Cryptocurrencies

Hoi Ladies & Gents,

Do you buy any cryptocurrencies? Or do you do any other alternative investments?

PS. If you planning to buy some crypto, it seems that now is a good moment:

This is quite tricky.

There is no doubt that there is a lot of usecases for cryptocurrencies.
The fact that I’ve seen articles about Bitcoin on the first page of “20 minutes” newspaper makes me ask a lot of questions about its merits from an investment point of view. Looks a lot like the dotcom craze to me.

Regarding the title of the link, I have seen a very good comment about Bitcoin yesterday : “Oh my god! Prices are crashing to a level not seen since the last two weeks!”

1 Like

to me the cryptocurrencies are entirely speculative - i have exactly zero idea (and i believe 99% of the people don’t have more) about it’s future development.

from this point of view I would be willing to make “bitcoin” or “Ethereum” part of my portfolio as any other individual stock - order of magnitude 0.01% maybe (assuming i am passively invested in 10’000 different stocks).

That is too small to bother.

If I’d go beyond the 0.01% I will get right into what we all know as stock picking. only here, there is no annual report, no smart management that has interest in generating returns, no assets, no nothing, only bits.

Therefore I will stay away from cryptocurrencies for now.

/edit i thought about crypto currency farming, but it would take me a while to read up stuff. As of yet, I have no idea about it.

1 Like

I also think cryptocurrencies are speculative, even though my experience with them has been positive. More than 6 years ago there was a website advertising bitcoin that gave you 0.02 BTC (10 cents or so at the time) for clicking on a button. Now my bitcoins are worth $50, so this is probably my most successful “investment”. :smiley:

2 Likes

I have a modest holding with a cost basis of a couple hundred that’s now worth maybe 5-10x more

My small hedge against all hell breaking lose in the world of fiat paper money and its insatiable printing by the central banks with QE programmes

Supply is constrained, so it’s quite obviously going to appreciate in the long run, as long as it doesn’t fall out of favor, which is why you maybe want to diversify across multiple cryptocoins. Otherwise for short term it’s rather speculative and highly volatile

1 Like

For that reason, I have physical gold hidden safely in another country.

Once bitcoins start crowding out government currencies, then governments will follow Russian government and ban bitcoin - or even better, they will confiscate it. Not sure if in the long term, the constrained supply will help. I think for a hedge against inflation and other government confiscation, gold is safer, but I’m still buying bitcoin in small proportions though - to diversify the risks.

Well technically etherium has an actual use (which is in theory quite cool) besides being currency and there are a couple companies backing/using it by now, however I never actually bought any cryptocurrency but I mined a couple.

I used to mine Dogecoin for fun and was in holiday without access to my wallets when the price exploded, when I got back the price was in the basement so I put half of my Dogecoin into a broker account so I would be ready for the next spike (did not happen) but then the broker exploded and took my holding with it XD. So that was a fail, still got 50k Dogecoin laying around waiting for them to be worth anything.

I also mined Etherium before the fork but exchanged most of them for bitcoin back when they were at 50$ (now over 300$).

But I have never really done it for profit but more for fun since I do not think I am smart enough to really profit form such a volatile market.

I almost started mining Bitcoins back when you could mine 50+ per day on a modest PC but of course I thought it would not be profitable XD. Mean a couple of weeks and I would be FI by now, well you can not know everything.

Well If i could tell my 16 year old self something it would be: “Mine bitcoin, sell when it hits 1.2k and read MMM”

Confiscating Bitcoin is harder than it sounds, sometimes law enforcement get lucky, mostly not and if the get lucky a couple of times there are easy ways around that. Banning it is also not as trivial as one might think, even with china style censorship.

2 Likes

Can you confirm that? Because I read articles where they said, the Russian government didn’t ban Bitcoins in the end.

Hi all

I went into ethereum a year ago and it was quiet a (profitable) journey (10x my Investment). I bought some more ether, monero and zcash when this thread was started in early june, but i do think it is expensive now and risky, especially if you are not already in cryptocurrencies.
I think the tech behind all the stuff is still very experimental and most of it is overvalued. But i think there will be another hype cycle where more mainstream comes in and the bubble grows larger before it bursts - but nobody can predict the future.
I consider it as a high risk investment and i think the most interesting chances are maybe new coin offerings (initial coin offering - ico), but be aware that a lot of them are also scams.

I participated in the following ICO’s, both focused on creating Visa cards where so you can spend your cryptocurrencies for real world stuff
https://mona.co
https://www.tenx.tech

I could post more results, how these ICO’s went. They will release the coins soon and my strategy is to sell a part early to get back my invested money and go long with the rest of it.

BTW: I am aware of the mustachian way and i have to learn a lot about safer and longterm investments - but my investment career is young and only in cryptocurrencies for now. Hope to change that soon :wink:

Dear all,
Swissquote started trading Bitcoin today. If you were put off by the complexity and the risks of holding bitcoins yourselves, it might be a good opportunity for you.

You beat me to it, I was just coming here to post about it!

http://www.marketwired.com/press-release/bitstamp-swissquote-pioneer-bitcoin-integration-with-traditional-financial-system-2226176.htm

I’ve been looking into cryptocurrencies lately, I think the tech is really interesting and that they will eventually dominate the world. It might even make sense now as another asset class to diversify a portfolio. https://www.forbes.com/sites/laurashin/2016/07/12/want-higher-returns-invest-in-bitcoin-say-arks-chris-burniske-and-coinbases-adam-white/

On the other hand, it seems like a super speculative investment and I think I’m mostly reacting to the get-rich-quick success stories and the FoMO.

So I’m still on the fence. :slight_smile:

Oh boy this looks like an accident waiting to happen, using traditional banking security for BTC might not be a good idea.
At least they probably have better insurance than al the other hacked exchanges.

Still I find it cool that Crypto reaches the mainstream like that.

I think it is potentially better than gold since the supply is very stable and known and it is more convenient to trade and still something you could keep under your mattress (in a save paper wallet). But it will take some time untill it reaches gold stability.

Or you could have just written the winning lottery numbers :smirk: . But the MMM advice would definitely be good in order not to spend all this money too fast.

I’m quite fascinated by crypto currencies and their incredible value gain rate. I have never bought any. My concern about the use of bitcoin as the storage of value (and hedge against fiat currency) is that it has many alternatives. What problem is there to create a bitcoin2, bitcoin3 etc?

I guess this already happens. Ethereum market cap is chasing the one of bitcoin. If ethereum didn’t exist, then probably the price of bitcoin would be even higher already.

It’s not quite the real deal. Apparently you can’t deposit nor withdraw your coins from them, it’s just a virtual bet on the difference. Cut out this useless middle man, go to exchange - they’ve partnered with bitstamp and so can you

1 Like

Interesting piece on BTC correlation with other asset classes - there practically isn’t one (but there wasn’t much of bear market it its lifetime so far), makes it very attractive for portfolio construction
https://seekingalpha.com/article/4047264-bitcoins-correlation-financial-assets

I think i’ll increase my exposure to cryptos a little

3 Likes

Useless ? really ?

If people buy on an exchange, they then have to handle their coins themselves. Thus they have to learn how to deal with a wallet on their computer and hope that they never get hacked or a virus and that they do backups. But if they have a non negligible amout of bitcoins this is not enough. People should make a paper wallet on an air gaped computer and store them safely (from water, fire, thief, extorsion). Of course any mistake can result in the complete loss of their money.
OR they can delegate this duty to Swissquote :slight_smile:

I think that Swissquote’s service is exactly what is needed for people to get exposure to cryptocurrencies without too much risks.

2 Likes

Well, don’t underestimate the risks specific to them too - they’re your counterparty in this deal. They allow you to bet on BTC value, and they’re the only ones who would ultimately owe you money if the bet pays out. If they or bitstamp go bankrupt, or get hacked (again!) and coins backing their side of the bet disappear (BTC transactions are irreversible), you’re facing a potential loss. Swissquote is balls deep in all other sorts of CFD products, btw, so it’s only natural they finally opened up a BTC casino.

If you manage the cryptos yourself, this too has risks, but counterparty risk is then only for a short time when trading.

Securely backing up your digital data takes a bit of discipline, but is not exactly rocket science. And if you go for example for keeping keys on paper, it’s a lot like holding paper stock certificates in the good old days with same risks

My own take on BTC is as a hedge against catastrophic failure of traditional financial system, so I’m pretty concerned about counterparty risks in this scenario.

1 Like

If you have bitcoins and haven’t been following the cryptocurrency news, you should take a look at this:

Basically, on the 1st of August a new coin is going to be created from the current bitcoin blockchain. What this means is that if you control your own bitcoins you will suddenly have two coins. The new one will probably not be worth much, at least at first, but you never know. If you keep your coins in an exchange, you will probably not get the new coins, so I would recommend you transfer everything to your own private wallets.

(Maybe we should open a new section of this forum for cryptocurrencies?)

2 Likes

Lol another fork, I already have 2 kinds of Ether XD.

+1 on the Crypto section in the forum

1 Like

On kraken you got Bitcoin Cash for all Bitcoins automatically and this was the same for Ethereum Classic a year ago. But it’s better anyway to not keep the cash on the exchanges.

I will need to buy myself a hardware wallet, can anyone recommend a product?

+1 for a crypto section from me as well, that would be awesome :heart_eyes:

1 Like
By reading and partipating to this forum, you confirm you have read and agree with the disclaimer presented on http://www.mustachianpost.com/
En lisant et participant à ce forum, vous confirmez avoir lu et être d'accord avec l'avis de dégagement de responsabilité présenté sur http://www.mustachianpost.com/fr/