Cryptocurrencies

[Fat Pitch]

BTC offers the most value to the criminal element? Are you ignorant of the fact that all transactions are forever logged on the public ledger for the world to see? The 21M cap is based on the client program parameters and any modification to it causes you to get forked off the global network.

 

Much is made of the 21M cap.

Problem is that BTC is not scarce, UNTIL that cap is eventually reached. The second problem is what does the cap include? Are the BTC in frozen wallets (lost the keys) included in that 21M?  - 'cause if they aren't, it's hard evidence that the cap can, and has been changed; upwards (ie: inflation).

 

The 'risk' also didn't go away, it just got swapped.

BTC offers the most value to the criminal element, and BTC security ultimately rests on their material presence. Russian and Chinese hackers are very good, but nobody hacks their patrons as it leads to a very short life ;) Hence asset class non-correlation, comes at the cost of criminal association. Not always a bad thing, if the alternative is reliance on a corrupt cental banker.

 

BTC is just another brand of soap; there are lots of competing brands (stores of value), and there always will be.

There will also be competing central banker token (CBDC), that is interest bearing.

5% capture of the existing gold allocation seens overly optimistic

 

SD

[SharperDingaan]

Guess what currency was used to transact for purchases

https://blockonomi.com/history-of-silk-road/

 

All that the world knows, is that a digital wallet has 'N' BTC in it.

The world does not know who's account that is, who paid into it, and who received any payments from it; just accounts.

ONLY two entities know the identities; the account holder, and the Oracle that issued the wallet keys. 

 

SD

 

BTC offers the most value to the criminal element? Are you ignorant of the fact that all transactions are forever logged on the public ledger for the world to see? The 21M cap is based on the client program parameters and any modification to it causes you to get forked off the global network.

 

Much is made of the 21M cap.

Problem is that BTC is not scarce, UNTIL that cap is eventually reached. The second problem is what does the cap include? Are the BTC in frozen wallets (lost the keys) included in that 21M?  - 'cause if they aren't, it's hard evidence that the cap can, and has been changed; upwards (ie: inflation).

 

The 'risk' also didn't go away, it just got swapped.

BTC offers the most value to the criminal element, and BTC security ultimately rests on their material presence. Russian and Chinese hackers are very good, but nobody hacks their patrons as it leads to a very short life ;) Hence asset class non-correlation, comes at the cost of criminal association. Not always a bad thing, if the alternative is reliance on a corrupt cental banker.

 

BTC is just another brand of soap; there are lots of competing brands (stores of value), and there always will be.

There will also be competing central banker token (CBDC), that is interest bearing.

5% capture of the existing gold allocation seens overly optimistic

 

SD

[wachtwoord]

BTC is just another brand of soap; there are lots of competing brands (stores of value), and there always will be.

 

That analogy only holds up if there would be only 1 brand of soap that actually cleans you.

[Fat Pitch]

Chain analysis software tracks the IP address that broadcasts the transactions and the fiat on-ramp points mostly KYCs all individuals entering the system. So yes the world does know who are behind most of these wallet addresses. Great thing is no transaction "disappears" like they do in the current banking system. Can't launder funds through BTC like you can with HSBC.

 

Guess what currency was used to transact for purchases

https://blockonomi.com/history-of-silk-road/

 

All that the world knows, is that a digital wallet has 'N' BTC in it.

The world does not know who's account that is, who paid into it, and who received any payments from it; just accounts.

ONLY two entities know the identities; the account holder, and the Oracle that issued the wallet keys. 

 

SD

 

BTC offers the most value to the criminal element? Are you ignorant of the fact that all transactions are forever logged on the public ledger for the world to see? The 21M cap is based on the client program parameters and any modification to it causes you to get forked off the global network.

 

Much is made of the 21M cap.

Problem is that BTC is not scarce, UNTIL that cap is eventually reached. The second problem is what does the cap include? Are the BTC in frozen wallets (lost the keys) included in that 21M?  - 'cause if they aren't, it's hard evidence that the cap can, and has been changed; upwards (ie: inflation).

 

The 'risk' also didn't go away, it just got swapped.

BTC offers the most value to the criminal element, and BTC security ultimately rests on their material presence. Russian and Chinese hackers are very good, but nobody hacks their patrons as it leads to a very short life ;) Hence asset class non-correlation, comes at the cost of criminal association. Not always a bad thing, if the alternative is reliance on a corrupt cental banker.

 

BTC is just another brand of soap; there are lots of competing brands (stores of value), and there always will be.

There will also be competing central banker token (CBDC), that is interest bearing.

5% capture of the existing gold allocation seens overly optimistic

 

SD

[rkbabang]

Chain analysis software tracks the IP address that broadcasts the transactions and the fiat on-ramp points mostly KYCs all individuals entering the system. So yes the world does know who are behind most of these wallet addresses. Great thing is no transaction "disappears" like they do in the current banking system. Can't launder funds through BTC like you can with HSBC.

 

IP addresses are very easy to hide/fake.  You can't track people by IP address.

 

EDIT:  That is poorly worded as you can track most people by IP address.  You can't track someone who doesn't want to be tracked by IP address.

 

[Fat Pitch]

With all the dragnets sniffing out IP addresses and VPN backdoors... yeah you are being tracked unless you use isolated hardware with Qubes/your own operating system. The pool of candidates with that level of opsec knowledge is very small so 99% are tracked.

 

Chain analysis software tracks the IP address that broadcasts the transactions and the fiat on-ramp points mostly KYCs all individuals entering the system. So yes the world does know who are behind most of these wallet addresses. Great thing is no transaction "disappears" like they do in the current banking system. Can't launder funds through BTC like you can with HSBC.

 

IP addresses are very easy to hide/fake.  You can't track people by IP address.

 

EDIT:  That is poorly worded as you can track most people by IP address.  You can't track someone who doesn't want to be tracked by IP address.

[Liberty]

https://www.cnbc.com/2019/03/22/majority-of-bitcoin-trading-is-a-hoax-new-study-finds.html

 

https://www.wsj.com/articles/most-bitcoin-trading-faked-by-unregulated-exchanges-study-finds-11553259600

[DRValue]

Mentioning Chainlink once more as Mainnet version 1.0 goes live May 30th.

 

 

This project is probably the most important in crypto.

[Fat Pitch]

https://www.fxstreet.com/cryptocurrencies/news/ethereum-20-research-breakthroughs-already-figured-out-says-vitalik-buterin-201905221520

 

This is a big statement by Vitalik, creator of Ethereum. Having followed all the research development for Ethereum 2.0 the past 18 months, I feel these nerds can actually pull off creating a scalable trustless settlement layer for the entire financial system stack and anything else that requires automated escrow.

[roughlyright]

Mentioning Chainlink once more as Mainnet version 1.0 goes live May 30th.

 

 

This project is probably the most important in crypto.

 

I already own lot of LINK. Very high quality project. What other tokens do you like?

[rkbabang]

"A Cryptocurrency Millionaire Wants to Build a Utopia in Nevada

A man spent millions on an enormous plot of land near Reno. Now he wants to build a community based on the blockchain technology"

https://www.nytimes.com/2018/11/01/technology/nevada-bitcoin-blockchain-society.html

[TwoCitiesCapital]

I joined the Bitcoin wagon.

 

Only 0.5% of my investible assets at this point, but would agree that I have misunderstood the opportunity for the past 6 years since following as far back as 2012/3013.

 

Could've been rich :(

[Liberty]

"A Cryptocurrency Millionaire Wants to Build a Utopia in Nevada

A man spent millions on an enormous plot of land near Reno. Now he wants to build a community based on the blockchain technology"

https://www.nytimes.com/2018/11/01/technology/nevada-bitcoin-blockchain-society.html

 

The track record of these things isn't very good, but I'm glad some people keep trying. Maybe someday someone will make something interesting that doesn't implode.

[Aberhound]

I joined the Bitcoin wagon.

 

Only 0.5% of my invest-able assets at this point, but would agree that I have misunderstood the opportunity for the past 6 years since following as far back as 2012/3013.

 

Could've been rich :(

 

Three developments:

 

1. Congress is told that Libra is critical to US dominance of the blockchain space which is a breakthrough technology

- crypto does not budge

 

2. Xi gives speech saying blockchain is a breakthrough technology and China must dominate

- Bitcoin rises 41% and shows who has more influence

 

3. yesterday ZeroHedge article points out the risks to bank deposits due to bail in and says there are $17T bank deposits in the US. Presumably similar in EU. What if 10% moves into crypto? If banks are no longer safe there will be sudden mass adoption in crypto. The result will be BTC $100K.

 

I find psychologically dollar cost averaging is the best way to deal with the volatility. I am comfortable with volatility if the trend is up long term with higher lows. Obviously you can buy more on lows but I find it is difficult to do.

 

Those that put 10% into crypto early will gain the most. The derivatives mean that many banks are already swimming naked. The models obviously will be shown useless when counterparties fail and sudden massive recapitalization will be required. The longer they are bailed out by QE the worse the pain will be because QE does not fix anything it only keeps zombies alive and erodes the economic structure by preventing capital from being allocated to better uses. It is the banks preventing the US from dominating the new system and the blockchain is a technological revolution waiting to be exploited. And yes it means the end of the current banking model.  The countries that get this first will suffer least. Suck it up and deal with the pain then move to the new system. Felix Somary's book from 1951 predicted this derivative problem and said that the desire of the bankers to make return without risk would destroy capitalism. If capitalism ends remember that it was the bankers greed that did it. I think Crypto is Satoshi Nakamoto's aka Alan Greenspan's attempt to save capitalism by preventing the collapse of trust caused the banks as Somary predicted by creating a system based on an NSA paper that creates trust by its inherent design. That is why it is a breakthrough. There are not many other people with the brains, wisdom and who are known to read everything and the position to implement this saviour.  If not Greenspan there could also be a Jack Ryan type character in US military intelligence.

 

Accordingly, buying crypto is how we all can contribute to saving capitalism. The other choice starts with a ruthless dictatorship and ends in atrocities like cannibalism. We all know it but do not like to think about it. As Thatcher says the problem with socialism is that eventually you run out of other people's money. Likewise all tyrannies in history have collapsed badly.

 

 

[John Hjorth]

... Only 0.5% of my invest-able assets at this point ...

 

... Accordingly, buying crypto is how we all can contribute to saving capitalism. The other choice starts with a ruthless dictatorship and ends in atrocities like cannibalism. We all know it but do not like to think about it. As Thatcher says the problem with socialism is that eventually you run out of other people's money. Likewise all tyrannies in history have collapsed badly.

 

Oh, please give me a break.

[SnarkyPuppy]

I joined the Bitcoin wagon.

 

Only 0.5% of my invest-able assets at this point, but would agree that I have misunderstood the opportunity for the past 6 years since following as far back as 2012/3013.

 

Could've been rich :(

 

Three developments:

 

1. Congress is told that Libra is critical to US dominance of the blockchain space which is a breakthrough technology

- crypto does not budge

 

2. Xi gives speech saying blockchain is a breakthrough technology and China must dominate

- Bitcoin rises 41% and shows who has more influence

 

3. yesterday ZeroHedge article points out the risks to bank deposits due to bail in and says there are $17T bank deposits in the US. Presumably similar in EU. What if 10% moves into crypto? If banks are no longer safe there will be sudden mass adoption in crypto. The result will be BTC $100K.

 

I find psychologically dollar cost averaging is the best way to deal with the volatility. I am comfortable with volatility if the trend is up long term with higher lows. Obviously you can buy more on lows but I find it is difficult to do.

 

Those that put 10% into crypto early will gain the most. The derivatives mean that many banks are already swimming naked. The models obviously will be shown useless when counterparties fail and sudden massive recapitalization will be required. The longer they are bailed out by QE the worse the pain will be because QE does not fix anything it only keeps zombies alive and erodes the economic structure by preventing capital from being allocated to better uses. It is the banks preventing the US from dominating the new system and the blockchain is a technological revolution waiting to be exploited. And yes it means the end of the current banking model.  The countries that get this first will suffer least. Suck it up and deal with the pain then move to the new system. Felix Somary's book from 1951 predicted this derivative problem and said that the desire of the bankers to make return without risk would destroy capitalism. If capitalism ends remember that it was the bankers greed that did it. I think Crypto is Satoshi Nakamoto's aka Alan Greenspan's attempt to save capitalism by preventing the collapse of trust caused the banks as Somary predicted by creating a system based on an NSA paper that creates trust by its inherent design. That is why it is a breakthrough. There are not many other people with the brains, wisdom and who are known to read everything and the position to implement this saviour.  If not Greenspan there could also be a Jack Ryan type character in US military intelligence.

 

Accordingly, buying crypto is how we all can contribute to saving capitalism. The other choice starts with a ruthless dictatorship and ends in atrocities like cannibalism. We all know it but do not like to think about it. As Thatcher says the problem with socialism is that eventually you run out of other people's money. Likewise all tyrannies in history have collapsed badly.

 

I'm long bitcoin.  You sound like a psychopath. 

[Gregmal]

I think its important to note that payment systems have and continually evolve in ways that are typically underestimated. Further, there is definitely a moving risk of government overreach. All the evidence you need to see is right there with how swiftly, and desperately they've moved to kill Facebook's Libra project. They hate this because they cant control it. At this point it seems unstoppable.

 

The big question to me is "why Bitcoin" vs any other crypto, and is being the first mover a valid answer to "why Bitcoin". Really, who knows?

 

I have a small % of personal money in BTC. I would in no way ever recommend this professionally or buy it with other people's money, but as a personal investment, I look at it as something as simple as "I can afford to" and just leave it at that. Its not a "portfolio move" and its not a trading strategy. I threw spare change on a monthly basis for like two years in my late twenties(several years ago now) at it and if I never see it again, I wouldn't even notice, and if it goes bananas, well thats what we play the game for and what investing is all about. 

[John Hjorth]

I think its important to note that payment systems have and continually evolve in ways that are typically underestimated. Further, there is definitely a moving risk of government overreach. All the evidence you need to see is right there with how swiftly, and desperately they've moved to kill Facebook's Libra project. They hate this because they cant control it. At this point it seems unstoppable.

 

The big question to me is "why Bitcoin" vs any other crypto, and is being the first mover a valid answer to "why Bitcoin". Really, who knows?

 

Great investment thesis, Greg. [And from here, please don't expect me to participate in this topic.]

[Gregmal]

I think its important to note that payment systems have and continually evolve in ways that are typically underestimated. Further, there is definitely a moving risk of government overreach. All the evidence you need to see is right there with how swiftly, and desperately they've moved to kill Facebook's Libra project. They hate this because they cant control it. At this point it seems unstoppable.

 

The big question to me is "why Bitcoin" vs any other crypto, and is being the first mover a valid answer to "why Bitcoin". Really, who knows?

 

Great investment thesis, Greg. [And from here, please don't expect me to participate in this topic.]

 

Agreed; one of the most compelling you'll ever hear!

 

Sometimes I prefer to live a little adventurously. Some folks find $20 in their jacket pocket(metaphorically) and think they need to protect it, nurture it, and carefully compound it(probably at mid single digit rates). I, sometimes just say what the ef, its not changing my life either way. After all, my BTC, whether now or in the future, will provide me more to show for my money than that vacation one took last year, or that fancy restaurant you went to last week, or the sports car you bought in your 40's to solve the mid life crisis...its all relative. I try not to take everything so seriously.

[John Hjorth]

Agreed; one of the most compelling you'll ever hear!

 

Sometimes I prefer to live a little adventurously. Some folks find $20 in their jacket pocket(metaphorically) and think they need to protect it, nurture it, and carefully compound it(probably at mid single digit rates). I, sometimes just say what the ef, its not changing my life either way. After all, my BTC, whether now or in the future, will provide me more to show for my money than that vacation one took last year, or that fancy restaurant you went to last week, or the sports car you bought in your 40's to solve the mid life crisis...its all relative. I try not to take everything so seriously.

 

OK, Greg. Each to their own way. Personally, I'm investing for the long term, where the underlying earnings and cash flow generates the future earnings and capital allocation opportunities.

[Gregmal]

Agreed; one of the most compelling you'll ever hear!

 

Sometimes I prefer to live a little adventurously. Some folks find $20 in their jacket pocket(metaphorically) and think they need to protect it, nurture it, and carefully compound it(probably at mid single digit rates). I, sometimes just say what the ef, its not changing my life either way. After all, my BTC, whether now or in the future, will provide me more to show for my money than that vacation one took last year, or that fancy restaurant you went to last week, or the sports car you bought in your 40's to solve the mid life crisis...its all relative. I try not to take everything so seriously.

 

OK, Greg. Each to their own way. Personally, I'm investing for the long term, where the underlying earnings and cash flow generates the future earnings and capital allocation opportunities.

 

So you're long TSLA? (kidding)

[John Hjorth]

Agreed; one of the most compelling you'll ever hear!

 

Sometimes I prefer to live a little adventurously. Some folks find $20 in their jacket pocket(metaphorically) and think they need to protect it, nurture it, and carefully compound it(probably at mid single digit rates). I, sometimes just say what the ef, its not changing my life either way. After all, my BTC, whether now or in the future, will provide me more to show for my money than that vacation one took last year, or that fancy restaurant you went to last week, or the sports car you bought in your 40's to solve the mid life crisis...its all relative. I try not to take everything so seriously.

 

OK, Greg. Each to their own way. Personally, I'm investing for the long term, where the underlying earnings and cash flow generates the future earnings and capital allocation opportunities.

 

So you're long TSLA? (kidding)

 

Greg,

 

What is it with you? -Please tell us something about what you're really up to .. - instead of all those [now hundreds of posts here on CoBF] about your <100 bps trades. - Please post your thoughts in the relevant investment ideas topics. -Personally, I don't see your posts there . [And please give me a break with regard to crypto.]

[Gregmal]

Agreed; one of the most compelling you'll ever hear!

 

Sometimes I prefer to live a little adventurously. Some folks find $20 in their jacket pocket(metaphorically) and think they need to protect it, nurture it, and carefully compound it(probably at mid single digit rates). I, sometimes just say what the ef, its not changing my life either way. After all, my BTC, whether now or in the future, will provide me more to show for my money than that vacation one took last year, or that fancy restaurant you went to last week, or the sports car you bought in your 40's to solve the mid life crisis...its all relative. I try not to take everything so seriously.

 

OK, Greg. Each to their own way. Personally, I'm investing for the long term, where the underlying earnings and cash flow generates the future earnings and capital allocation opportunities.

 

So you're long TSLA? (kidding)

 

Greg,

 

What is it with you? -Please tell us something about what you're really up to .. - instead of all those [now hundreds of posts here on CoBF] about your <100 bps trades. - Please post your thoughts in the relevant investment ideas topics. -Personally, I don't see your posts there . [And please give me a break with regard to crypto.]

 

I wasn't under the impression membership came with such obligations. Posting shares two primary purposes; engaging in thought provoking+pencil sharpening discussion regarding investment related content; and entertainment. Its a hobby that has tangential benefits with regard to understanding various market factors, including, what makes a market. I try to share with two things in mind, contribute to a community(as a member of any community should) and being transparent with what I am doing and why I am doing it(pretty much nobody in the financial industry is, and even less are on the internet). I delve into a third at times, which is debate(the purpose of which admittedly has little value).

 

I dont know whats wrong with 100 basis point positions. In fact, a quick glance at any responsibly managed portfolio would likely disclose the same. Here's a link to the hero's investment portfolio, of which 80% in sub 1%... https://www.dataroma.com/m/holdings.php?m=BRK

 

I have been pretty clear how I trade and allocate. That I have 60%+ in my top 5 ideas and trade with a portion of the portfolio as it is essentially free money and if managed appropriately probably entails less risk than good old buy and hold. That it has been proven, time and again that owning assets, of pretty much any variety(within certain frameworks) will do better than holding cash. That the stock market has a natural inclination to go up in time. That theres certain scenarios and market conditions where an idiot could make money, in which case its an almost certainty that a sophisticated investor with proper risk management techniques can as well. I can and have gotten into extensive analytical discussion and debate on various names and topics, but am under no obligation to. Given how little many else here contribute, why is the burden of weight all on me, John? Would you prefer if I just sit around and moonwalk my thesis drift on why BRK is currently a meddling investment? Or spend days and nights trying to convince myself and others that Prem is about to get hot now and that he's due? Nah...I like it better being on the right side of things, and if that means calling Buffets conflicts and hypocritical behavior for what it is, or seeing that Watsa has lost his way, so be it. If it means buying things that are currently working while others sit on both their hands and their huge piles of cash.. too chicken shit scared to even make a sub 100 basis point investment...so be it. I like making money. Not everything I buy is for everyone, thats fine. My BTC can sit there with my Gretzky OPC's... I'm good. Funny enough both have to date, and now spanning multiple if not many years, been noteworthy performers...which I understand, in value investor world, must be scorned, for it is part of the Bible for many a folk to look down ones nose if money is not made and lost within the framework of the Intelligent Investor....

[John Hjorth]

Thanks, Greg.

[Gregmal]

One final thought as I wind down a 12 hour day of reading earnings call transcripts and evaluating trade ideas for the upcoming week and pivot to sushi and a bottle of wine over TV with the wife(even though my mind likely still stays consumed with business and investing thought)...

 

Re: the "who knows comment"... this is the only honest answer there is. You will never find a multi bagger unless some, if not many of the questions relating to the idea are honestly answered with something to the extent of "who really knows" or "no one knows"... when "everybody knows", you get Treasuries and CDs.

 

On crypto and blockchain, I think it would be foolish for anyone, not to want to educate themselves on the subject. That does not mean or endorse investing in it, but simply making an effort to be open minded and understand it. There were a lot of people who wrote off a lot of disruptive ideas in their early stages. This may be one, it may not be, but personally, I find it inexcusable to potentially miss a major investment theme and possibly world changing shift, by being closed minded or pigheaded(or lazy). An investor should always at least seek to have background information on any subject, and try to answer the questions of who's making money, how are they making money, and why are they making money. And then not forget one can make money on multiple sides of the trade, not just one.

 

Food for thought.