Crypto investing 2022

Are you guys still putting money into crypto?

I didn’t put much into so far, probably 0.5% of my NW, now even a smaller part after the rout.

I initially invested into some alt coins as alternative to lottery as I always thought crypto value is zero, but never know if you get lucky. It won’t break the bank.

Technically we should DCA but I an getting bored and pissed to throw more money at it.

What are you guys doing? Still DCA? Changing strategy? (Investing more in alt and less in bit/eth or opposite)

Looking for some inspiration before throwing more $$$

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I would DCA 100 CHF in BTC and ETH every month if I could :slight_smile: I think that in 5 years, or at least for the next havling, the market should go better, or at least at the end of the current bear market as crypto seems to be more and more corelated to the stock exchange.

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Indexing, adding something little, don’t even know how much.

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I‘m still putting some money into it, but it’s true that with the end of Monetary policy that we had since 2008 it’s slightly a different game. I would not put in to much. I do ETH and DOT right now and staking/yield farming as good as possible but not in a real plan. Which is basically the same approach that I do for ETF/shares ratio is 5000:300 per month

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Not adding anything since 2017, just HODLing and letting it ride.

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I stopped “investing” in crypto some years ago and will never spend a cent anymore on it. The more you think and engage with the topic, the less it makes sense. It doesn’t even have something to do with investing it’s more like gambling e.g. playing Swiss Lotto or Euromillions. I stopped doing that several years ago too. There are solutions already in place and will appear on the market that are faster, cheaper, more efficient, more sustainable, and more convenient than any crypto solution even could be.

The problem of centralisation/de-centralisation is more or less a political question and regulation of one and/or the other. Even a de-centralised currency could be regulated in ways that at the benefits of decentralisation gets lost.

The only coins that would have had a chance for wider adoption (BTC and ETH) are too flawed to make it into a mainstream currency, all the other ones without the first mover advantage will never make it to become more than a project for nerds. Just because some crypto nerds dig into the jungle of various alt coins etc. doesn’t mean the 99.99% regular folks out there will ever hear or read of those.

In the long term, the only ones that will have made or make money with crypto are very few high risk speculators and all the institutions that make a hell lot of money by allowing you to buy and sell all those coins i.e. banks, crypto exchanges, crypto apps/providers, whatever, and those who provide services around cryptos such as consulting, etc., but not the investors.

So I think every cent “invested” in cryptos is wasted effort and money that could instead be invested into real investments :wink:

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2022 has been a global advertising on why we need bitcoin. So, yes, no surprise, I have a weekly DCA in place.

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And the ad was the 36% YTD drop?

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No haven’t you seen how sucessful it was in El Salvador…

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There is more happening in the world than the bitcoin price :thinking:

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Well, this is just normal volatility.

Bolivia is a special case though. The reason why crypto is illegal in Bolivia is because there have been ponzi systems in place to rip of people during the 2017 bull run. And as the government is pretty ignorant they addressed this crime with a general bane of crypto. Of course people can still use crypto in Bolivia but they can not sell/transfer to anybody officially.

However, there is a lot more behind this from a socioeconomic point of view. Also to have US$ on an account does cost you extra money compared to the Boliviano. So far thanks to the revenue of selling gas to Argentina and Brazil the prices between US$ and Boliviano is relatively stable (which is already a big achievement) but once the government is running out of US$ there will be huge problems (also gas seems to be running lower and probably only last for less than a decade) and therefore the government tries to get all the people into Bolivianos where they could control the people way better.

In my opinion Bolivia is actually a perfect example why crypto is needed also in the future to gain independence from a strong ruling party

I’m sorry, I somehow mixed it up with El Salvador, which adopted Bitcoin as a legal tender.

The main arguments I hear for crypto is:

  • it’s a hedge against inflation, similar to gold → it’s definitely not as 2022 showed perfectly well
  • it’s uncorrelated to stocks, this may be partly true, but it’s highly correlated with monetary policy
  • anonymosity → not the case for bitcoin, everywhere you can buy Bitcoin you need to provide KYC, etc.
  • decentralisation → a small number of investors hold a significant amount of bitcoin and the risk that they take control is not negligible, also governments don’t need to know your actual transactions, it’s enough that they know that you do stuff in crypto and punish you for it
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I recommend the bitcoin “Black Paper” by former crypto-advocate Nassim Taleb (“Black Swan”, “Antifragile”). Here’s the abstract:

In its current version, in spite of the hype, bitcoin failed to satisfy the notion of “currency without government” (it proved to not even be a currency at all), can be neither a short nor long term store of value (its expected value is no higher than 0), cannot operate as a reliable inflation hedge, and, worst of all, does not constitute, not even remotely, a safe haven for one’s investments, a shield against government tyranny, or a tail protection vehicle for catastrophic episodes.

Furthermore, bitcoin promoters appear to conflate the success of a payment mechanism (as a decentralized mode of exchange), which so far has failed, with the speculative variations in the price of a zero-sum maxi- mally fragile asset with massive negative externalities.

Going through monetary history, we show how a true numeraire must be one of minimum variance with respect to an arbitrary basket of goods and services, how gold and silver lost their inflation hedge status during the Hunt brothers squeeze in the late 1970s and what would be required from a true inflation hedged store of value.

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Still investing in small caps under $10M or $100M marketcap, still not buying any btc or eth, still staying away from shitcoins :smiley:

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The hedge against inflation is quite similar to gold from a availability perspective. Right now also gold does not behave as it should according to inflation hedge theory.

As always it’s a numbers game if you would have had 10 years ago 100$ in cash, in gold, in btc and in shares you would be best of with the btc, but nobody knows what the situation will look like 10 years from now.

Define “real” investments, please.

An investment is when you sacrifice something now, usually money, for something that is likely to develop positively in a long-term perspective, so you can harvest a profit in the long run.

I do not consider day trading, CFD trading or pure options trading as investing, as those activities are more related to speculation and more close to participating in a lottery. Of course, there are also lottery millionaires and even billionaires, and there are also people who become rich over night in a Casino.

Crypto belongs definitely into the speculative area and has nothing to do with investing IMO. It’s more like buying a lottery ticket where you speculate that somewhen in the future there will be another idiot who buys a worthless piece of bits and bytes from you for a higher price. There is a huge industry behind this and few tech nerds that try to push and hype it, but eventually the only ones who will make money through it will be the banks, exchanges, product vendors, and consulting companies, not the “investors”. Of course, there will be a few exceptions who took high risks but those will be very few lucky guys like those Casino billionaires etc.

Eventually there are those who will offer YT videos, books, expensive online courses and seminars on how to become rich too like those few examples, triggering FOMO, nurturing the hype etc. but eventually none of them will make money trading cryptos, they will make money selling courses, seminars, and books, etc. Same like those day trading gurus. Pattern repeats, just a new product now.

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Thanks for your reply. But how is this different to speculation:

An investment is when you sacrifice something now, usually money, for something that is likely to develop positively in a long-term perspective, so you can harvest a profit in the long run.

Ultimately the price of anything is set by whatever people are prepared to pay for it. Yes, you could argue that there are ways of assessing value, but if you buy a share of Tesla, for example, you are assuming based on whatever your thesis is, that the price will appreciate so that at a later point you can sell it for a profit to “another idiot”. I am not sure how this differs to buying 1 BTC, for example, and making a separate thesis that this too will appreciate in value for whatever reasons you ascribe to it.

I agree that there is a lot of smoke and mirrors and snake oil salesman attached to crypto, at least in it’s current form. But I believe it closer to the the rise of a new industry, akin to the rise of internet companies than a tulip-style bubble that will be gone entirely in 5 years time. The vast majority that exist now will fail, but I believe that the children of today are more likely to want to invest in digital currencies and digital property in the future than shares of P&G or physical gold. And therefore I ascribe it value and therefore regard it as an investment accordingly. If that makes me the next idiot to buy “a worthless piece of bits and bytes” so be it. Perhaps you’re the other idiot buying what you regard as a “real investment” from someone like myself who has already captured the profit from them…

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It’s very different.

If you invest in Tesla stocks you buy a part of a company and that company in turn can work with your money. The company produces something what the consumers want, the company has an intrinsic value and it creates value and as such people are willing to buy their products. Of course, when you buy the stock there is a thesis behind it and you believe in the business model of that company. And companies can fail.

The difference is how credible a certain thesis is and what the probability is that one might be right. Of course, there is no investment thesis with probability 1 and we can’t know for sure what the probability actually is … maybe 0.6, maybe 0.4, who knows, time will tell if we were right. That’s why many of us buy broadly diversified ETFs to diversify the risk when we were/would have been wrong. We also know from historical data that there is a way to invest with a good chance into something and gain a small profit from it.

When we look at crypto this is very different. You hear stuff like we need crypto because XYZ. What we need and what is likely going to be the reality are two very different things. If you say crypto is a huge market and there is lots of money to be made, then yes, you’re certainly right. There are lots of people who buy everything that has crypto in the name and they are willing to pay lot of money for it. There will be people who pay money for digital clothing for their avatars, etc. But it’s not the people who make money using that technology. It’s the banks, the exchanges, the consulting companies, the product vendors, those who allow people to trade those assets and those who create digital clothing for your digital avatars you buy. Not those who trade it or those who buy a digital LV bag for their avatar.

There are wild theories around that crypto will replace FIAT currency, crypto will gain +100%+ every year (those numbers are just not sustainable - it’s simply not possible that lots of people make such profits on the long run). Nobody who actually knows and understands a bit about those things such as economists, central banks, government officials, law makers, people in positions who actually have the power to decide about such things and even the majority of the population believe any of this. It’s some nerds and companies who tell those stories to make money with it.

You’re trying to give the crypto takes over the world thesis the same credibility and probability like other investment theses whereas in fact it’s more closer to wild fantasies of certain tech nerds and the greed of companies who found another method to make money with people’s ignorance or naivety, triggering their instincts such as fear of missing out on becoming rich, etc.