Dealing with Greed

[SavingWithBabies]

@Hankaroundtheworld The issue with #1 is that it is still very much theoretical after quite a few years. I remember someone connected me with a person interested in doing a startup around real estate and a key part of it was blockchain technology. I bowed out because it sounded like buzzwords without concrete ideas. It didn't go anywhere. I think there are lot of companies/ideas like that but nothing real yet. Am I wrong or do you know of a company that has done it and is surviving on real income (as opposed running on VC money)? I would say if it is some kind of exchange/bank/holding company, that is too meta to count in my book.

[Hankaroundtheworld]

@SavingWithBabies : As I mentioned, the real Business Value Creation will take longer (speculation comes first), it is still a young technology. However, the Technology is proven to work, and innovation goes really fast now (with all the money flowing in). There is already enough written on the possible implementations for the real world, but the actual Transformation will take time. I have seen this also with Cloud business, Data Analytics, etc... . To call this is a scam by Bryan is really below the belt and unnecessary. The only discussion is "not if" but "when", and we can differ in the opinion on this.

Anyway, do whatever you want to do with this. I will stop this now, will report end of 2018, and we will see who's right.

[bryan]

I wasn't calling it a scam, Hank. My 11th post ever on ERE forums was about being a big fan of Bitcoin, saying that I used to:
> dollar cost average until it didn't make sense anymore, for my PF.

A lot of what I was excited about still hasn't even come close to happening and remains on the horizon! Hence it being more like the dot-com bubble. However, I see it as a worse bet now than it was in 2013 (though the economic situation is now better for it). Actually that last sentence indicates to me that I might still own too much Bitcoin... Greed indeed? Or just stupidity?

On the whole it's still worthwhile to have a small amount of crypto-currencies in your portfolio.

What I was saying, is that the way you are writing about it makes it sound like a scam. You seem to be mostly mentioning possible future gains and spreading FOMO sentiment.

Bitcoin (and related things) has been discussed before on the forums here. It's actually pretty cool/amusing to go look back to some of those old conversations:
@Emanuel for the first person to bring it up in 2010
Next mention is a dedicated topic in 2011 by @JohnnyH
then another in 2012 from @noskich
then 2013 by @ffj
etc

I wish I had found ERE forums earlier.. as it was love at first sight for me and Bitcoin. I would have been happy to know about it in 2010, 2011, or 2012. I might have been able to retire at 26 instead of 29 (assuming I wouldn't have lost my wallet, sold everything, or lost everything in a hacked/scam exchange, etc).

[Sclass]

My personal opinion, despite the risk of being part of a short-term bubble, you should not ignore this Crypto asset. Please study this thoroughly before you start investing. You will see that you will be part of a global transformation to decentralized business models.

Good luck and I wish you all the wisdom in this

I agree. I’m no fan of this thing. But I cannot help notice how persistent it is. As I said I’ve been watching from the sidelines for many years waiting for it to fizzle out like other ad hoc currencies I’ve seen created (Ithaca dollars from Cornell comes to mind). But bitcoin just kept recovering from this crisis and that to become even bigger. I barely had time after the multiple debacles at Mt. Gox to say “see I told you so” and the ecosystem had recovered and continued to grow.

This time it’s different. maybe. Sounds like you guys are having fun. No harm in putting a small portion of your net worth in something speculative. Money is money at the end of the day.

[Hankaroundtheworld]

Okay, my last comment on this before I report back end of 2018. Problem is that people are trying to understand Bitcoin (and sometimes they only know Bitcoin and have no clue about other innovations in this space) by looking at it using existing concepts (e.g. how fiat money works, or how the economy works, basically their reference point). It is very difficult to step out of your existing understanding of the world, and try to imagine how the world would look like by using different concepts. The same happened with Internet in the early 90's. At that time I was a Consultant in a IT company, and we had brainstorm sessions on what Internet could mean for the "real" world, and I am proud to say, we were almost 100% correct in our predictions, even though not many companies or people took it seriously. I think we are facing the same thing with this "Blockchain" invention. What it really means is that we can create "decentralized trusted networks of value" without the need for an intermediate organization or government. These type of networks solve the problem that we might not trust each other, but we can trust the network and what it holds (which is not only Internet money, but can be anything that holds value in the Digital Economy). This is a powerful concept and will change the world, no matter how many Bryan's will call it scammy just because I predict the gains from it. Bottomline I do not care if people call it scammy, nor did I care when back in early 90's people were giggling about potential Internet value. Of course, I was hoping that this forum would not lower itself to this type of reasoning, but it is what it is. For those people that want to grasp a bit of the enthusiasm that I felt, see the video : https://www.youtube.com/watch?v=oXdv7UzPokg

Once again, I wish you all the wisdom in this, and if you feel it is not for you or you like to stick to your old beliefs and concepts, then at least respect each other. One day we might need each other in one of the many decentralized trusted networks.

[jennypenny]

From noskich's thread "Bitcoins have gone up from around $2 in November last year to $15 now." I have no regrets though because even if I had loaded up on bitcoin at $15/share, I would have sold before it ever hit $10K/share. Then I'd regret selling when I did. Can't win that game and I'm glad I'm old enough to have learned that lesson.

I've been hoarding cash waiting for a market downturn to reinvest (still have substantial positions in treasuries and gold). As I listened to McAlvany's podcast this week, it occurred to me that I'm sleeping quite well watching the market and bitcoin from the bleachers. Maybe I won't bother jumping in next time. I think I'm still as greedy as everyone else here, but my focus has shifted. These days I want the same level of contentment, fitness, skill development, and self-actualization that I see in the most successful people.

@Hank -- My biggest concern is the energy usage. We're going to run up against some hard limits. I wonder about that with the conversion of everything to digital format, not just bitcoin.

[Hankaroundtheworld]

@Hank -- My biggest concern is the energy usage. We're going to run up against some hard limits. I wonder about that with the conversion of everything to digital format, not just bitcoin.

I couldn't resist to answer (as I respect you): You're right, if you only look at Bitcoin and how the Mining works, it costs a lot of energy. However, and I probably repeat myself, you need to read a lot about what is happening (beyond mainstream Media, they are behind and funded by the old power in this world). There are already solutions upcoming that will replace this "Proof of Work" type of mining, like "Proof of Stake" or variations of this. It might not be fully tested yet, but that is just a matter of time, innovation is going really fast now (almost impossible to follow it, but there are good presentations that summarize this). Once this is solved, including "transaction speed" and low cost of transaction, plus an easy way to create Logic in these decentralized networks (by Smart Contracts, or variations of this - also developing quickly), then you will see Business Value Creation going fast. That might still be 2-3 years further down the road, and a lot of speculation beforehand, but it will happen, I am 100% convinced about this, like I was 100% convinced about the Internet in the early 90's.

By the way, I forgot to say, there is a difference between "jumping in because of greed" versus "believing in a concept that might change the world and investing in it", or more generically the difference between "using information like sheep" or "understanding information and creation of knowledge". That last part is also belonging to self-actualization. I am not saying that greed does not play a role, we are all human, and to use Bitcoin as an example: if you only step into Bitcoin just because your neigbour is making money with it, then it is stupid and you set yourself up for failure. Try to stick to knowledge and get some profit from it (not only money)

[slowtraveler]

I have to thank the community for such an informing thread.

I was not expecting such a robust discussion to build so quickly.

As of now, I have decided to avoid cryptocurrencies for several reasons:
1) Extremely tedious and difficult to use, after multiple attempts to get wallets working, they did not. I can not imagine trusting my money to a system I can't even get started.

2) I understand my current investments better and they are far more stable, liquid, and likely to sell with a small bid/ask than cryptocurrencies when cashing out time comes.

3) I might have huge gains only to lose them to a wallet or exchange hack.

4) Seems a pain tax and banking wise. I've heard many stories of people's banks freezing for security reasons after buying cryptos.

[SavingWithBabies]

@ Hankaroundtheworld Well... You definitely won that one! And I learned a lesson about not hedging your bets! I'm not crying over spilt milk or anything like that though. But it is certainly interesting seeing how it played out so far.

edit: I think this ended up on my Notifications list but the post that triggered that got deleted. I had forgotten this thread. Just for context (I didn't go looking but rereading it was interesting).