Just gotta wait for it to hit bottom then buy on the dip.
Duh. Was gonna happen sometime.
Yes, you’ve got to plum the depths of memory all the way back to…April-May-June of 2021 when Bitcoin went from ~$63,000/coin to $32,700 in a span of 2 months to see something similar. ;)
I’ll believe doomsday forecasts for BTC when it falls below $15,000. Which may happen! But as a casual non-investor but watcher due to work-related stuff, I’m amused at the portents of doom regarding a cryptocurrency that has managed to be fairly resilient even when it’s taken major tumbles.
I don’t see it doomed, but what I do see is a lot of people who don’t know what they’re doing because they were gas-lit into throwing their money into a pit… are suddenly without funds at a time when they probably need it. I’ve seen a lot of posts via Reddit lately where someone has lost everything and they still can’t grasp what happened. It’s sad.
LeeAbe
2826
Most of them know exactly what they are doing. People treat it like a very volatile investment that they might get lucky with. Sure there are some people jumping in because they hear it’s the next big thing, but from all the investment stuff I follow, people who invest in it know exactly what it is and what they are doing.
call me when I can buy a reference to a bad cartoon of a disinterested monkey for $1
I think we are very much in the infancy of crypto investment – and I say that with 5 years of working with both Crypto “investor clubs” and also serious hedge fund and stock portfolio managers.
The biggest difference I see right now is the way crypto investors and hedge fund managers/serious stock traders think about assets.
Stock folks are pretty agnostic about assets. If they’ve bought a stock that they see becoming a dog, they’ll dump their holding and may even short it. They really don’t care very much about the assets themselves, in other words. They can go long or go short, depending on which way they see the asset performing. The only thing they care about is which direction the asset is going to move. They don’t really care about the asset itself.
But as far as I can tell, there’s still no really good way to short crypto (there are ways to do it, but it’s a far more involved set of transactions than, say, shorting a tech stock.) And crypto investors seem to find themselves inexorably evangelizing the asset they’re investing in. Which as any stock trader will tell you is a big no-no. And so crypto investors have this terrible blind spot where they always believe that holding their asset is the right play. In their minds, give it a few days and it’ll go back up, and it’ll be back on track next month. Or the month after.
At some point the technovelty will fully wear off and we’ll see if crypto as a highly volatile investment gets some serious traders involved with it. I suspect not, FWIW. I think it’ll remain a somewhat niche thrill ride for a good while.
Speaking of which, afaict Tesla bought their bitcoin at $31.7k and as of April still had $1.2B in holdings. So they are currently underwater on that bet that was supposed to be safer than storing it in a bank.
It’s not about it going to $0 but all the people who suddenly found out crypto as a “safer investment” in the past 2 years who are going to start losing money. All those crazy high APYs are going to start having issues, everyone taking out collateralized defi loans are going to having trouble. I know at least one person who quit their job because they had enough bitcoin tied up in staking and yield farming to gain enough interest to pay the bills, and with this hitting at the same time as a possible recession it becomes harder to get out of that hole.
Edit: As a comment I saw elsewhere, a lot of people who thought that since they understood merkle trees they could understand finance are going to realize how wrong they were.
Anyone who looked at a Bitcoin chart over the last year or 2 years or 3 years or 4 years and thought “That’s the safer investment” is a fool much deserving of being separated from his or her money.
I’m not sure I can think of a more volatile place to put money. It’s about as close as you can get to gambling as investing.
I mean the same can be said for a lot of the people new to the stock market in the last 2-3 years. A lot of people are puffing their chests about how much money they made and how knowledgeable it was. It’s easy (and common) to delude yourself that you are smart when you make money in a bull market, and crypto made that exponential.
LeeAbe
2832
I am tempted every time it comes down like this. Why not invest a couple thousand just to see where it goes? I don’t think Bitcoin is going away anytime soon, so that doesn’t worry me. What stops me is keeping it secure in the meantime. Using digital wallets I am not sure I can trust or keep secure, scares me off.
I don’t have the energy to load up Paint and badly edit the Simpsons’ “Fox News - Not Racist, but #1 with Racists” meme to read “Cryptocurrency - Not a Ponzi Scheme but #1 with Ponzi Schemers” so y’all are gonna just have to take it as read.
What could possibly be suspicious about a financial scheme that offers a 1% return … a day?
Scuzz
2835
I remember having tech stocks like Cisco and watching them rise and then split, a couple times. Then one day that kinda stuff stopped and prices settled down. Depending on when you bought and sold you may have done very well, or you got on to late.
The difference is those tech stocks were based on actual products and were still worth something at the end of the day.
JoshL
2836
I’ll put my prediction here. In 10 years bitcoin will be worth nothing, it will be a novelty, maybe it will be worth a few dollars.
The problem is that crypto currency as a whole can’t survive unless it finds a use case (other than people selling it to each other hoping to find a bigger fool). And if it does find a use case – and I’m not ruling that out – bitcoin will definitely not be the crypto currency that best fulfills that use case.
Because bitcoin is terrible at everything. It’s slow, it’s expensive, it’s ecologically disastrous. It’s just a terrible system.
Did you know, for example, that the bitcoin blockchain does not actually record how much bitcoin is in a given wallet? If you want to find out for sure how much bitcoin is in a wallet, you have to analyze every block from the beginning and total all the transactions going into or out of that wallet. It’s nuts.
There are already use-cases for an irreversible payment system/currency that bypasses traditional banking credit card fees. Some of the transactions within that umbrella are very legitimate (such as ticket reselling for sporting events, concerts, Broadway shows, etc.). Some are very much less legitimate (paid cloud storage file lockers for sharing copyrighted content, for instance).
Right now BTC and other cryptocurrencies get some usage to fill that void. That doesn’t mean that a more efficient payment currency couldn’t fill that role of an irreversible payment media for limited-time use goods/services better and more efficiently though!
LeeAbe
2838
As @triggercut pointed out (and I tried to explain months ago in this thread), that doesn’t matter to some people. If it might go up, people will put money into it. Stocks sometimes don’t behave as they should as well. Look at GME or even TSLA. People invest in them not because there is a successful business behind them but because they think the sentiment towards them will make them go up. Both of which are backfiring now of course.
People here are so wrapped up in the idea that bitcoin is just a big scam they can’t comprehend that people would willing put money into this, even if it is just basically betting.
I mean, it’s not a very good scam if no one wants to put money into it.
LeeAbe
2840
But people do, that’s why it’s still around. Yeah it’s down big right now, that happens a lot. Wall Street types just see it another way to make money.
