Posted on 02/01/2024 8:27:45 AM PST by Victor
Everything is a scam.
The only difference is that I can use some scams to pay my bills—and not others.
Thanks.That caught my attention.
So...is a well run Crypto/Bitcoin operation a "project" run by a "team" of experts? And if a person is successful, it's mainly because of the expertise of a "team" of people?
Unlike the "smaller" cryptos....?
How would you define them?
You know there are now Bitcoin ETF's, now, right? So you can now directly invest via traditional brokerage channels, though strictly speaking you are just paying fees to do something you could as easily do yourself with a paper/hardware/software wallet and no fees to hold your investment. But for many people (especially the sort that lose their passwords) that's probably the better option for now.
There are exchanges like Coinbase and others and there is a market for cryptocurrencies. You can see the valuations of each up to the second on the market. You can sell your crypto and convert it back to dollars just as you can convert dollars into crypto by buying any of the various crypto currencies.
All cryptocurrencies are tied to blockchains. Various cryptocurrencies do different things. Some do nothing really. Some are a store of value (like Bitcoin) that cannot be manipulated by any government. There is a set amount of Bitcoin that can ever exist. There cannot possibly be any inflation. Starting to see why governments hate it?
Other crypto currencies are tied to blockchains that do quite useful things. Ethereum, Chainlink, XRP, etc.
Its the early days of this asset class so there are plenty of shady characters and yes, scams. Profit potential is also much higher than with any other asset class - or at least it has been so long as crypto currencies have existed which is about 14 years at this point.
There’s much more but those are the basics.
If you are looking at investing, and seem to be enamored with the BTC fad, I suggest you listen to Dave Ramsey and hear his thoughts on the subject. He has spoken about it on his show regularly. I agree with others that one probably shouldnt put high weight in financial advice from strangers on FR or any other social media platform. Seek an expert. If not someone like Dave Ramsey, then a professional advisor from a reputable firm like First Command.
I like Dave Ramsey but he is compromised because of his relationship with “Smartvestor Pros”.
They get very high fees—a percentage of the dollars invested.
If folks need investment advice they should pay for it by the hour, not as a percentage of dollars invested.
https://www.bogleheads.org/wiki/How_much_do_you_lose_to_annual_fees_after_many_years%3F
Thank you
A good cryptocurrency is decentralized and open-source. That means anyone can be involved in decision-making (I was as noisy as anyone in the debates during the bitcoin civil war in 2016-17). Actual changes are decentralized, meaning it is up to individuals which version of the code they download or update. This means if there are two or more significant camps, a fork will occur over some topics. People who hold a coin will find themselves holding the same amount of coin in each fork, and both may retain significant value for however long there is a community supporting each fork (years now in some cases, though in most cases one side dwindles after a time.) This is how bitcoin works - there is no leadership, just scores of coders and thousands of opinionated louts suggesting or shouting down changes, and the best get tested up the wazoo and made available for implementation.
By contrast most smaller projects are inherently centralized in that there is a single development team. In theory anyone could "take over" since the software is virtually always open-source, but this involved convincing the community that you have better ideas/vision and are more trustworthy than the original dev team. Unlikely, but on occasion it happens especially when trying to rescue a currency either started or co-opted by bad actors. So, even in the case of a centralized dev team that is incompetent or corrupt, there have proven to be decentralized solutions to fix the situation, albeit with difficulty. Imagine a white knight coming along to rescue the dollar after a bout of mismanagement by the Fed for example, with popular support. That can't really happen in the government fiat world.
What you describe is a service, for which fees would seem reasonable. That is not a good argument for BTC as an investment. My original post stated my own personal two rules for investing: I need to understand the business plan for investor profit, and I need to know that the investment is one where my financial interests are the focus (fiduciary accountability), and not some woke or environmental social justice concern.
I trust Bitcoin because it is on a blockchain that prevents creation of any more Bitcoins (i.e., it can’t be inflated.) I don’t trust the other cryptos as much.
That's some good advice, right there.
However, I've been a member of FR since its inception around 1997 and over the years I've seen a lot of well-informed conservative minds answer a lot of profound questions...
So I thought I'd give it a try-
This is the simple minimum you need, in Python:
https://www.freecodecamp.org/news/create-cryptocurrency-using-python/
Type it in, one afternoon.
I have moved to investments where the fee is based on the account value, not on the trades. So my broker gets his cut and his cut is better if my account grows more. That percentage for my broker is less than a percent while my returns have been greater than 20 percent for the last decade, with few exceptions.
One should never invest in cryptocurrencies. I have sunk a few thousand into various funds but only $$$ I could afford to lose.
It’s like gambling or playing the lottery. Some people are going to get rich. But not you.
You are probably still overpaying on fees unless they are a very small percentage of your total accounts.
The chart I posted above shows the damage.
Many thoughts. None conclusive.
1. Prices for crypto-coins are entirely based on supply, demand, and speculation (expectation of future value).
2. They’re the ultimate “vapor-ware” - they exist only as a string of 1’s and 0’s, stored on an encrypted memory device.
3. They are backed by nothing, other than “I want to believe.”
4. Their continued use & growth is only as good as their utility and anonymity.
5. Their greatest utility is the private, near-instantaneous exchange of funds between parties without bank involvement or hard-currency. The fact that these transactions can happen globally is a big threat to banks, and their foreign-exchange operations and revenues.
6. They are hated by governments and central banks, as they’re not easily tracked, and they’re unable to control them. Frankly, they don’t like the competition.
7. When you peel back the onion, Sam Bankman-Fried scammed billions from un-witting investors because they believed his hype. His initial premise of facilitating crypto trading (acting as an intermediary for buyers and sellers of crypto via FTX Exchange) was sound - it is what CoinBase does today (among others). But he saw a gaping, glaring weakness in cryptos in general: he saw creating his own crypto-coin (FTT) as a way to literally print his own currency. So he sold FTT “tokens” to the rich, true-believe crowd; he then took those real currencies he received, and went on a years-long spending spree - buying everything from real-estate and exotic cards, to politicians. His won’t be the last token to have a spectacular death.
8. The greatest threat to cryptos is government, and government regulation. They simply will not tolerate alternate currencies and anonymity in the long run.
[/soapbox]
My performance says otherwise. I am mostly Roth at this point so 20% + tax free is pretty good to me.
Sam Bankman-Fried
That’s all you need to know.
Bitcoin is pretty anti-woke/ESG, with its foundation in energy-intensive mining and its neutrality in the sense of being allocated based on mining, not some racial quota or whatever.
A big hang-up for me initially is that I don't like the idea of investing in anything "inert" - a lump of gold just sits there, for example, and cash in my bedroom isn't working to earn more cash. I initially thought of bitcoin in the same way. By contrast when I invest in a stock, the workers are trying to make a profit, which comes back to me in the form of dividends so that my money makes more money.
I had an epiphany one day when I realized that when I invested into bitcoin, I was in effect buying "shares" in an enterprise composed of thousands of very motivated, energized developers. Some were working on improvements to the code. Others were working on numerous businesses that would utilize bitcoin it various ways. All of which was improving the prospects for bitcoin use and valuation. That remains true today, and turned out to be an exceedingly valuable insight. The same could be said for Ethereum and other smart-contract coins and the legions developing them, as well as niche coins like Monero (anonymity), Nano (instant TX) and so on.
Performance and fees are separate issues.
It is like saying you love your Mazerati because it performs well.
That provides no information on whether you paid a reasonable price when you bought it.
Run the numbers on the chart and figure out how much you paid in fees over the years.
Then see if you can get a better deal without sacrificing performance.
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