The sharp fall in the share price of Tesla is what might put Musk's Twitter deal in trouble.
The sharp fall in the share price of Tesla is what might put Musk's Twitter deal in trouble.
RobAnybody
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Exactly. This is the same as collecting Beanie Babies. Or Rookie Cards, Or Comic Books.
Only put in what you can afford to lose.
ywhtptgtfo
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There's a lot of propaganda behind cryptocurrency because there's a lot of financial interest behind it. What makes for a good spin is to conflate the idea of (1) using cryptocurrency with the idea of (2) adopting any of the mainstream coins as currency.
Cryptocurrencies have some desirable properties but that doesn't mean Bitcoin or Ethereum should be currencies. Proponents of these coins like to cite how they are there to take power from financial elites but in reality they and everyone are just treating these coins as their investments, They want people to buy in so that the value go up and they can be even richer without doing anything.
In my view, for cryptocurrency to really work as a currency, it needs to be introduced as something other than a get-rich-quick scheme which Bitcoin and Ethereum very much are. Good currencies should not be volatile
Cryptocurrencies have some desirable properties but that doesn't mean Bitcoin or Ethereum should be currencies. Proponents of these coins like to cite how they are there to take power from financial elites but in reality they and everyone are just treating these coins as their investments, They want people to buy in so that the value go up and they can be even richer without doing anything.
In my view, for cryptocurrency to really work as a currency, it needs to be introduced as something other than a get-rich-quick scheme which Bitcoin and Ethereum very much are. Good currencies should not be volatile
amadeus
Bishop of Bio-Dome
I think to call it an investment it has to have some property like others do. What does something like a bitcoin have?
Bonds have a fixed return, the risks are understood and usually built in to the interest rate. A stable U.S. bond isn’t going to pay a 20% return, but an Argentine bond might. Or it might not!
Stocks, the performance of a company can be measured. Anyone want a piece of Sears?
Forex gets a little closer but even then there are central banks that have interest rates and this falls more on the speculative side.
But what’s a bitcoin? The investment is just guessing whether someone else values it more than you do, and it’s not even a thing. It’s what, a string of numbers? I can make numbers. Six! Eleven? Ninety-eight.
Where’s my scrilla?
Bonds have a fixed return, the risks are understood and usually built in to the interest rate. A stable U.S. bond isn’t going to pay a 20% return, but an Argentine bond might. Or it might not!
Stocks, the performance of a company can be measured. Anyone want a piece of Sears?
Forex gets a little closer but even then there are central banks that have interest rates and this falls more on the speculative side.
But what’s a bitcoin? The investment is just guessing whether someone else values it more than you do, and it’s not even a thing. It’s what, a string of numbers? I can make numbers. Six! Eleven? Ninety-eight.
Where’s my scrilla?
Most of those are not investment either. Investment means spending money to increase productive capacity. Forex is speculation, stocks unless you buy them at an IPO are speculation/store of value. Bonds are store of value.
amadeus
Bishop of Bio-Dome
I was thinking from the perspective of the retail consumer what we consider to be investments. A card counter who plays perfect strategy and isn't flat betted can beat the house, but we don't call that an investment. The more I think about it, the more I'd consider counting cards to be more of a stable "investment" than bitcoin when it comes to being able to produce some modicum of a predictable return.
Lexicus
Deity
Cryptocurrencies are pump-and-dump schemes. No one can make money on them without others losing money.
That is similarly true for the USD.
Lexicus
Deity
The USD has utility outside of being an investment vehicle, which none of the cryptocurrencies do (unless you count buying child porn, sex slaves, and illegal drugs as a utility I guess). Anything they can do normal currency can do better.
stinkubus
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While I most agree with you in principle there is one big difference between USD and cryptocurrencies. The value of the USD is supported by its compelled use in international finance and commodities markets. Bitcoins don't have a military or intelligence agencies ready to overthrow sovereign governments to ensure its continued acceptance as legal tender.
I was mostly referring to the unique market sectors such as you list, but there are a few more. They could be really valuable for such things once physical money is deprecated.
True, but their little bit of utility does exist.
I have no problem with people thinking of it as a speculative asset, because it is. My contention is with the word 'investment'. I think we should be fighting to recover that word, one conversation at a time. Traders speculating on assets is one thing, with a fairly identifiable harms and risks. Super-speculative assets, like bitcoin (or beanie babies) produce less value (I guess, at the end, the future has more well-kept beanie babies available). But, you'll note, we apply tax benefits as if they're equally beneficial to society.
It's because we're falling for an epic bait-and-switch on a heuristic. And it's worth pushing back, imo.
ywhtptgtfo
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USD does not double or half in value when Dow Jones suffers a burp
Those ancient lawmakers do not understand crypto, and are trying to make it illegal to lie to get people to give you money!!! Do they not understand that the whole system uses the generation of bullfeathers to mine idiots!!
Yield generation app Stablegains could be facing a class-action lawsuit after the company lost more than $44 million of customers’ funds by investing them in Terra’s failed UST stablecoin.
The company marketed itself as a “simple and safe” way for its users to benefit from “advances in financial technology.” Documentation on the Stablegains website assured users that the value of their deposited assets would remain stable “regardless if the crypto markets are soaring or crashing.” Stablegains' website had stated they primarily generated yields through the asset-backed stablecoin USDC.
In reality, Stablegains took customers’ U.S. dollar deposits, converted them to UST [algorithmic "stablecoin", very different from assest backed], and deposited them into Anchor Protocol. Anchor, a Terra-based lending and borrowing DeFi platform, guaranteed 18% APY on UST deposits before the algorithmic stablecoin lost its peg and crashed the Terra ecosystem. Stablegains skimmed 3% off Anchor’s yields for its trouble while returning the remaining 15% to customers.
The company marketed itself as a “simple and safe” way for its users to benefit from “advances in financial technology.” Documentation on the Stablegains website assured users that the value of their deposited assets would remain stable “regardless if the crypto markets are soaring or crashing.” Stablegains' website had stated they primarily generated yields through the asset-backed stablecoin USDC.
In reality, Stablegains took customers’ U.S. dollar deposits, converted them to UST [algorithmic "stablecoin", very different from assest backed], and deposited them into Anchor Protocol. Anchor, a Terra-based lending and borrowing DeFi platform, guaranteed 18% APY on UST deposits before the algorithmic stablecoin lost its peg and crashed the Terra ecosystem. Stablegains skimmed 3% off Anchor’s yields for its trouble while returning the remaining 15% to customers.
Spoiler The claim screenshotted :
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RobAnybody
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I am sad about the demise of Terra. My 10 whole Terra coins are now worthless. I should have known better though. The only reason I bought some was because it was named after my favorite comic book character (which is as sound a reason as any to invest in crypto), but I should have kept in mind that Terra died at the end of The Judas Contract storyline in Teen Titans. 
Comments from Davos on cryptocurrencies:
That said, Georgieva noted that digital money can be a "global public good" that can help people send remittances across borders. The key is for interoperability, so that it is just as easy to transfer digital currencies as it is paper-backed currencies like the dollar and euro.
One thing that cryptocurrencies are very good at is being easy to send money to anyone with an address.
Do these people have any idea what they are talking about?
"We don't want to see it as a means of payment," Suthiwartnarueput said, adding that cryptos are more of an investment than a medium of exchange.
There is no way cryptocurrencies are an investment, as in spending money to increase productivity. They are a speculative instrument, and possibly a store of value, but no more an investment than keeping your money in your mattress. If they do not work as a medium of exchange I do not see how they could ever have value.
That said, Georgieva noted that digital money can be a "global public good" that can help people send remittances across borders. The key is for interoperability, so that it is just as easy to transfer digital currencies as it is paper-backed currencies like the dollar and euro.
Do these people have any idea what they are talking about?
RobAnybody
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[Bolding mine]I disagree that they aren't an investment. I would agree they aren't a smart investment - a 401k or a Mutual Fund is a smart investment, based on history, but crypto is still an investment - many people made a ton of money off of them. In the same way (& I know I'm repeating myself here) Beanie Babies were an investment at one time. Or baseball cards, or vintage comic books, or... I dunno, gold even.
My disagreement is simply that "speculative instrument"s can certainly be investments. Bad ones, or random ones, but sometimes good ones, too. None of these things have intrinsic value. Collectibles of any sort only go up in value as more people wish to acquire them. Or lose value as people cease to want to buy them. But they are still investments, in that the people buying them hope to make money later by selling them.
My understanding is that investment, as a technical economic term, specifically refers to spending money to increase productivity. A venture capitalist lending money to a startup for some share of the business, so the startup can by more machines, is investing (as well as a speculative instrument). Buying already existing shares from a share holder (as opposed to an IPO or other share issue) is not investing (it is probably both a speculative instrument and a store of value).
RobAnybody
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Oh, my bad then. I was using a different understanding of "investment". And I don't mean in any way mine is right. I was reading/using it in terms of "a means to increase one's personal wealth" - i.e. buying something that you think will increase in value with the intention of selling for more than you bought it for.
I would say that is exactly the definition of a speculative instrument.
