Cryptocurrencies

[SharperDingaan]

18 hours ago, John Hjorth said:

How much of your capital has you long Bitcoin active [make it cyptocurrency]  allocated to this?

 

BTC is around 40% of our cash equivalent by market value, 25% by cost price; most of it bought over Q3, Q4, Q1, Q2 via systematic reinvestment of 25% of realised o/g gains. We subsequently reallocated an additional 25% of our cash equivalent into UBS when CS imploded. The BTC weighting looks different today, simply because the market value of BTC has risen faster than the rest of our cash equivalents; it would he higher still were UBS also not performing.

 

Ideally the rumoured US spot BTC-ETF funds get approved, BTC runs up quite a bit, and we sell/reallocate to treasuries to get BTC back to 15% or so. Add another 10% on a subsequent market wide sell-off, and we're back to a 25% weighting at cost 

 

Thereafter, 1/2 the cash equivalent gets liquidated and the funds repatriated and applied against outstanding mortgages.

 

SD  

Edited November 10, 2023 by SharperDingaan

[wachtwoord]

On 11/8/2023 at 12:16 AM, Castanza said:

You’re betting on the US system..BTC owners are betting on the global system. 
 

2-3% who comes up with those numbers? 

 

Indeed. In just H1 of 2020 it was 25%. Yes inflation is money supply increase, not some CPI BS.

 

On 11/8/2023 at 5:35 AM, rkbabang said:

That’s the reason I personally think Satashi was Hal Finney. He passed away in 2014. I can’t imagine anyone could have that much wealth and never touch it. Whoever he was he must be dead and his keys lost.

 

Nick Szabo most likely. No chance he wasn't involved imo.

 

On 11/9/2023 at 11:08 AM, gfp said:

Just to clarify - does everybody on this site that owns Bitcoin or other cryptocurrencies own them because they think they are going to go up in price?   (again, apparently we are all still keeping score in the USD unit of account, so yes I mean up in price against the USD).  I get that some of you are excited by the revolution but the reason you own it is that you think it is going to go up, right?

 

 

Store of wealth. It's very safe as a store of wealth cause you can still buy it for pennies (or fractions of that) on the dollar of today's value and it's only growing still. Only a large society changing event could upset that (very possible as the events of the last years have shown more and more).

Combine that with the fact you can actually access, store and move this yourself without 3rd parties (great when you need to flee) and it's clearly the best store of wealth for private individuals we have discovered.

 

21 hours ago, ValueArb said:

 

What "value"? Again, value has been traditionally defined by Graham/John Burr Williams is the future stream of payments that you are entitled to by owning an asset. Owning crypto doesn't entitle you to any future stream of payments, just the price as determined by the market.

 

Bitcoin has utility as a medium of exchange and pretty clearly that utility has increased over time. But utility doesn't fit within the value definition since it doesn't come with that stream of payments. So while it has inarguably become a better fiat replacement over time, that still doesn't give it characteristics of value. 

 

The utility IS the value. Not just for Bitcoin but for anything ever.

 

There's nothing else but utility that gives something value.

 

21 hours ago, rkbabang said:

 

 

Yeah, I didn't initially think ETH was a scam and bought a significant amount of it.  The planned conversion from PoW to PoS , and then actually going through with it, is what changed my mind.  It took me a while, but when I finally realized what PoS was designed to do, I completely changed my mind about ETH.

 

 

It was always a scam from the very beginning (pre-mine, rolling back transactions etc) it had to be because it's complex and complexity unavoidably leads to centralization. Centralization undermines the very nature of the concept of cryptocurrency. Without it you just have an inefficient database.

 

Only a handful of cryptocurrencies exist and only one is of serious size.

[rkbabang]

18 minutes ago, wachtwoord said:

 

Nick Szabo most likely. No chance he wasn't involved imo.

I

 

 

Nick Szabo is a good guess, and probably was involved, and IIRC he did invent some of the concepts used.  But I find it hard to believe that anyone alive has Satashi's private keys and hasn't touched the fortune.

 

Quote

 

It was always a scam from the very beginning (pre-mine, rolling back transactions etc) it had to be because it's complex and complexity unavoidably leads to centralization. Centralization undermines the very nature of the concept of cryptocurrency. Without it you just have an inefficient database.

Only a handful of cryptocurrencies exist and only one is of serious size.

 

 

Yes, I realize that now, but I was a little slow in getting it.  It took a deep dive into PoW vs PoS for it to click for me.  I did always realized that a Turing complete block chain couldn't be a currency or long term store of value, but I thought it could be a secure enough platform for smart contracts and things like DAOs.  Like I said I've changed my mind about all of that.  Any Turing complete system will never be secure enough even for those purposes even if it is PoW.  And no PoS system will ever be decentralized enough to be trusted.  So ETH is neither secure nor decentralized.   It took me a few years to come to this conclusion, which people such as yourself saw immediately, the pre-mine should have been the tell, but I eventually got it.  I still made a killing off of it, buying at $8 and selling a bunch at over $4000.   It is still a 6% position for me, but it is "free" as I got far more than my money back on what I sold already.  I will probably convert more to BTC next year.  I will have a high enough tax bill from the conversion I did earlier this year that I want to wait until the next calendar year to convert any more.

 

[wachtwoord]

58 minutes ago, rkbabang said:

 

 

Nick Szabo is a good guess, and probably was involved, and IIRC he did invent some of the concepts used.  But I find it hard to believe that anyone alive has Satashi's private keys and hasn't touched the fortune.

 

I do as using his stash will hurt Bitcoin a lot and even at this point could still threaten both its continued existance and integrity (attacks on its integrity are continuous, eg increasing the blocksize and POS). If I were him I wouldn't touch it at this point. Don't worry I'm sure he owns plenty not tracable to Satoshi.

 

I hope he's okay btw. His Twitter went silent early 2021 and was always quite active prior to that.

 

[Quote] I still made a killing off of it, buying at $8 and selling a bunch at over $4000.   [/quote]

 

I find this hilarious/ironic and it's one of the prime reasons why I never give investing advise. Even if I'm right I might advise someone out of the windfall of a lifetime or into the financial mistake of a lifetime.

 

Anyway the way you see it now is the same as me. Both the conclusion and the reasons for it.

 

Ps: how do you multiquote on this forum software to cut up a single quote as I attempted above?

[fareastwarriors]

 

11 minutes ago, wachtwoord said:

Ps: how do you multiquote on this forum software to cut up a single quote as I attempted above?

 

Highlight the section you want to quote, then Quote selection button come up. The quote pops into you reply box. Write your piece, then go back to the post, highlight another section, and Quote selection again. New quote will go  below what you wrote. 

 

12 minutes ago, wachtwoord said:

Anyway the way you see it now is the same as me. Both the conclusion and the reasons for it.

 

Easy.

[rkbabang]

5 minutes ago, wachtwoord said:

I find this hilarious/ironic and it's one of the prime reasons why I never give investing advise. Even if I'm right I might advise someone out of the windfall of a lifetime or into the financial mistake of a lifetime.

 

Anyway the way you see it now is the same as me. Both the conclusion and the reasons for it.

 

I know it is pretty funny that had I looked at ETH at first the way I do know I never would have bought it. Life is funny like that sometimes.
 

Quote

Ps: how do you multiquote on this forum software to cut up a single quote as I attempted above?

 

I cut the sentence out of the main quoted area.  Paste it into your message.  Highlight it then hit the quote symbol on the editor.  See picture.

[ValueArb]

4 hours ago, wachtwoord said:

The utility IS the value. Not just for Bitcoin but for anything ever.

 

There's nothing else but utility that gives something value.

 

Utility only provides an investor value if it translates into a stream of cash flows.  BTC's utility is the ability to do financial transactions without relying on government fiat, but the utility is the same whether BTC's price is $35,000 or $1,000. 

[alxcii]

1 hour ago, ValueArb said:

Utility only provides an investor value if it translates into a stream of cash flows.  BTC's utility is the ability to do financial transactions without relying on government fiat, but the utility is the same whether BTC's price is $35,000 or $1,000. 

 

Curious to know why you keep framing everything in terms of cash flows. A thing could be more valuable just simply because everybody else recognizes it has superior properties and wants to use it. A ton of gold 5000 years ago isn't worth anything, but transport it to today and it's a different story. The metal hasn't changed, the cash flows are still zero yet the "value" is completely different because we have collectively converged on this thing as money due to its properties.

 

5 hours ago, wachtwoord said:

The utility IS the value. Not just for Bitcoin but for anything ever.

 

There's nothing else but utility that gives something value.

 

How can you reconcile this statement with your view on ETH? You can do many things with ETH that you can't do with BTC, so how is it a complete scam? Yes, it's not as credibly neutral, but ETH isn't trying to be BTC - it just needs to be sufficiently decentralized and integrated enough into the crypto ecosystem for it to have value. An Amazon gift card is centralized but hey, I can still buy shit with it.

[Yosemite]

For those who are bitcoin bullish,  how do you respond to the quantum computing threat argument ?    While time disagreement exists for when the technology will be powerful enough, its coming.   Some smart subject matter experts put the timeline for quantum computers to be powerful enough as soon as 20 years in the future.    But even if you dismiss the hacking argument,  smart mathematicians can create an algorithm different (better?) with quantum computers.    Bitcoin at the end of the day is just complex crypto math. 

 

Gold survives as it cannot be faked (no fools gold), hacked or replaced (except maybe by Bitcoin).   Not to mention that it can not be easily used for ransomware payments. 

 

I have not read all 121 pages - so forgive me if it has been discussed. 

[ValueArb]

33 minutes ago, alxcii said:

 

Curious to know why you keep framing everything in terms of cash flows. A thing could be more valuable just simply because everybody else recognizes it has superior properties and wants to use it. A ton of gold 5000 years ago isn't worth anything, but transport it to today and it's a different story. The metal hasn't changed, the cash flows are still zero yet the "value" is completely different because we have collectively converged on this thing as money due to its properties.

 

Because I'm a value investor and that's how value investing defines the intrinsic value of an investment, the stream of cash flows it is likely to produce over time, discounted for time.

 

Everything else is a speculation because you are betting solely on price movements. Gold, commodities, and crypto are all different types of speculations, they all have different forms of utility but no cash flows.

[wachtwoord]

2 hours ago, ValueArb said:

 

Utility only provides an investor value if it translates into a stream of cash flows.  BTC's utility is the ability to do financial transactions without relying on government fiat, but the utility is the same whether BTC's price is $35,000 or $1,000. 

 

It always will. If not, it's not true utility. People spend wealth (in any form) on utility.

 

Finding underpriced utility is value investing. Undervalued cash flows that you mention is one of them. But so are undervalued assets on the balance sheet, which you'll likely also agree with.

 

You just don't seem to get that finding any underpriced utility is value investing.

 

Speculative would be if your profits come from (predicted) future increase of utility. So Bitcoin is can/be both: current utility is underpriced (value) and utility is likely to increase in the future (speculation/growth). The point is that the first one is sufficient and the second is gravy.

 

@rkbabang @fareastwarriors thanks it's easier when you enable desktop mode appearently as mobile mode hides many of the relevant buttons (I am on my phone)

Edited November 10, 2023 by wachtwoord

[rkbabang]

24 minutes ago, ValueArb said:

 

Because I'm a value investor and that's how value investing defines the intrinsic value of an investment, the stream of cash flows it is likely to produce over time, discounted for time.

 

Everything else is a speculation because you are betting solely on price movements. Gold, commodities, and crypto are all different types of speculations, they all have different forms of utility but no cash flows.

 

So you are a value investor and you will not make money any other way?   Many of us don't limit ourselves like that. I own SRUUF for example which is a physical uranium trust, because of a number of reasons I think there is going to be a major uranium supply shortage and the price will continue to go up.   Owning physical uranium isn't value investing, but why should that matter?  If you saw land or a house for sale and you knew a whole foods was going in down the street you wouldn't buy it to sell if for more in a year?   If you saw a baseball card at a yard sale that was drastically under priced you wouldn't buy it and put it on ebay?  Value investing is a great paradigm for making money investing in public companies, because it is repeatable (mostly). But there are other ways of making money too.   Most of the non-value-investing ways I've made money in my life have been one-offs and not repeatable.  Just like Uranium now (but especially a year ago) and the baseball card example, Bitcoin is like that.  It is a once in a lifetime thing.  You aren't going to be a "brand new store of value investor" and find a new type of store of value to invest in every year.  Sometimes in your life opportunities arise to make money and you either take them or you say, "no thanks I'm a value investor".  

 

[ValueArb]

50 minutes ago, rkbabang said:

 

So you are a value investor and you will not make money any other way?   Many of us don't limit ourselves like that. I own SRUUF for example which is a physical uranium trust, because of a number of reasons I think there is going to be a major uranium supply shortage and the price will continue to go up.   Owning physical uranium isn't value investing, but why should that matter?  If you saw land or a house for sale and you knew a whole foods was going in down the street you wouldn't buy it to sell if for more in a year?   If you saw a baseball card at a yard sale that was drastically under priced you wouldn't buy it and put it on ebay?  Value investing is a great paradigm for making money investing in public companies, because it is repeatable (mostly). But there are other ways of making money too.   Most of the non-value-investing ways I've made money in my life have been one-offs and not repeatable.  Just like Uranium now (but especially a year ago) and the baseball card example, Bitcoin is like that.  It is a once in a lifetime thing.  You aren't going to be a "brand new store of value investor" and find a new type of store of value to invest in every year.  Sometimes in your life opportunities arise to make money and you either take them or you say, "no thanks I'm a value investor".  

 

 

I try never to speculate, but that doesn't mean it's wrong for you to do it. But it is intellectually important to be able to know when you are investing and when you are speculating. 

 

In the case of Uranium you are speculating on a shortage. I would be wrong to say you shouldn't. Whether its a good gamble or not depends upon the quality of your reasoning and research, not that its a speculation.

 

If I saw a house for sale that would yield a good cap rate as a rental, i'd be more likely to invest in it if a Whole Foods was opening since it would give me more confidence rents will improve. But I wouldn't buy it unless it made sense on the cap rate it can yield now. I would never buy land as its locking up too much capital for potentially a long time without any yield, instead I'd try to buy an option on it;)

 

I'd certainly speculate on baseball cards and things like that at yard sales, but I wouldn't hold it long term and call it "investing". 

 

And hey, I understand the appeal of Bitcoin, I owned some at $400. But given my world view I could never make a lot on it because I feel compelled to assign a value to it and not hold it when it reaches value. So I have missed out on potentially massive speculative gains. But that's okay, because in full time investing I've never had a year where I didn't beat the market, and have averaged well over market returns. Making a 10-20% return on an investment can translate a lot higher if you can do it multiple times a year. I don't know how many ways there are to skin a cat but there are many ways to make money, and the best ones offer high returns for low risk.

 

[ValueArb]

1 hour ago, wachtwoord said:

 

It always will. If not, it's not true utility. People spend wealth (in any form) on utility.

 

Finding underpriced utility is value investing. Undervalued cash flows that you mention is one of them. But so are undervalued assets on the balance sheet, which you'll likely also agree with.

 

You just don't seem to get that finding any underpriced utility is value investing.

 

Speculative would be if your profits come from (predicted) future increase of utility. So Bitcoin is can/be both: current utility is underpriced (value) and utility is likely to increase in the future (speculation/growth). The point is that the first one is sufficient and the second is gravy.

 

@rkbabang @fareastwarriors thanks it's easier when you enable desktop mode appearently as mobile mode hides many of the relevant buttons (I am on my phone)

 

Assets on the balance sheet aren't utility, if they are tangible assets they are future cash flows. If something is "underpriced" it has an intrinsic value, and that value needs to be determined by future cash flows, discounted for time. 

 

Bitcoin has a great deal of utility for transactions. But that utility doesn't give the holder any call on any future cash flows and can't be valued. When I used to own Bitcoin I did try to value its utility by estimating how big the market for a non-fiat cross border currency was, and my estimate was that it was reasonable that the world maybe a couple hundred billion dollars worth. Unfortunately that seemed absurd when BTC had just hit a high of $450, and I couldn't bite the bullet on making a large commitment. So I missed out on selling a bunch of $450 BTC in the $5k-$10k range, oh well;)

[TwoCitiesCapital]

4 hours ago, ValueArb said:

 

Utility only provides an investor value if it translates into a stream of cash flows.  BTC's utility is the ability to do financial transactions without relying on government fiat, but the utility is the same whether BTC's price is $35,000 or $1,000. 

 

No, the utility expands exponentially via the growth of the network and the increasing places you can send/receive it along with a growing number of individuals holding it making it more scarce. 

 

The utility isn't what drives the value from 1k to 35k - it's the growth of the collective utility. Not unlike a social network.

[ValueArb]

6 minutes ago, TwoCitiesCapital said:

 

No, the utility expands exponentially via the growth of the network and the increasing places you can send/receive it along with a growing number of individuals holding it making it more scarce. 

 

The utility isn't what drives the value from 1k to 35k - it's the growth of the collective utility. Not unlike a social network.

 

Even if this is true, again greater utility doesn't translate directly into a higher value or price. Usage, network size (ie collective utility) can be just as large at $10,000 as $35,000.

[wachtwoord]

1 hour ago, ValueArb said:

 

Even if this is true, again greater utility doesn't translate directly into a higher value or price. Usage, network size (ie collective utility) can be just as large at $10,000 as $35,000.

Higher value yes, higher price no, not directly at least. If it wouldn't give any value it wouldn't be utility. Utility is worth something (of value) by very definition.

 

Considering your guesses for current value it's obvious you just get glued to whatever the market price seems to be at a time. When the price was in the tens you thought it was around that, same with the hundreds the thousands and now the tens of thousands. When it's in the hundred thousands you'll think that's the right range. This is exactly the psychology which explains why price gets stuck in ranges until is violently moves to a new range: price stickiness in the individual translates to price stickiness in the market.

[TwoCitiesCapital]

1 hour ago, ValueArb said:

 

Even if this is true, again greater utility doesn't translate directly into a higher value or price. Usage, network size (ie collective utility) can be just as large at $10,000 as $35,000.

 

I disagree. The higher the value, the more people will be using it and/or holding it. The more people holding it, the more people will need to pay to get a hold of it to use it. This the price. 

 

Just like anything - real estate, equities, art, etc. The more money flows into it, the higher the price gets to convince those already holding it to let go of some. More people using it = more money flows into BTC = higher price. 

 

The value is in the network. The network. The price will rise due to its scarcity and the increasing number of people/money flowing into it. 

Edited November 11, 2023 by TwoCitiesCapital

[jfan]

@ValueArb Thanks for elaborating on your experience wrt to your bitcoin transactions, and perspective. Initially, it seemed that your posts had an adversarial edge to them but your later posts were much more helpful understanding your point of view. I really do appreciate having a healthy genuine debate helps get to the truth of a matter. 

 

I thought I might include a couple quotes from Ben Graham about speculation and investing. 

 

According to Devil takes the Hindmost, Chancellor describes how pre-1920s, bonds were considered investments and stocks were speculative. When stocks became more accepted, the yardstick of valuation hinged on 10x earnings and expected dividend yields. Around mid-1920, Edgar Lawrence Smith published a statistical analysis of investment returns for stocks vs bonds from the mid-19th century onward dispelling the myth that stocks were not investment worth relative to bonds. This changed the feeling of market participants, allowing them to perceive that stocks could be viewed as investments. Around this time, the concept of discounting future earnings was the new way of valuing stocks. 

 

Ben Graham is quoted to have said: "the concept of future prospects, and particularly of continued growth in the future, invites the application of formulas out of higher mathematics to establish the present value of the favored issues. But the combination of precise formulas with highly imprecise assumptions can be used to establish, or rather to justify, practically any value one wishes, however high, for a really outstanding issue....The more important the good will or future earning-power factor the more uncertain becomes the true value of the enterprise and therefore the more speculative inherently the company stock...Mathematics is ordinarily considered as producing precise and dependable results: but in the stock market the more elaborate and abstruse the mathematics the more uncertain and speculative are the conclusions we draw from them."

 

From read these quotes, it seems that Graham thought that trying to estimate future cash flows was a risky and speculative endeavour. But in today's conventional understanding, valuation is all about discounted free cash flows and very little else. Perhaps it is better to utilize Graham's above definition of speculation as it seems there are many on this board that would disagree that commodities (precious and base metals), land and other assets with no immediately visible cash flows, can't have an intrinsic value. 

 

Perhaps I'll leave a couple other quotes to consider:

"Strong Opinions Weakly Held" - Paul Saffro

"The smartest people are constantly revising their understanding, reconsidering a problem they though they'd already solved." - Jeff Bezo

[jfan]

3 hours ago, ValueArb said:

Even if this is true, again greater utility doesn't translate directly into a higher value or price. Usage, network size (ie collective utility) can be just as large at $10,000 as $35,000.

I think this might be a very good point. There can be things that add alot of value but can't capture any of it. Just off the top of my head, businesses such as WhatsApp and Spotify, add value but can't capture it. 

 

Meta paid >$20 billion for WhatsApp in 2014 but it has not been successful thus far in generating revenue, free cash flows, etc. But with a 1.5 billion users, this messaging network is undoubtedly created lots of value but what is the right monetary premium?

 

The BTC network scales as people find it useful to store/transfer wealth relative to other monies that they have access too. Will this increasing demand necessarily the monetary premium? 

 

I'm not sure that there is necessarily a linear relationship here, as it will depend on the prices of commodity inputs necessary to secure the network and the progressive energy efficiencies of the technology. I could imagine that if there was a sudden abundance of cheap energy, silicon, and step change in mining efficiencies, despite increased demand, the prices could drop or moderate downward. 

 

 

[TwoCitiesCapital]

59 minutes ago, jfan said:

@ValueArb Thanks for elaborating on your experience wrt to your bitcoin transactions, and perspective. Initially, it seemed that your posts had an adversarial edge to them but your later posts were much more helpful understanding your point of view. I really do appreciate having a healthy genuine debate helps get to the truth of a matter. 

 

I thought I might include a couple quotes from Ben Graham about speculation and investing. 

 

According to Devil takes the Hindmost, Chancellor describes how pre-1920s, bonds were considered investments and stocks were speculative. When stocks became more accepted, the yardstick of valuation hinged on 10x earnings and expected dividend yields. Around mid-1920, Edgar Lawrence Smith published a statistical analysis of investment returns for stocks vs bonds from the mid-19th century onward dispelling the myth that stocks were not investment worth relative to bonds. This changed the feeling of market participants, allowing them to perceive that stocks could be viewed as investments. Around this time, the concept of discounting future earnings was the new way of valuing stocks. 

 

Ben Graham is quoted to have said: "the concept of future prospects, and particularly of continued growth in the future, invites the application of formulas out of higher mathematics to establish the present value of the favored issues. But the combination of precise formulas with highly imprecise assumptions can be used to establish, or rather to justify, practically any value one wishes, however high, for a really outstanding issue....The more important the good will or future earning-power factor the more uncertain becomes the true value of the enterprise and therefore the more speculative inherently the company stock...Mathematics is ordinarily considered as producing precise and dependable results: but in the stock market the more elaborate and abstruse the mathematics the more uncertain and speculative are the conclusions we draw from them."

 

From read these quotes, it seems that Graham thought that trying to estimate future cash flows was a risky and speculative endeavour. But in today's conventional understanding, valuation is all about discounted free cash flows and very little else. Perhaps it is better to utilize Graham's above definition of speculation as it seems there are many on this board that would disagree that commodities (precious and base metals), land and other assets with no immediately visible cash flows, can't have an intrinsic value. 

 

Perhaps I'll leave a couple other quotes to consider:

"Strong Opinions Weakly Held" - Paul Saffro

"The smartest people are constantly revising their understanding, reconsidering a problem they though they'd already solved." - Jeff Bezo

 

Excellent points on the evolving social mood of what is considered an "investment"

[Dave86ch]

On 11/9/2023 at 5:28 PM, ValueArb said:

 

 

I am referring to Lightning when I speak about payments. I run a node on Tor, completely anonymously, and I can buy coffee at McDonald's in my city with zero fees, instantaneously and anonymously.

[Dave86ch]

On 11/9/2023 at 5:54 PM, rkbabang said:

 

 

Your last 2 posts were excellent.  I think here you made a small mistake.  When Bitcoin finally stabilizes as the base-layer of wealth in society, it will increase not with population growth, but with productivity growth in the world's economy.   The more human wealth created, the more valuable each Sat will become regardless of population growth.  The inverse is also true, if human wealth is destroyed (a major war/asteroid strike/etc) the value of each Sat will decrease.  It will always be (human wealth)/(number of Sats in existence).  Since the denominator is mostly fixed (it can decrease if some are lost) the value of each Satoshi will mostly depend on numerator.

 

It will absorb the excess liquidity and deflationary forces, reintroducing a healthy market for investing, in contrast to the current state where speculation has become the only means to preserve wealth due to the Cantillon effect, which is undermining price discovery

[Dave86ch]

On 11/9/2023 at 6:51 PM, John Hjorth said:

How much of your capital has you long Bitcoin active [make it cyptocurrency]  allocated to this?

 

15%

[Dave86ch]

13 hours ago, ValueArb said:

 

Because I'm a value investor and that's how value investing defines the intrinsic value of an investment, the stream of cash flows it is likely to produce over time, discounted for time.

 

Everything else is a speculation because you are betting solely on price movements. Gold, commodities, and crypto are all different types of speculations, they all have different forms of utility but no cash flows.

 

Bitcoin is a technology, not a company. It generates value but not necessarily cash flow. Does the Internet lack value just because the protocol itself doesn't generate cash flow? Owning Bitcoin is akin to owning a piece of the base layer of an infrastructure that converts energy into scarcity, paving the way for a decentralized network of records. Growth in the network equates to growth in value.