Bitcoin

[Mighty Mouse]

I recommend reading articles by Keith Weiner, founder of Monetary Metals. He has a five article series about gold standards, why they failed, and how to move forward.

Is there a particular article you would recommend? I've heard him interviewed on several podcasts and listened to him debate Bitcoin vs. gold at the Soho forum, and I've found him as unconvincing (about Bitcoin) as any other gold bug. I wish him and his company well, but offering 3% on a $20k minimum account doesn't interest me and I don't think that's going to be enough to restore the monetary status of gold.

 

[Mighty Mouse]

How do you evaluate the risk of BTC going to zero in the next 10 years? What are the top 3 sources of risk, in your opinion?

I don't really care about the USD value of Bitcoin; I'm not trying to speculate on it hoping to make a quick buck. I hold it on principle because sound money is vitally important, and Bitcoin is our best hope of returning to sound money. But I'll play along anyway...

IMO the biggest risk to the USD value of Bitcoin is Uncle Sam attempting to quash it. They can't stop Bitcoin completely, but they could declare it illegal or impose an exorbitant tax, which would severely hurt its USD value. But they could also use my savings account to "bail in" my bank (as legally allowed under the Dodd-Frank Act), or declare gold ownership illegal (again), or decide to tax my unrealized stock gains (trial balloons recently afloat). The risk of a desperate government doing something stupid is common to assets of all types.

 

[MountainTracker]

If I were to put one at the top of risk it would be the individual holder. Keeping it safe is up to the holder. Btc are more often than not lost forever due to people forgetting their passwords, or being careless with how they handle it.

Sure a gov could ban it or tax it to high heaven. A holder can just pack up and move if they choose to. I don’t see an all out ban bc of game theory. I don’t see the US gov being ok with other countries holding btc and they themselves not holding it.


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[Stave]

Is there a particular article you would recommend?

One of his most unorthodox ideas is that the quantity theory of money is incorrect. He disagrees for example with Milton Friedman's maxim that "inflation is always and everywhere a monetary phenomenon." Here is an article about it. If you can answer this question: "what is the arbitrage mechanism that tethers the price of bitcoin to the price of commodities?" then I would be genuinely grateful and have a new to reason to ponder bitcoin's viability. You recommended a book about bitcoin earlier. Does it address arbitrage? Or some other theory about the mechanism that will eventually correlate bitcoin's price to commodity prices?

If you don't find that question interesting, you might peruse his essential articles Here

If I were to put one at the top of risk it would be the individual holder. Keeping it safe is up to the holder.

I second this 100% Humans are going to make mistakes and/or get scammed

Edit: here are the links that didn't post for some reason

Bitcoin, Gold, and the Quantity of Money | Monetary Metals

The popular view today is based on the linear Quantity Theory of Money. It seems to be common sense. If more units of a currency are issued, then logically...

monetary-metals.com

Economics and Gold Research | Monetary Metals

Monetary Metals' research incorporates our unique view of economics and the role of gold. Categories include Keith Weiner's monetary concepts, and other work.

monetary-metals.com

 

[IBen]

One of his most unorthodox ideas is that the quantity theory of money is incorrect. He disagrees for example with Milton Friedman's maxim that "inflation is always and everywhere a monetary phenomenon." Here is an article about it. If you can answer this question: "what is the arbitrage mechanism that tethers the price of bitcoin to the price of commodities?" then I would be genuinely grateful and have a new to reason to ponder bitcoin's viability. You recommended a book about bitcoin earlier. Does it address arbitrage? Or some other theory about the mechanism that will eventually correlate bitcoin's price to commodity prices?

If you don't find that question interesting, you might peruse his essential articles Here

I second this 100% Humans are going to make mistakes and/or get scammed

Edit: here are the links that didn't post for some reason

Bitcoin, Gold, and the Quantity of Money | Monetary Metals

The popular view today is based on the linear Quantity Theory of Money. It seems to be common sense. If more units of a currency are issued, then logically...

monetary-metals.com

Economics and Gold Research | Monetary Metals

Monetary Metals' research incorporates our unique view of economics and the role of gold. Categories include Keith Weiner's monetary concepts, and other work.

monetary-metals.com

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[Dos Perros]

I don't really care about the USD value of Bitcoin; I'm not trying to speculate on it hoping to make a quick buck. I hold it on principle because sound money is vitally important, and Bitcoin is our best hope of returning to sound money. But I'll play along anyway...

IMO the biggest risk to the USD value of Bitcoin is Uncle Sam attempting to quash it. They can't stop Bitcoin completely, but they could declare it illegal or impose an exorbitant tax, which would severely hurt its USD value. But they could also use my savings account to "bail in" my bank (as legally allowed under the Dodd-Frank Act), or declare gold ownership illegal (again), or decide to tax my unrealized stock gains (trial balloons recently afloat). The risk of a desperate government doing something stupid is common to assets of all types.

I didn’t specify any correlation of BTC to dollars. I meant to anything. What if no one can trade it, no one wants it? How do you quantify that risk? I suppose you could roll in the probability it goes to very near zero.

 

[Mighty Mouse]

What if no one can trade it, no one wants it? How do you quantify that risk? I suppose you could roll in the probability it goes to very near zero.

The same way I "quantify" any other risk: subjectively based on my (imperfect) knowledge of the past/present and my perception of future possibilities. There are no truly objective risk metrics; all are subjective predictions about the unknowable future. I think the risk that Bitcoin will "go to zero" or become untradeable or undesirable is low, and I act accordingly.

How would you quantify the risk of Bitcoin going to zero? Quantifying implies a numerical metric...what number would you assign to that risk?

 

[BRTreedogs]

Someone mentioned getting at least a little btc because of a limited supply.

What do you think is going to realistically happen to the people that don't have any if its adopted?

Think we're are all just gonna starve to death?

The government will just take yours and redistribute it. There not gonna let millions of people starve.

 

[MountainTracker]

Someone mentioned getting at least a little btc because of a limited supply.

What do you think is going to realistically happen to the people that don't have any if its adopted?

Think we're are all just gonna starve to death?

The government will just take yours and redistribute it. There not gonna let millions of people starve.

No I don’t think you are going to starve. There has and will always be levels of monetary wealth.

Idk how the gov would know whose wallets belongs to who, that’s why people have a cold wallets.

The chances of the gov taking fiat from banks is higher then taking btc from a cold wallet. For one reason it’s easier to do that. But they wouldn’t need to take it directly from peoples bank accounts, they’ll just print more. Which is the same as taking from a bank account.

Idk if you’ve seen the influx of people coming to America lately, they are not rich, they’re not starving so where does the money come from to support them? My accounts show the same number as yesterday, so it’s not coming from there. The money is coming from somewhere…I wonder where…if I could just put my finger on….the print button. Hahaha


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[BRTreedogs]

No I don’t think you are going to starve. There has and will always be levels of monetary wealth.

Idk how the gov would know whose wallets belongs to who, that’s why people have a cold wallets.

The chances of the gov taking fiat from banks is higher then taking btc from a cold wallet. For one reason it’s easier to do that. But they wouldn’t need to take it directly from peoples bank accounts, they’ll just print more. Which is the same as taking from a bank account.

Idk if you’ve seen the influx of people coming to America lately, they are not rich, they’re not starving so where does the money come from to support them? My accounts show the same number as yesterday, so it’s not coming from there. The money is coming from somewhere…I wonder where…if I could just put my finger on….the print button. Hahaha


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Wait until you pay taxes for the income you do report. Then you'll know where that money comes from.

The US isn't just going to let Btc be adopted and not have there hand in it.
I'm sorry politicians are just to greedy.

You may be able to see alot of gains buying and selling at times. But I think in the end they are just gonna tax the f out of it to redistribute the wealth.
Not saying you won't still be ahead on your investment.

But im much to pessimistic to think its just gonna be a grand adoption for btc holders.

 

[Historybuff]

At this point it's risky to NOT own bitcoin

 

[*zap*]

What inexpensive crypto has the best outlook for increases at this point in time?

 

[fmyth]

I don't sell anything unless I've held it a year. Then it's taxed as long term capital gains which is much less than I pay on my self employed income.

 

[MountainTracker]

Idk if anyone was tracking the action today but GBTC was up 11%. Maybe they are finished dumping.


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[Historybuff]

The UK is launching bitcoin etfs on the London stock exchange. Also Nilam Resources is a gold mining company. They are mining gold and buying 1.78 billion dollars worth of bitcoin. Selling gold for bitcoin. Very bullish news today. Don't worry it's not to late to buy bitcoin. 71k is still cheap.

 

[fmyth]

Looks like Nilam Resources issued a letter of intent to purchase bitcoin subject to raising the $. I'm not going to hold my breath.

 

[*zap*]

Selling gold for bitcoin.

My understanding is that they are issuing stock to cover the bitcoin purchase.

 

[MountainTracker]

My understanding is that they are issuing stock to cover the bitcoin purchase.

So they are pulling a page from the Michael Saylor MSTR playbook

I bet their stock pumps bc of the purchase.


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[*zap*]

looks like nilam resources is a penny stock that closed today under .02 cents and 5 year high was under .15 cents...if I am reading the chart correctly.

NILA. OTCMKTS

 

[Dos Perros]

The same way I "quantify" any other risk: subjectively based on my (imperfect) knowledge of the past/present and my perception of future possibilities. There are no truly objective risk metrics; all are subjective predictions about the unknowable future. I think the risk that Bitcoin will "go to zero" or become untradeable or undesirable is low, and I act accordingly.

How would you quantify the risk of Bitcoin going to zero? Quantifying implies a numerical metric...what number would you assign to that risk?

I think the risk is at least two orders of magnitude higher than what the market has priced in.

You absolutely can quantify risk. Hell that’s what risk managers in financial institutions do. Elsewhere as well.