Risking 50 % of your net worth is a very reasonable thing to bring up when you admittedly have a comparatively low income. You didn't listen or address the advice and arguments about trying to focus on getting your income higher.

Toothsayer (and others) is pretty provocative. If you want to get something out of this thread, use that as an opportunity to see things from another perspective, rather than being defensive.

Here's some real advice.

I think your best chance/highest EV here is in the possibility that you've bought in a fraction of the way up a short term bubble. What you've just done is classic bubble dynamics; people buying in for half their net worth at all time highs. You wont be the only one. If it goes up 2,3,4 times, I say put a stop on it, enjoy the money and (if you must play your long term thesis), wait for a much better entry. Double or triple $25K is a lot of money on your income.

I think you've got a 25% chance at least that you're buying partway through a bubble. So there's that. When the price starts getting truly insane, that's when you sell to the idiots. We're not there yet.

The best advice is probably not to slam down half your net worth based on an investment tip you got on an internet gambling message board.

"Today I took out a $325,239 equity loan on my house to purchase 191.118 bitcoin."

Cucks gonna cuck. What are you going to do?

It's not officially nearing the end of the bubble until people are making REAL posts like that one, and selling their children into slavery, to buy a make believe "coin" at all time highs.

This could crash hard any second. The higher it goes, the more likely the Chinese will decide to crack down, as a)they hate money not under their control and b) capital outflows from the Yuan are a huge concern for them...and they'll start noticing once it gets in the multi billions. 80% of Bitcoin volume is China. And that's just one risk.

Even if this crashes and goes back down to $800 or whatever, it will still far surpass the current price point in the future. Will happily wager it will be worth more on this date 2018 that it is right now.

BTC market cap is already multi billion.

https://coinmarketcap.com/currencies/bitcoin/

I am amused by some of the comments tho!

I'm really tempted to take that wager. For many years now, every 5 bagger off the previous lows that went exponential has sold down massively after it peaked somewhere between a 5 and 15 bagger and was much cheaper a year later. Unless you're playing a short term bubble run and intend to exit soon, it's just a horrible spot to buy Bitcoin here for the longer term.

This is a bubble, regardless of the long term prospects of bitcoin. My guess is we're maybe halfway through the bubble. Hard to say though, events dictate crash timing to some extent.

Disagree. Do you think it's horrible to buy google or apple for the longer term now?

My whole point is I think crypto will eventually be a over a trillion dollar market space.

Will it be btc, eth, tezos, other? I don't know. Am I some sort of savant that knows when something is at a short term peak or low? No. The space will grow, so I want to be in it.

Yes. People frequently think getting in 50% cheaper doesn't matter when the bull case is a 20 bagger, but they're completely wrong. When you add up all the EVs and odds, I think you'll find that that "doesn't matter" 50% is often the difference between winning and losing.

Look at the tech bubble. You'd just be getting breakeven after 15 years if you were dumb enough to buy at the highs. Your money would have been tied up, and you would have missed some incredible bargains and run opportunities in 2001 and 2009.

I mean, the bull case on the tech bubble is pretty straightforward and unassailable - stronger even than bitcoin - and that's the in the long term, tech is going to be future of nearly all the economy and all profits; therefore, you can't lose buying into tech and keeping buying new companies that come up.

That belief is how the 2000 tech bubble happened. It's not dissimilar to bitcoin. And unlike bitcoin, stocks actually generate profits, so they have a huge head start.
Nothing is certain, so I'm really curious what odds you would give "over a trillion market cap" for the crypto space. 80%? 90%? 50%?

What odds would you say your risk of substantial loss is if you bought now at $1700 and held for 5 years?

And what does "eventually" mean? Tech will also "eventually" be the majority of the global economy and nearly all of its profits. Yet it's taken a lot longer to get there than people thought. And if you bought in at the bubbles, you got your ass handed to you for 15 years of your life, missing out on other, higher EV, lower time frame, possibilities.
I think it's easier to predict short term bubbles and bases than it is to say whether bitcoin will succeed, whether the crypto space generally will succeed, and whether you can make meaningful money out of it even if you're right.

The last one is important. Even if *some* blockchain solution ends up being as large as say, the USD, how many duds will you have to buy and lose your money on, on the way? There are plenty of scenarios in which you're right about cryptos and make no money or lose money or miss out because you didn't buy everything or because there were so many things to buy that your 20 bagger got eaten up.

Toothsayer you bring up a lot of good points, but I think you're missing something fundamental here. I'll try to explain. Not sure how to use multi-quote, my bad.

Hearing you talk there's a few different things here.. are we talking about cryptocurrency? Bitcoin? Or blockchain? Yes, they're all connected, but the future for each is likely different, at least in my mind. BTW this post is way too long but instead of chopping it down, whatever I'll just click send and hopefully there's some value in it for anyone who reads the full thing.


<\\viewpoint>

Re: Bitcoin 1700+ 5 years from now?

IMO Bitcoin is f-ed as it stands. It's inherently flawed. In a marathon, yes it's first place right now because it had a huge head start, but in the end the market will react once they realize it's not actually any real solution and that's it. There is no true moat or lasting competitive advantage for Bitcoin. Even if they hard fork to Bitcoin unlimited (which they should) I still believe in the end it's done and that's because the developers/use case for Bitcoin is very limited compared to alternatives. It's rigid and inflexible and businesses won't/can't incorporate it in a way that adds tremendous shareholder value as they could with other blockchain solutions. For other real-world applications, just try to send some bitcoin right now and it's a joke; something on par with a Western Union in fees/time isn't a true solution. Even if they fork to BU, short term it'll likely go up even more because it solves some immediate issues for sure (I'd possibly be tempted to swing in for a few months before unloading) and alt coins (ethereum included) will likely be in for a lot of short-term pain.. but in the end (and this is the important part) it'll still be too little to late most likely and it just delayed the inevitable.

An awful non-technical analogy would be like: In the future, do you think people will be happy to whip out their phone and use cryptocurrency/blockchain technology in a way whose ceiling is like a 1998 Texas instrument calculator [where you can only do very specific/niche/rigid things] , or do you think there needs to be true value like with how people use smart phones now [where new stuff is popping up everyday and you can do so much more]? To me that's true value and I'm 100% betting on the latter. And Bitcoin will never fill that need so who cares whether it goes 1.7k ->5k -> 500. Speculating on the price a year, or 5 from now, is wasted energy in my mind unless you're a trader. The value proposition it holds just isn't strong enough to be "the one". (By the way, to anyone who is pro-bitcoin, that's cool. Not looking to argue, or change your mind, it's your money go for it! It really does not matter to me)

Re: Trillion market cap.

On no particular timeline, I'll bite and just for ego and put it at over 80%. If I didn't think it's a strong likelihood I wouldn't have the position I have now and luckily for me a lot of people don't feel as confident about it as I do because I would have had to pay a much difference price for my investments if that were the case. It goes without saying I believe the market is mispriced for the likelihood of this happening. So for my personal strategy, I have put a wager where if I'm wrong it sucks hardcore cause it's a lot of money, but I'm not ruined regardless. I see the decision tree in my head with the probabilities in my mind, took into my account how much I'm willing to risk on this uncertainty and bet it.

Re: Buying duds.

There will be so many coins that bubble and pop. I fully believe that. Ripple/Litecoin/Dash/Monero (Monero might have a tiny bit of potential but that's another story) will likely go May 10th Market value -> [who f-ing knows for real] -> pop. To invest in this space you need to understand a coins capability and what problems they're actually solving, which is what I think you're getting at. For different reasons in my eyes all of these will likely fail. To be analogous circa 1999, for me some of these are PETS.com. For Ethereum, it seems it could be a different story and as it stands, it seems most likely to be Amazon.com. As of May 2017 that's still an extremely hot take/highly speculative, but to continue that first analogy, it's by far the most likely to be 'that' smartphone of 2017+ and does not have that 1998 Texas instrument calculator ceiling. Look at the developers working on it, the Dapps coming out. Look at the EEA and some of the names already in it and likely to announce in the coming weeks. This is just scratching the surface, there's so much good stuff coming out these next 500 days and it's end-game capability will be that of Bitcoins and more. These are legit companies that are 'investing' in Ethereum, and by that I don't mean speculating by buying the coin, but looking to use this tech in their business - that's not just hype but real world usage. They're not doing that to be 'nice' or pick favourites in the crypto world, but because they see the value and the real-world application of what it can do. Are these all proven yet? No of course not, because if they were Eth would already be way higher. That's a huge part of the value of getting in before this is proven, because if/when this thesis gains mainstream acceptance the price will be a reflection of that fact. There is a possibility I'm completely wrong and this'll make great quote material a year onwards from now, but that's how I see it right now.

I can only speak for myself but I think that's what Housenuts could be getting at too. Arguing on metrics of price, where the bubble is, these are questions that don't matter as much when you reflect deeper and I'm not trying to hand-wave them away or have some fanboy tunnel vision. I understand EV with the best of them. It's just when you see the forest through the trees, buying Eth at $55 or $100 won't really matter objectively speaking, nor Bitcoin at $1700 or $1200. In laymen terms, you're likely to either make a bunch if it's the real deal, or you're going to lose a significant part of your investment. But if the former happens, and your viewpoint is similar to mine, it's so much more important to get in when you can as opposed to the 'perfect' time because the payoff is completely asymmetrical and who knows what tomorrow will bring..

Isn't buying at all time highs with a trailing stop a tried and true trend following strategy?

I don't see anything wrong with buying right now. But buying in is just one part of the thought process, you still need to:

1. size your position
2. figure out your exit strategy ahead of time

In the words of the GOAT, Soros:

shoving all in and clenching your ******* is not a well thought out plan

^ Good post Kazuya

But I don't like you bashing a 1998 TI Calculator Those things were the tits!! Think I spent $150 on a calculator during engineering school, I wonder what a similar one costs now

Probably about $150 plus inflation.

If you are still interested in this bet, PM me or post here to let me know.

I'd take the "lower than today" side of that bet too if the logistics are reasonable.

Could very well be a "bubble" but these types of posts have been popping up on Reddit for years. After the mtgox crash down to 200$ posts of people buying 70k$ worth of Bitcoin were happening.

You mentioned that you think the price didn't drop more during the last crash because Bitcoin is used for illigal activity. What % of the current price do you think is currently speculation?

If I'm not mistaken, volume isn't **** now that they charge fees. Of course volume was massive when it was ****ing free to trade. They should have had 99.99% of the volume throwing coins back and forth to themselves free of charge.

For the last time, Bitcoin doesn't need China. China has ****ing cracked down 80 ****ing times over the last 5 years. You get some panic sellers and then it just goes about it's business.

Who's to say they are even holding bitcoin. They may be shipping Yuan outside the country and having it converted into something else. You take that away and now you just have less transactions on the blockchain. There's plenty of other countries adopting bitcoin. The fear of China cracking down on it IMO is a moot point.

wasnt there some investor who said something like

"your pnl is determined by the price you paid for the asset"


buying crypto sucks right now. I havent bought a single bitcoin since 700s, and not ETH since $45.

buying sp500 absolutely sucks right now too. Those are the choices that are facing investors.



kazuya-

you have a fundamental misunderstanding of digital currencies.


Bitcoin (and for that matter, all digital currencies) arent a silver bullet or a shotgun pellet designed to solve all of the worlds problems or to be used/exchanged in a manner that is intuitive or seamless. The underlying technology today makes it impossible for crypto to be cheap, frictionless, reliable, secure, distributed or easy to understand all at once. You can only pick some of those things, and that's why there are so many digital currencies. Some have a hardcap and known inflation (bitcoin), others have an unknown inflation but may scale (ethereum).

It will likely turn out that you were never supposed to be able to use Bitcoin for coffee, and that ti89 calculator ability is exactly what gives it value. WHen Vitalik turns all wallets and transactions on Ethereum into smart contracts, only then may people come to realize that the vast majority of users interested in digital currencies only need ti89 capabilities.

Your argument is retrospective that tries to draw parallels from unassociated events in the past. Mine being introspective in that it is rooted in the present and what digital currencies are actually being used for today in 2017.

try this:

plot

avg weekly $ transaction volume
vs
market cap


and you will have your answer.

A great example of this is the automobile.

https://en.wikipedia.org/wiki/List_o..._United_States

.

You are such a loser.