegal. And the anonymity feature is becoming questionable. The promise of crypto is that a greater fool will always pay more. Classic bubble mentality.

People (including me) have been saying that for 10 years. Every time the price drops, you hear more of it. Then the price goes back up even higher. If I’d put $100 in it the first time someone I heard someone say bitcoin was the next tulip craze, I’d be very wealthy now.

One benefit I see is that the government can’t print more bitcoin. So unless everyone just decides it’s worthless, there will still be a market for it. I don’t see everyone deciding crypto is a scam.

You could probably say that about anything. It was the secret to P.T. Barnum’s success and a fact well known by every carney barker that ever lived.

If it’s a bubble, it has been going on for a long time. Most bubbles are over in a couple of years. BTC seems to be a rolling series of bubbles! And financial firms are interested in it… like Fidelity Investments, they now have a wholly-owned company called Fidelity Digital Assets. Fidelity’s main strategist, Jurien Timmer, has written white papers and given talks about Bitcoin. Very interesting. I’m just glad I bought some and got my original money out, so if BTC $0 someday I didn’t lose anything. My aspiration is to sell at $100,000. It got up to $67,000. We shall see. I don’t have the guts to hold onto it until the later years on the chart below where it might be $387,391 according on Timmer’s more conservative model. It could very well be outlawed in a few years. The volatility is truly gut-wrenching. I’m sure many unfortunate people took out loans to buy BTC and have now lost everything. That’s not how you use it… you pay cash, throwaway cash mind you, and just a tiny bit. It’s like a lotto ticket; it’s entertainment.

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Bitcoin - bah…here’s MY retirement:

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If you tire of them, donate to a children’s hospital

Are you kidding??? That’s my kid’s inheritance.

Uh oh. Looks like some are missing their tags. You better go back to work!

Some crypto holders are now totally wiped out (Luna). The real issue is some people borrowed money to buy crypto and/or they owned too much. 1% of your portfolio to crypto is probably the maximum you should spend on it, and 0% on “alt coins”.