Cryptocurrencies

[TwoCitiesCapital]

3 hours ago, changegonnacome said:

Love it  

Was China reading my posts for the last few days  …….they sure do move fast over there

https://www.reuters.com/technology/chinese-financial-payment-bodies-barred-cryptocurrency-business-2021-05-18/

 

49 minutes ago, changegonnacome said:

Yeah China/India……no biggie………… just 2.8 BILLION people or pushing about 40% of the worlds population…….your right

Can you name a single financial institution that DID provide access to Bitcoin before this announcement? Can you even quantify what impact this has on network value currently? 

As far as I know, it was already difficult to buy it and required a VPN and the use of peer-to-peer exchanges as is. So please tell me what about this announcement makes the situation different than yesterday? 

[Parsad]

For the Chinese, the ban on crypto is more to do with unwanted outflows of capital.  China has extremely tight control on citizens/expats/businesses moving capital outside of China...they don't want to see an exodus, nor can they support a large-scale exodus of wealth and capital.  For years, capital has been flowing outside of China through BTC transactions in Macau...they have tried to cutoff the head there, but little luck.  They want to make sure mainstream Chinese institutions aren't moving capital outside using crypto as well.

Frankly, I'm surprised more nations aren't banning crypto...there is so much illegal activity occurring through crypto's ability to hide transactions and the ownership of wallets.  The amount of tax evasion occurring should also worry nation states.  I suspect the current batch of crypto's demise will come when nation states or large corporations issue their own digital currencies that are more stable, efficient and accepted internationally through mainstream institutions.  Cheers!

[JRM]

Serious question: with the price correction in progress what is a good entry price to start buying Bitcoin?  

What is the logic behind your entry price?

[Castanza]

Binance refusing withdraws of Ethereum due to "congestion" 

Coinbase is having issues and reporting outages

[hasilp89]

1 hour ago, JRM said:

Serious question: with the price correction in progress what is a good entry price to start buying Bitcoin?  

What is the logic behind your entry price?

$1

Logic: I have no clue what it is worth

(sorry i couldn't help myself).

[sleepydragon]

1 hour ago, JRM said:

Serious question: with the price correction in progress what is a good entry price to start buying Bitcoin?  

What is the logic behind your entry price?

It’s whatever the next person feels like to pay. It can be 40k, can be 40 cents. Cuz this thing doesn’t generate any cash flow. Not much different from collecting stamps. It’s whatever the next person willing to pay.

 

[Gregmal]

1 hour ago, JRM said:

Serious question: with the price correction in progress what is a good entry price to start buying Bitcoin?  

What is the logic behind your entry price?

I dont think you want to be a dip buyer. 

1) It could be a bubble or whatever...who knows? If it is, this very well could have been the peak, there were a lot of markers that point to it. My theory was that 2017 retail was retail driven, then next boom would be corporate/institutional. Who is left?

2) Wait at least until there is stabilization and its not on the front page everywhere. Buy tiny amounts over a stretched period of time. 

3) Since there is no real value here, only way to trade it on a price basis is probably irrelevantly significant numbers/technicals..IE Its YTD starting point ~$28k, previously breakout point ~$20k. Other than that no number means anything really. This moves hard in both directions. 

[SharperDingaan]

The outages are just the 'circuit breakers' kicking in. A NYSE would cease trading for 30 minutes, then resume. These exchanges just seize up instead, as they try to stay open while suddenly processing multiple times daily volume.

Last time China cracked down, it took a mere 6 days to find a way around it. There will be a temporary demonstration of heads on stakes, then business back to normal. The 'hard of learning' just get 'dissapeared'.

SD

Edited May 19, 2021 by SharperDingaan

[rkbabang]

48 minutes ago, Gregmal said:

My theory was that 2017 retail was retail driven, then next boom would be corporate/institutional. Who is left?

 

Very few people in the world own crypto, and even fewer institutions.  Yes, retail discovering crypto drove 2017 and a few institutions discovering it drove 2021, but mass adoption by retail and mass adoption by institutions is yet to come.  And using crypto on a daily basis by most of humanity hasn't even started.  When it is owned by 50%+ of public companies, 50%+ of university endowments, 50%+ union pension funds, 50%+ of mutual funds, 50%+ of individual investors, and most people on earth make crypto transactions weekly (or at least monthly) then it will stabilize.

When this happens any price you buy it now, even if you bought it at the top this year, will seem like a great price.  If you don't think the above will ever happen, then you think it is all going to $0 it might be a good idea to stay away from it all together.

 

[TwoCitiesCapital]

3 hours ago, JRM said:

Serious question: with the price correction in progress what is a good entry price to start buying Bitcoin?  

What is the logic behind your entry price?

If you're in it for long-term accumulation, I think prices in the 20ks-30ks make a LOT of sense to begin a DCA. The present value of the network value per coin in BTC is close to 20k and is growing by leaps and bounds each year. Paying a 50% premium that it will grow into in 12-24 months isn't much different than paying an above average multiple on a stock with high growth.

BTC also has a history of trading at multiples of this number (like ~15x at the peak in 2017 - a valuation that we've already grown into) so I'm not even certain we'll see the low-20s even if this is the "bust". 

I think the network value will be ~50k/coin minimum by 2023. I am willing to buy up to prices around that area. My last DCA (and highest priced one) was in late February at 47k. After that, I accumulated stable coins to prepare for the potential of a 50+% correction as witnessed in prior bull markets.  

Why didn't I sell it all @ 65k? 

1) Bitcoin has a history of trading at many multiples of its network value in a bull market (~15x at the top in 2017 - a valuation that we've now grown into just 4-years later)

2) This rally has been very shallow compared to historical ones from 2011, 2013, and 2017. It would not shock me if the ultimate termination is in the 150k range. 

It remains to be seen if this is just a 50% correction on the way to higher highs a la 2017 or the "bust" we've all been waiting for a la 2018. I'll be accumulating at prices below 40k and selling at prices above 100k and holding everything in between. 

 

2 hours ago, Castanza said:

Binance refusing withdraws of Ethereum due to "congestion" 

Coinbase is having issues and reporting outages

I don't know Binance's processes/operations. I know they've temporarily suspended withdrawals before and came back online shortly thereafter.

It makes sense to me though. This AM, the cost of Gas was ~1,500. This means it would have cost ~$100 to process a simple transfer of coins (not even execute a smart contract) which would have been hundreds, if not thousands, of dollars. A few months ago, anything above 100 gas would have been unheard of. Most recent highs during intense congestion were gas of 200-500. I can understand why Binance may not allow withdrawals if it's eating the $100 cost each time OR if the type of panic behavior that leads to 1,500 gas is also driving volumes they can't keep up with. 

This is one of the downsides of centralized exchanges. In DeFi you can get out at any time assuming you're willing to pay the fee for the transaction. Binance doesn't even give you that option. 

54 minutes ago, rkbabang said:

 

Very few people in the world own crypto, and even fewer institutions.  Yes, retail discovering crypto drove 2017 and a few institutions discovering it drove 2021, but mass adoption by retail and mass adoption by institutions is yet to come.  And using crypto on a daily basis by most of humanity hasn't even started.  When it is owned by 50%+ of public companies, 50%+ of university endowments, 50%+ union pension funds, 50%+ of mutual funds, 50%+ of individual investors, and most people on earth make crypto transactions weekly (or at least monthly) then it will stabilize.

When this happens any price you buy it now, even if you bought it at the top this year, will seem like a great price.  If you don't think the above will ever happen, then you think it is all going to $0 it might be a good idea to stay away from it all together.

 

+1

As I've said before, the price at the high in 2017 was ridiculous - but we grew into it in just 4-years. I don't think we'll view 65k any differently in 4-years (assuming this was in fact the high). 

Edited May 19, 2021 by TwoCitiesCapital

[DooDiligence]

BTFDKitty

[Gregmal]

1 hour ago, rkbabang said:

 

Very few people in the world own crypto, and even fewer institutions.  Yes, retail discovering crypto drove 2017 and a few institutions discovering it drove 2021, but mass adoption by retail and mass adoption by institutions is yet to come.  And using crypto on a daily basis by most of humanity hasn't even started.  When it is owned by 50%+ of public companies, 50%+ of university endowments, 50%+ union pension funds, 50%+ of mutual funds, 50%+ of individual investors, and most people on earth make crypto transactions weekly (or at least monthly) then it will stabilize.

When this happens any price you buy it now, even if you bought it at the top this year, will seem like a great price.  If you don't think the above will ever happen, then you think it is all going to $0 it might be a good idea to stay away from it all together.

 

Thats definitely accurate if this plays out, however I personally dont have what I'd call a high conviction opinion on the probability of that. This run up was highly predictable. Where it ends, or if it ends, I dont know so the process really is about allocation wisely and managing the risk. 

Even something like XRP....I bought a tiny spec position the weeks and days leading into the delisting(or whatever its called for this crap) at the major exchanges. The thesis was simple.

1) The SEC case was either nonsense or would get settled favorably. The SEC doesnt kill companies. 

2) I think XRP is worthless crap

3) I could be wrong about #2

4) 2 or 3 won't matter in terms of the timeline for the trade

 

Ultimately it was easy for me to have higher conviction in 1,3, and 4 than I did in 2. Even after the big crash XRP has gone from 30c to 1.25 in a few months on favorable developments in the case and we have yet to see a verdict in the case and reinstatement of widely accessible trading. But the process was easy and the same was the setup just with different variables for the BTC run following 2017. Easy. Which is why I just think people who sit around devoting tons of time to bashing this or criticizing something without putting any skin in the game are fools. Theyre almost intentionally passing up free money. I am not a huge believer in crypto and Ive managed to cash out nearly 2x my initial investment and still have about 4x times the initial investment freely riding. You've managed to pay off what? Like 3 mortgages lol? Where it ends, who know? But it'll be fun nonetheless. As always, managing risk and position sizing is probably the most important element when putting money to work. But that won't stop plenty of people from sitting around whining and harping on the wrong stuff. 

[SharperDingaan]

36 minutes ago, Gregmal said:

Thats definitely accurate if this plays out, however I personally dont have what I'd call a high conviction opinion on the probability of that. This run up was highly predictable. Where it ends, or if it ends, I dont know so the process really is about allocation wisely and managing the risk. 

Even something like XRP....I bought a tiny spec position the weeks and days leading into the delisting(or whatever its called for this crap) at the major exchanges. The thesis was simple.

1) The SEC case was either nonsense or would get settled favorably. The SEC doesnt kill companies. 

2) I think XRP is worthless crap

3) I could be wrong about #2

4) 2 or 3 won't matter in terms of the timeline for the trade

 

Ultimately it was easy for me to have higher conviction in 1,3, and 4 than I did in 2. Even after the big crash XRP has gone from 30c to 1.25 in a few months on favorable developments in the case and we have yet to see a verdict in the case and reinstatement of widely accessible trading. But the process was easy and the same was the setup just with different variables for the BTC run following 2017. Easy. Which is why I just think people who sit around devoting tons of time to bashing this or criticizing something without putting any skin in the game are fools. Theyre almost intentionally passing up free money. I am not a huge believer in crypto and Ive managed to cash out nearly 2x my initial investment and still have about 4x times the initial investment freely riding. You've managed to pay off what? Like 3 mortgages lol? Where it ends, who know? But it'll be fun nonetheless. As always, managing risk and position sizing is probably the most important element when putting money to work. But that won't stop plenty of people from sitting around whining and harping on the wrong stuff. 

The reality is that for the most part, sh1te coin is a < $1 investment/coin. It's penny stock for techies, and techie wannabe's; the junior coders, tech bloggers, etc. Could just as easily have bought a VSE listed mining stock, weed stock, or a biotech promoted by a paid tout. To each, his/her own poison - some you win, some you do not.

For the general public, BTC exposure is almost exclusively via an ETF. Those who hold their ETF as an actual 'investment' should do well, those who hold it primarily as a 'trading' vehicle ... not so much. Individuals who own their BTC directly are almost always very knowledgable about crypto. Those just owning Satoshi? ..... well - you get what you pay for. 

There is no right or wrong, merely help yourself to the pig out!

SD

 

[Castanza]

Are there risks to bitcoin due to not knowing who created it? Or is this risk somehow limited due to its characteristics? I can't imagine investing in a company if you had no idea who founded it and who the management team is. 

[rkbabang]

30 minutes ago, Castanza said:

Are there risks to bitcoin due to not knowing who created it? Or is this risk somehow limited due to its characteristics? I can't imagine investing in a company if you had no idea who founded it and who the management team is. 

Say a company you like goes public and you know everything you need to about the current management team and the founder has nothing to do with the company anymore and hasn’t in over a decade. Would it bother you to find out that the founder was using an alias and no one knows who he is?

That is pretty much the case with Bitcoin, Whoever Satoshi is or was, he has no control over Bitcoin today. And there is no management team, as it is just code. You have access to this code and can review it if you wish.  The code can not change unless a group with greater than 50% of the mining power chooses to change it.  So you don’t have to trust any management team, you just have to trust that most miners will act in their own best interests and that no individual, government, or small cartel ever invests in enough mining power to destroy it.

Edited May 19, 2021 by rkbabang

[JRM]

Is there a reason GBTC is trading at a ~78% discount to NAV?  It has high expenses, but why the steep discount?  Didn't this previously trade at a premium to NAV?

[Xaston]

6 minutes ago, JRM said:

Is there a reason GBTC is trading at a ~78% discount to NAV?  It has high expenses, but why the steep discount?  Didn't this previously trade at a premium to NAV?

I think its trading at like an 7-8% discount right now not 78%.

You should look at what their litecoin trust trades at if you wanna ponder about why one of these things is priced wrong.  I think its like a 1600% premium

[Gregmal]

I would think in theory the Grayscales should all trade at discounts. And that the discount should increase as more products or similar nature become available to investors. 

[Xaston]

This thread has too much discussion about bitcoin and not enough about ether.  Bitcoin is an amazing invention (I have owned since 2016 and spent a long time thinking about and discussing it before finally buying) and has permanent OG status but you can do so much more interesting shit on the ethereum network than you can on bitcoin.  That gap is only going to go up.   

How many of the people in this thread who are completely dismissive of crypto have ever even used metamask?  A revolution is unquestionably happening.  The amount of disintermediation and automation that crypto allows is immense, and that will have huge negative ramifications for lots of non-crypto-native companies and industries.  You genuinely don't have to learn about it and profit from it if you don't want to, but it is not going away and it is only going to do more things and gain more adoption.  

 

 

 

[JRM]

14 minutes ago, Xaston said:

I think its trading at like an 7-8% discount right now not 78%.

You should look at what their litecoin trust trades at if you wanna ponder about why one of these things is priced wrong.  I think its like a 1600% premium

According to Morningstar (may not be accurate), the price of GBTC is ~32 and the NAV is ~41, so ~78 cents on the dollar?

[Xaston]

1 minute ago, JRM said:

According to Morningstar (may not be accurate), the price of GBTC is ~32 and the NAV is ~41, so ~78 cents on the dollar?

I would call that a 22% discount to NAV, not a 78% discount to NAV, like you said in the other post. I do also think that number isn't accurate.  I follow @grayscaletrust on twitter for my up to date grayscale discount/premium numbers.

[TwoCitiesCapital]

1 hour ago, rkbabang said:

Say a company you like goes public and you know everything you need to about the current management team and the founder has nothing to do with the company anymore and hasn’t in over a decade. Would it bother you to find out that the founder was using an alias and no one knows who he is?

That is pretty much the case with Bitcoin, Whoever Satoshi is or was, he has no control over Bitcoin today. And there is no management team, as it is just code. You have access to this code and can review it if you wish.  The code can not change unless a group with greater than 50% of the mining power chooses to change it.  So you don’t have to trust any management team, you just have to trust that most miners will act in their own best interests and that no individual, government, or small cartel ever invests in enough mining power to destroy it.

The primary risk to Bitcoin would be the 1 million coins currently owned by wallets attributed to satoshi that haven't moved since Bitcoin's founding. 

And that's primarily a temporary risk of supply hitting the market. At this point, I don't think it actually matters who Satoshi is/was. 

1 hour ago, JRM said:

Is there a reason GBTC is trading at a ~78% discount to NAV?  It has high expenses, but why the steep discount?  Didn't this previously trade at a premium to NAV?

It has been @ a 15-20% discount for a few days as compared to a 40% premium back in December. Primary reason is because there are now ETFs in Canada (that trade OTC in the U.S.) where the same BTC exposure can be had for far more cheaply so demand for GBTC dropped sharply at the same time institutional investors lock ups ended. And because Greyscale is a trust, there is no mechanism to arbitrage it to NAV risklessly. 

They have stated they're actively working to morph it into an ETF. I expect it'll trade back to NAV at that point. In the meantime? Trade the expansion/contraction of the discount in an IRA.

I was buying at single digit premiums and selling at 20-40% premiums all throughout 2019/2020. Now I'm buying 15-20% discounts with the intention of flipping it at a 5% discount when sentiment improves. 

 

 

48 minutes ago, Gregmal said:

I would think in theory the Grayscales should all trade at discounts. And that the discount should increase as more products or similar nature become available to investors. 

I agree, but I do think 20% is bit on the high side. 5-10% is what I'd expect as long as the possiblity for ETF conversion is being dangled. 

38 minutes ago, Xaston said:

This thread has too much discussion about bitcoin and not enough about ether.  Bitcoin is an amazing invention (I have owned since 2016 and spent a long time thinking about and discussing it before finally buying) and has permanent OG status but you can do so much more interesting shit on the ethereum network than you can on bitcoin.  That gap is only going to go up.   

How many of the people in this thread who are completely dismissive of crypto have ever even used metamask?  A revolution is unquestionably happening.  The amount of disintermediation and automation that crypto allows is immense, and that will have huge negative ramifications for lots of non-crypto-native companies and industries.  You genuinely don't have to learn about it and profit from it if you don't want to, but it is not going away and it is only going to do more things and gain more adoption.  

 

 

 

I use metamask and DeFi. Very, very promising but there is a real argument on transaction fees. It's barely viable for me and I imagine I'm going at this with quite a bit more capital than the average Joe. 

I know there are supposed fixes with ETH 2.0, moving to PoS, and layer 2 solutions,  but a lot of uncertainty around the implementations and additional friction that may be introduced (by various layer 2 solutions for instance) by them keeps me wondering. Ultimately, I don't think ETH is quite ready for prime time yet, but if it gets there it will upend finance/banking as we know it. 

[changegonnacome]

5 hours ago, TwoCitiesCapital said:

network value per coin in BTC is close to 20k

Serious question - how is this worked out.....what are the variables required that spit out $20k as network value per coin - whats the equation....and where are the numbers sourced to plug in the variables in said equation

Edited May 19, 2021 by changegonnacome

[Parsad]

4 hours ago, rkbabang said:

Say a company you like goes public and you know everything you need to about the current management team and the founder has nothing to do with the company anymore and hasn’t in over a decade. Would it bother you to find out that the founder was using an alias and no one knows who he is?

That is pretty much the case with Bitcoin, Whoever Satoshi is or was, he has no control over Bitcoin today. And there is no management team, as it is just code. You have access to this code and can review it if you wish.  The code can not change unless a group with greater than 50% of the mining power chooses to change it.  So you don’t have to trust any management team, you just have to trust that most miners will act in their own best interests and that no individual, government, or small cartel ever invests in enough mining power to destroy it.

But what is it?  Cheers!

[changegonnacome]

4 hours ago, rkbabang said:

Say a company you like goes public and you know everything you need to about the current management team and the founder has nothing to do with the company anymore and hasn’t in over a decade. Would it bother you to find out that the founder was using an alias and no one knows who he is?

That is pretty much the case with Bitcoin, Whoever Satoshi is or was, he has no control over Bitcoin today. And there is no management team, as it is just code. You have access to this code and can review it if you wish.  The code can not change unless a group with greater than 50% of the mining power chooses to change it.  So you don’t have to trust any management team, you just have to trust that most miners will act in their own best interests and that no individual, government, or small cartel ever invests in enough mining power to destroy it.

Looks to me like Elon Musk has management control of Bitcoin right now, its price & adoption curve at the very least - ...........that isnt a good look for a supposedly decentralized currency thats meant to act like a store of value

Try as he might haven't seen a single thing Elon has ever said/done or tweeted that's moved USD exchange rates..........USD 1  - BTC 0 in my book