You are missing the point.
I disagree - and my first thought was to say that it's the opposite (i.e. you're the one missing the point) - but on further reflection, I have to say that given the extent of discussion on the subject over three years - you can't really be missing the point. Perhaps ignoring it would be more accurate.
If you look at bitcoin and
Women Empowering Women, you would say that there is no comparison.
But the comparison is a Get Rich Quick Scheme where the madness of crowds causes people to take leave of their normal rational senses. From reading your posts, you are clearly an intelligent articulate person. But once you are in the crowd of Bitcoin , you loses your reasoning powers. In many cases, this is accentuated by greed, although it doesn't seem to be in your case.
There are a few things we agree on so lets start there.
- Any new tech comes with a hype cycle (or multiple hype cycles) - and with that comes over-exuberance.
- There's money involved so there's greed involved. ( I won't claim to be immune from it - i'm not. It's part of the human condition - albeit that the speculative aspect of bitcoin/crypto was not what first grabbed my interest/attention - and that other aspect still has my interest as I see a lot of societal good coming from this shift over the fullness of time).
- That greed can shift things away from the reasonable to the irrational.
Where we disagree is that whilst that goes on, it doesn't mean that there isn't something tangible at the heart of bitcoin/decentralised crypto. The very same with your dot com boom n' bust analogy. All of those people were not wrong at all. In fact they were proven very much right (about the tech). Some of them got it very wrong from an investment perspective. Others didn't. In terms of $ outcome, there would have been extremes on both ends (unless of course the investment was correctly sized - which is something that I've advocated for here with regard to bitcoin/crypto).
As regards your latest analogy (that its an out and out scam) - that's neither accurate nor equitable.
As regards 'reasoning powers', that's exactly what I was doing in this instance. i.e. Quite rightly, when you previously (and in the post above) start claiming that bitcoin has no more value/utility than ridiculous things (tulips, your poetry, toenails, etc., etc.), there's a very simple test for that. You respect central banking, right? Well some of them have cited the very same characteristics of what makes for a decent store of value. When I ask you to compare these nonsensical things to bitcoin in that context, you've refused to do that. That doesn't make for a reasoned approach to this discussion and figuring this stuff out.
The reason you don't can only be that you know that the comparison is ridiculous.
You will look back at this at some stage in the future, and say
"How could I have been so stupid!?
Even if bitcoin fails, I don't believe that would be my thought process. I'm capable of reaching my own conclusions, assessing risk and making a decision accordingly. Maybe I'll get it wrong. But then, as I mentioned to you, if an investment is sized appropriate to the risk, what of it (bearing in mind that the risk is asymmetric)?
How come I didn't realise that when something has no intrinsic value that I didn't realise it was worthless?
Because bitcoin implicates a different paradigm based on trustlessness. I'm pretty sure I've explained the rationale behind that a million times already.
How come I didn't realise that there was something wrong when I couldn't explain why it was worth $100. Then I couldn't explain why it was worth $1,000. Then why I couldn't explain why it was worth $20,000.
Why is there no consistency in your claim here? Why do you impose a different set of rules to bitcoin than to gold? Why - in the course of that lengthy discussion - didn't you come clean and acknowledge that any difficulty that bitcoin faces in terms of valuation gold shares? To not do so
is disingenuous.
I've long since acknowledged that there is no neat formula for the valuation of cryptocurrencies as there is for equities. However, why single out bitcoin/crypto when you know well that gold presents with the exact same issue? That's in no way reasonable.
How come I bought into that nonsense that as they were making more, the supply was reducing?
You really do yourself a disservice with this in particular, Brendan. You can claim a lack of intrinsic value, we'll disagree but that's ok. Notwithstanding that, when the mining reward was cut in half earlier this year, that means a reduced supply. When the mining reward is cut in half once more in four years time, the supply of bitcoin will be cut once more. This isn't rocket science.
And I made a comparison between that bag of hot air and gold!
What on earth was I thinking?"
What I was thinking is that scarcity is a key characteristic of a good store of value. That's universally accepted - although you dispute it. And I'm not talking about that one characteristic - I'm talking about how bitcoin scores against those characteristics across the board. How you can claim that scarcity isn't relevant when the vast majority of sovereign currencies have been destroyed through rampant money printing ...I have no words for that.
And then in 20 years time, you will be posting on askaboutmoney warning people who are "investing" in the next bubble: "I got burnt badly by bitcoin.
Had I not sized my investment to a level I was comfortable with, that's a possibility. Given that I have - and given that my thesis on bitcoin is under constant review, I don't think that will be the case.
Your warning for the necessity of an abundance of caution I welcome. Where I vehemently take you to task though is this notion that bitcoin doesn't bring anything to the table. That's just plain wrong.
Lastly, I did 'cash out' of crypto in January 2018 when I felt the market was irrational. After that point - had I listened to the advice being given here by yourself and others - I would have suffered a far from immodest opportunity cost.
