Less backing means more risk is all, like how investing in the Central African franc is riskier than buying Euros.
I see crypto and more speculation than either investing or gambling. You are essentially betting that bitcoin’s value will raise against other currencies, particularly the dollar.
I would say that’s the sentiment for all speculative purchases though. Crypto or not. So that goes with anything that’s “overvalued” with the traditional pricing formula (Tesla, Netflix, Facebook, etc.). But that assumes the traditional pricing formulas are correct.
And options are literally by definition gambling, but I think many would still consider them investments.
I’d consider that speculation, a highly-leveraged gamble that you are smarter than other people. Potentially very lucrative if you are lucky. On average better returns than a scratchcard.
Personally I’ve learned that day-traders are stupid, but I am also stupid, so I refuse to dabble in gambles.
I think the argument is people will use Blockchain in the future. I agree that people will use Blockchain in the future. I don’t understand why that makes Bitcoin worth anything.
why is gold worth anything
It’s a store of value.
sounds like you answered your own question
Did I? Is Bitcoin a store of value?
that’s the hope (from some people)
1 Like
Gold has several thousand years of being shown to have “value” as people has generally desired to own it.
Bitcoin has less than 2 decades?
Maybe Bitcoin will be the new gold. I really don’t know. But at least to me bitcoin seems to have more in common with pyramid schemes than it does with gold. I guess time will tell.
Crypto isn’t a store of value. Theres only three types of people that own crypto. A very few people that own the bulk of it and who knows who they are or what they’re doing, some criminals, and a bunch of speculators who are puppets for the first group.
This is fascinating stuff here. FTX failed basically because they were acting as a bank and using their own coin’s value (FTT) as about 40% of their reserves. When that was leaked from an internal source the owner of Coinbase and a couple of other exchanges dumped all their FTT which took the value of FTT to basically $0. That took FTX’s reserves down to a point they couldn’t cover their internal trading activity.
I have some side opinions about the celebrity endorsing they touch briefly on in this article. That’s the pyramid scheme side of crypto & NFT’s.
Anyone else following this?
3 Likes
it’s certainly amazing that someone can make 13 billion that fast and lose it that fast as well.
lots of successful entrepreneurs never make north of 100 million.
1 Like
I wasn’t, but i just realized that that company based somewhere in the Caribbean that a friend works for is FTX, and I’m now catching up.
I was surprised last week when she sounded interested in a random new job. Now i know why.
1 Like
Wonder how many people have ever lost $13 billion? Probably only in the low double digits.
1 Like
They are based in the Bahamas for regulatory reasons. She mostly worked in NYC, and only occasionally had to visit “headquarters”.
You’re really going to have to twist arms to make someone travel from NYC to the Bahamas. Especially during the winter.
2 Likes
it’s so inconvenient to get there. hardly worth the effort…
(esp when staying in 5star accommodations)
1 Like