But my preferred broker, Interactive Brokers, doesnt allow shorting Bitcoin futures (the founder of IB seems very anti-bitcoin in general). Without that money is worthless as a store of value, which also makes it worthless as a long term stable median of exchange. 0 replies 0 retweets 3 likes. At least theyre cute and the grand kids like them! That is where we are with Bitcoins. There are other points that I cant think of right now. Do these 2 billion unbanned people 1) have internet access and 2) access to the initial bitcoin to get in on this internet money? Ah yes silly me :). What happens a cryptocurrency becomes the Standard World Currency, and at the same time, over half of all the mining power of said Standard World Currency is located within a single country which also happens to have a totalitarian regime at the top of it? Anyway, what would he dump it for? Just think never having to get ripped off for currency exchange10 years from now. You are a dumb man TomTX! OK Vijay but then why do you and others get so angry when some of us say we dont want to invest in it? No one controls it, so no one can rewrite the data. A currency that unstable cant be realistically used for transactions, even if you forget about its other limitations. Blockchain may be the future, but that doesnt mean any of the current currencies will be worth anything. Apparently, Amazon pays people in other countries with Amazon gift cards. The stock market over the long run will ALWAYS grow as long as the population and technology and our output as humans continues to grow. LennStar Its a complete rip off. Speculation is very useful and I dont think anyone is going off on peoples choice to speculate, but people are very bad at properly evaluating risk. Some guy on the internet January 3, 2018, 8:55 am. (Its also very hard to make jewelry out of. $100 per post is pretty motivating. However, governments and institutions are investigating the uses of some platforms, like Ethereum: https://globalnews.ca/news/3977745/ethereum-blockchain-canada-nrc/. Its not an investment. January 2, 2018, 7:03 pm. Evan Drake Cryptocurrencies are the key to humanitys survival. I can see scenarios where some of these platforms develop staying power and become increasingly valuable for the actual work that they are needed to accomplish. I advise you look at the 10-year PE ratio. While I dont consider Bitcoin an investment and I wouldnt advise anyone to pour their life-savings into it right now, I do encourage anyone reading this to buy a small amount and start using it to make everyday purchases. January 19, 2018, 6:45 pm. Tim Beck Well, imagine you are in 1963 and you hear the speech I have a dream from Martin Luther King on abolishing slavery and you ask the question Why do you think this will happen?. What is the US Dollar pegged to? Or physical goods if you want to use it to record land or vehicle deeds, etc. Its a win-win situation.. Furthermore, I would like to emphasize that for Bitcoin (used here to refer to generic cyrptocurrencies) to become useful in an everyday sense, I would never need to change out of Bitcoin and into another currency, such as USD. So for it to be a global currency taco bell is going to have to start paying kids in btc. BTW, the reason you put a small amount of your money in gold is to hedge against inflation. And verify. The amount of people who have posted on /r/personalfinance this year who sold crypto, then bought back in, and lost big, is astounding. If you think its a great investment, go ahead and buy some / a lot we are not stopping you. Read your history, it happens occasionally. Qaddafi was taken out because of the Dinar. Id like to address each. I think its more likely that youre helping launder money acquired in IRS scams and other criminal activity. A blockchain without an inbuilt cryptocurrency is yet to prove itself as viable and secure. Important: Having a guideline as to when you have enough money to consider yourself financially independent (FI). One book that I found very useful in understanding the greed-fear cycle (and Central Banking and the Federal Reserve system to boot) is the 2001 classic Towards Rational Exuberance by Mark Smith. Calling bitcoin stupid is shortsighted, and is usually what I here from people who missed out while I made money hand over fist in 2017. Priced in gold, they are still down more than 60%. Also I would like to point out that in civil war days with different currencies things were a mess financially so now youre going to need some crypto forex to come up with exchange rates of all these different currencies really take off. Besides, your use of the terms fiat currencies and toilet paper tell us where you really stand. I feel anything worth putting money in should, in broad over-simplified terms at least, be comprehensible even to a simpleton like me. Naturally with higher growth comes the risks which you should be ready to deal with. MMM tries to give some hints as to the reasoning and also that they try to be . Money only has value if it is stable and trusted. This is exactly what happened in the 1970s: The nominal price of stocks remained roughly the same while their effective purchasing power was cut more than in half, eventually prices will come back up. Holding gold is not an investment in this case, it is a hedge. Assuming you can know the exact price of a commodity on a given day is speculative, yes. January 4, 2018, 4:25 pm. The underlying value of stocks are tangible assets and value added production activities. Andy Stow The fact that Mr Money Mustache, one of THE most influential FIRE movement supporters, has made a post on itseeing how many financially illiterate people are out there is mind boggling. WantNotToWantNot In other words, if you truly need it to buy stuff, and thus you need to buy coins from some other person in order to conduct important bits of world commerce that you cant do any other way. So no surprise thats the first one, especially considering you need it to make the system work at all. how is this different than a crypto? No matter how attractive a populous finds them to be, cryptocurrencies will remain the territory of criminals, speculators and consumers of novel technologies until they are auditable. Satoshi, while extreme in his views, watched the housing market collapse due to the fraudulent behavior of the banks and the government that backs them. Iota and RaiBlocks use something different than the blockchain to make each user a miner by requiring each transaction to verify other transactions which prevents transaction fees. The sooner we debunk the myth and come to our senses, the richer our world will be. Youve made a great profit, and you can play with that $28k. More than triple the speed of Visa/MC. Shit. Incredible comment. Well I guess its all right then. Just one, just $2, and its (hopefully) only a sliver of your net worth. Let it get to 10 Trillion + in a couple or so years and then you come back talking about its stability! Agree, the valuation of these cryptocurrencies are out of whack. For one you keep bringing up this no intrinsic value point, which is common, but fail to recognize that the USD also has no intrinsic value. 3. Could you please tell us what you are invested in and when you got in? They could also plateau until earnings catchup with prices.. So I also read a lot about investment bubbles and fundamentals and how to tell those apart. Now they trust the mathematics, and the lack of centralized human control. Places like Singapore, Estonia, Switzerland appear to already working on converting their systems to digital cash. Its a constant struggle to find the right price. Jay Holden Banks and elites will remain even with Bitcoin, and if it goes your way it will probably the miningfarms and people who collect the most. I for one am lucky enough to participate in the birthing of an alternative financial paradigm so that people have choices. Stop Ironing Shirts You keep spouting off nonsense. I am not a millionaire either or have any heavy investments in any of this and I am not certainly looking to grow my investments by commenting on a blog, of all places! Guess what, we can automate all of those jobs with cryptocurrencies. Im interested to see how this plays out. Meanwhile, the honest, hard-working regular folks see their interest both plummet to nearly nothing, and they then see THAT minuscule interest TAXED AGAIN! Video compression tech. (And very badly compared to other cryptocurrencies.). but remember short positions have a possible infinite downside while buying the asset has a possible infinite up side, If you do this youre still speculating on a market that cant be understood right now. You are as usual missing the point and are behind trivia! South Koreans are NOT moving all their currency in to Bitcoins. Episode 496: Why Bitcoin is Stupid - Part 1 by Mr. Money Mustache. I read an interesting article regarding the price fluctuations, but I cant find it now. But at least 98% of MMM readers do not live in countries where this is an issue. Why do you think so? Do I still get the full bag or just a portion of your pinky fingers latest clipping? And you dont want it for this purpose anyway after all, do you currentlyhide your money in offshore tax havens and transact your business on black markets? But anyway.you need a little imagination to see the value it has for the first world, because it has to arise from something other than a replacement for something preexisting. They only speculate that others may want them in the future. You can buy puts in OSTK, MARA, GROW, OSTK and RIOT. Go educate yourself first. I own my currency as it is today (EUR and USD), how come you do not own yours? Dont you find it strange, though, that my grandfather used what you call toilet paper to buy his first car, and his first house? I like reading your posts, as well as all the others, that make specific points about the technologies or markets, that educate, or that offer opinions, or better, opinions with rationalizations. No. Great post, I have been content to sit on the sidelines and watch the show. Comparing bitcoin to tulip bulbs is intellectually lazy or deliberately misleading. Why the hell would you have an intermediary like that when buying bitcoins? January 2, 2018, 9:45 pm. You will not own your money more with virtual currencies. Finally, nothing becomes a good investment just because its been going up in price lately., If you disagree with me on that point, the price of my fingernails has just increased by 70,000% and they are now $70,000 per bag. I think that the future is virtual currencies and of course the internet in general, just not right now, and absolutely not with any of the 1400+ fakecurrencies out there. January 3, 2018, 1:43 pm, Apparently, Amazon pays people in other countries with Amazon gift cards. Blockchain is simply a nifty software invention (which is open-source and free for anyone to use), whereas bitcoin is just one well-known way to use it. But with 6-7 big mining players who dictate which fork of bitcoin to mine, the value of BTC or BCC or Segwit or whatever else comes, I have no faith in the value of BTC. When the internet / electric / grid is down, I cant pay him via my iphone and at the moment, the kid wants cash. While were on the topic of bubbles, it seems the truly gigantic bubble in the world isnt bitcoin, but rather the global debt market. Rick Gardner Although it is difficult to put a price tag on the speculation and mania portion of BTCs price, as sentiment strengthens in regards to Bitcoins future functionality prospects the price should continue to increase. Oh my gosh, get out! But if you have some play money, it doesnt hurt to speculate if that is what you enjoy doing and dont mind losing everything you put in. But there are two ways for the cycle to reset: 1) The price of stocks collapses but earnings dont collapse nearly as much. I do believe hyperbitcoinization will happen in a decade or two. January 4, 2018, 2:35 pm. And regarding Bitcoin as currency, it is already not usable as that TODAY. The people that buy into bitcoin will be hurting enough financially. It really starts to stink if it is left unattended to. Also, saying Blockchain Yes and Bitcoin No is tantamount to saying, Social Media is great but Facebook is not so great, or Internet Search is Great but Google is not Great!!! To compare with fiat currency, we need to consider fiat currencys rippling effect on society. His rhetoric about trusting the wise elites of the Federal Reserve also irks me. That means over the next 2 years, the Shiller P/E will be rolling out some of the terrible earnings numbers from the global financial crisis. If you do not know, We have prepared this article about details of Mr. Money Mustache's short biography-wiki, career, professional life, personal life, wife, girlfriend, dating, divorce, kids, today's net worth, age, height, weight, and more facts. Good points? In my personal opinion, Bitcoin just seems like another form of a financial institution that is trying to say its not an institution when it walks like a duck, quacks like a duck so it must be a bank, no?! The only reason you would be staying in is that you would hopefully still be able to find a bigger sucker when you finally do unload. Mr. Money Mustache shares his opinion about Bitcoin. Google, Amazon and Facebook came out of it. Do you know the state of US debt recently? Even the Bogleheads forum has not been immune. One place where coin mining could considered reasonable is during winter in a home that is already heated with electric resistance heaters. No. Bitcoins are scarce, your fingernails are not. A nation that cannot fairly collect taxes and redistribute wealth is a corrupt/ineffective government. The Vigilante Im not going to break the bank, but it sure is fun to be part of giving the world the choice to trust the network when the human institutions have failed. 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