Bitcoin on the rise

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Alphaville
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Re: Bitcoin on the rise

Post by Alphaville »

thanks for the links guys. this is even more complicated than i thought at first.

nevertheless, it could be traded on a purely technical basis.

do any of you have a broker that will let you set up stop orders for crypto trading? i expect slippage would be awful in a collapse of the market, but nevertheless... curious as to who offers it.

iopsi
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Re: Bitcoin on the rise

Post by iopsi »

white belt wrote:
Wed Feb 17, 2021 12:29 pm
@iopsi

I agree, tokenization is the way of the future and there will be massive structural changes as a result of it. My issue is, I'm not sure how to predict who will be the winners and the losers? We are in the early days of a space race between every cryptocurrency developer. Soon it will also involve every sovereign nation and central bank. Everyone is vying to be the next platform on which this tokenization will be built on top of. Hence why I say the crypto space is largely a speculative trade, with associated risks.
Yeah predicting which cryptos will be the winners is the hard part unfortunately.

Kinda like in the internet company days i guess (i didn't experience that tbf as i was too young but it's something i frequently see mentioned).

There is no obvious way to value them but i think a good place to start is stuff like:

https://blocktivity.info/

https://www.cryptomiso.com/

The first gives measures of activity and ratios of activity&markecap compared to bitcoin (so if a crypto has much more activity but much less marketcap, it is considered undervalued).

The second gives a github developer activity, which could be used as another measure of the potential/seriousness of a crypto.

Then there is just reading about the specific cryptos, the people & institutions behind them, perhaps their white papers too if one has enough technical knowledge, using them, etc.

The value of some projects might still not effectively be covered by these measures tho.
Some might have a greater moat than others (for example XMR for darknet market transactions).

Number of users and of d-apps could be other useful metrics.


Obviously none of this is a surefire way to pick the winners and make thousands % of return, but better than nothing....


Also i would add some amount of diversification between various mainstream coins and supposedly undervalued coins (based on the above metrics etc).

MinimalStructure
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Re: Bitcoin on the rise

Post by MinimalStructure »

I just learned about a bitcoin course on Saylor Academy. It's taught by someone heavily involved in Bitcoin and Austrian economics. I'm taking the course now. Is anyone interested in learning more about it and discussing bitcoin?

I'm less interested in the price and more interested in the anti-consumer incentives of money with value that tends to skyrocket every 4 years.

https://learn.saylor.org/course/PRDV151

giskard
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Re: Bitcoin on the rise

Post by giskard »

What a day. When is it going to stop moving? Saylor just sold a convertible bond at 0% interest rate to raise another billion dollars to buy bitcoin.

At what point has this thing reached escape velocity?

Alphaville
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Re: Bitcoin on the rise

Post by Alphaville »

insane!

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Jean
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Re: Bitcoin on the rise

Post by Jean »

I'm on the ravencoin train, this is crazy, I probably haven't bought enough to get rich out of it, but i'm learning about my feelings as an investor. Which are very akin to what i imagine gambling is for someone who believes he has some influence on his luck.

nomadscientist
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Re: Bitcoin on the rise

Post by nomadscientist »

iopsi wrote:
Wed Feb 17, 2021 2:26 pm
Yeah predicting which cryptos will be the winners is the hard part unfortunately.
If one is investing with some theory of value - admittedly not a popular strategy in the crypto world - rather than momentum trading, it is quite easy to predict that almost all of them are worthless.

Alphaville wrote:
Wed Feb 17, 2021 2:21 pm
nevertheless, it could be traded on a purely technical basis.
I have a feeling that this advice will not be understood. But as I have said in previous posts, you are several years too late. The hedge funds are already here.

Alphaville
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Re: Bitcoin on the rise

Post by Alphaville »

nomadscientist wrote:
Fri Feb 19, 2021 5:59 pm
But as I have said in previous posts,
which ones? i was just looking, but no luck :(

iopsi
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Re: Bitcoin on the rise

Post by iopsi »

nomadscientist wrote:
Fri Feb 19, 2021 5:59 pm
If one is investing with some theory of value - admittedly not a popular strategy in the crypto world - rather than momentum trading, it is quite easy to predict that almost all of them are worthless.
There hundreds of cryptos so yeah most of them will have no value/don't have any use.

However standard theories that define value as the discounted future cash flows of an asset are imo incomplete / self defeating in a sense.

Already with the internet companies we have seen that traditional valuation methods didn't work very well, as their true value (defined more broadly as the utility that something has in human society) couldn't be easily encapsulated in those metrics.

Cryptos are even harder to value with traditional metrics as most of them aren't even companies but a new asset class altogether.


But if i look at the market value of the things that their systems can replace (i.e currencies, equities, loans, store of value, tokenization of assets in general & free access to public markets, all kinds of decentralized apps, etc..) then it's clear they are MASSIVELY undervalued as an asset class.

Imo the top cryptos are probably a safe bet so at least with them one shouldn't go wrong.

But then again as with stocks it's better to diversify to decrease specific risk.

nomadscientist
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Re: Bitcoin on the rise

Post by nomadscientist »

It's possible to estimate saturated market capitalizations of currencies (e.g. $1tn or $10tn but not $100,000tn).

It's also possible to examine the technical features of these currencies and conclude that those with no substantial advantage over the first movers are unlikely to ever catch up with them.

Of course if what you mean by "predicting which cryptos will be the winners" you mean predicting what doge Musk's twitter will pump next Tuesday, there's little to work with.

iopsi
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Re: Bitcoin on the rise

Post by iopsi »

nomadscientist wrote:
Sat Feb 20, 2021 7:51 am
It's possible to estimate saturated market capitalizations of currencies (e.g. $1tn or $10tn but not $100,000tn).

It's also possible to examine the technical features of these currencies and conclude that those with no substantial advantage over the first movers are unlikely to ever catch up with them.

Of course if what you mean by "predicting which cryptos will be the winners" you mean predicting what doge Musk's twitter will pump next Tuesday, there's little to work with.
Yeah predicting Musk's tweets or WSBs memes isn't a feasible strategy.

It not what i meant when mentioning the difficulty of finding the winners ofc.

It was more about things like ETH vs ADA, or other cryptos that have the same function and are legitimate projects with current/future use cases and big potential.

In the mentioned case one has a prime mover advantage (ETH) while the other has a technology advantage.
So if one is confident that ADA's tech advantage will be enough to outcompete ETH (including the fact that the latter too is trying to upgrade to better algorithms like PoS), then it makes sense to put money into the former as the potential gains are 10x at minimum (not including the general additional influx of money into the crypto space).

So as i said while it's very likely that the crypto space will experience massive appreciation in general, it's a bit harder to pick which cryptos in particular will get all this cash.

bostonimproper
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Re: Bitcoin on the rise

Post by bostonimproper »

My 2c is that the size and growth of the developer ecosystem is probably the most important indicator of L1 success— as a means of transaction, not a store of value (BTC is probably going to be dominant winner which takes the “store of value” role). So I would (and do) put money toward growing projects like ETH (obviously), DOT, ADA, etc., weighted by market cap, whereas I find shrinking protocols like EOS are less interesting to put money toward.

Edit: Add some minor clarifications.
Last edited by bostonimproper on Tue Feb 23, 2021 11:34 pm, edited 1 time in total.

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Ego
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Re: Bitcoin on the rise

Post by Ego »

white belt wrote:
Wed Feb 17, 2021 12:19 pm
I think the current litigation unfolding with the 3rd largest cryptocurrency and "stable coin" Tether is essential to follow for anyone in the crypto space. Here's a surface level overview: https://www.msn.com/en-us/money/markets ... r-BB1dqUAK

It's quite possible that Tether has inflated BTC prices, especially if it comes to fruition that Tether isn't actually backed by reserves. This might ultimately end up as a catalyst for further regulation/government intervention in the crypto space.
This was (and still is to some extent) a concern of mine as well.


NY AG’s $850M Probe of Bitfinex, Tether Ends in an $18.5M Settlement
https://www.coindesk.com/ny-ags-850m-pr ... settlement

The NYAG’s office announced the settlement Tuesday, formally ending the inquiry that kicked off in April 2019. Under the terms of the settlement, Bitfinex and Tether will admit no wrongdoing, but will pay $18.5 million and provide quarterly reports describing the composition of Tether’s reserves for the next two years. More significantly, these reports will match information Tether already provided the NYAG about its reserves. The NYAG will bring no charges as part of the settlement.

giskard
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Re: Bitcoin on the rise

Post by giskard »

Ego wrote:
Tue Feb 23, 2021 9:00 am
This was (and still is to some extent) a concern of mine as well.


NY AG’s $850M Probe of Bitfinex, Tether Ends in an $18.5M Settlement
https://www.coindesk.com/ny-ags-850m-pr ... settlement

The NYAG’s office announced the settlement Tuesday, formally ending the inquiry that kicked off in April 2019. Under the terms of the settlement, Bitfinex and Tether will admit no wrongdoing, but will pay $18.5 million and provide quarterly reports describing the composition of Tether’s reserves for the next two years. More significantly, these reports will match information Tether already provided the NYAG about its reserves. The NYAG will bring no charges as part of the settlement.
It will be interesting if people interpret this as the matter being "put to bed" or if this will continue to be an issue. It certainly seems like some sketchy stuff was going on but it also seems like the reserves are going to be audited and reported going forward to some degree.

Def positive on net. I still wouldn't hold USDT when there are other stable coins like USDC out there.

white belt
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Re: Bitcoin on the rise

Post by white belt »

@Ego

Seems like a lot of legal jargon so I’m not really sure what to make of all of it. I guess we’ll just have to see what the audits look like?

Looks like BTC is in a downward trend. If it dips a lot lower I may consider allocating 2-3% of my net worth to it as a hedge in case the BTC maximalists end up being right over the long term. These things are hard to predict, but I was somewhat surprised the recent parabolic run didn’t draw more scrutiny from the government, so perhaps regulatory restrictions are further down the line than I previously thought.

white belt
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Re: Bitcoin on the rise

Post by white belt »

Clearly there are some gaps in my understanding of BTC price behavior. I thought rising long term interest rates would drive down BTC price, but it seems to be back up over $50k after dipping below for a few days.

Lucky C
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Re: Bitcoin on the rise

Post by Lucky C »

Don't think that you're missing some fundamental rule if you try to apply logic to mania, especially on a very noisy time scale of only a few days.

MegaRigger
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Re: Bitcoin on the rise

Post by MegaRigger »

white belt wrote:
Tue Feb 23, 2021 3:10 pm

Looks like BTC is in a downward trend. If it dips a lot lower I may consider allocating 2-3% of my net worth to it as a hedge in case the BTC maximalists end up being right over the long term.
Trying to time btc is extremely hard. If you want to get in I would suggest DCA spread over a year or more.

The altcoins are even harder to time. The high volatily of the last couple of days shows imho (but I'm far from an expert) that there is little support at current price levels. Everytime BTC drops a bit, alts drop harder. A month ago this was not the case. I don't think we will see a similar retrace as in 2018, but believe that the coins with stronger fundamentals (Solana, Cardano) will stand better (but still significant pullback, +50%).

Anyways it's still very risky business. A lot of the defi-protocols look more like elaborate ponzi-schemes that will collapse once the underlying assets (i.e. other cryptocurrencies) will loose significant value.

giskard
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Re: Bitcoin on the rise

Post by giskard »

MegaRigger wrote:
Fri Feb 26, 2021 7:58 am
Anyways it's still very risky business. A lot of the defi-protocols look more like elaborate ponzi-schemes that will collapse once the underlying assets (i.e. other cryptocurrencies) will loose significant value.
This is what scares me about DeFi now. We need a big crash to cleanse the space of all of the crappy projects and ponzi-schemes. I think ultimately the strongest exchanges (Uni, Sushi, etc) will survive (because it's pretty compelling to be able to do totally decentralized transactions, and their volume is already huge), but I think that the lending based tokens in particular could have incredible issues.

There are some experimental decentralized options and futures markets as well that are seeing big volume but I think they could come under huge pressure as well. Also some of the automated yield farming stuff based on recursively lending coins (yeah you read that right lol, I've been down these rabbit holes its totally nuts) is going to crash spectacularly.

white belt
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Re: Bitcoin on the rise

Post by white belt »

I dipped my toes in with an allocation of $1K today to BTC. I plan to eventually allocate $10K to serve the role of “digital gold.” I’m still not completely sold on BTC, but I think the upside is worth the risk as a portfolio hedge. I still allocate ~20% to gold, so it’s not like I’m choosing one over the other.

If Lyn Alden is right and BTC follows previous technical patterns (big if), we can expect the current bull market to push BTC to $100k+ before the next bear market (previous BTC bull markets shot to at least 5x before entering a multi-year bear market). These bull markets seem to have some correlation with the halving that happens every 4 years.

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