Crypto investing

[Cowboy Brian]

Figured this would make for an interesting thread. How many of you have been investing in cryptocurrencies? What are your thoughts?

The market for cryptos is seemingly displaced from reality. 2 days ago I bought a bunch of a random coin $AMP, its up about ~70% since and I've made ~$700. The entire market seems to be getting pumped up for no reason other than Elon Musk and Snoop Dogg tweeting about it....

 

[Creeper]

I have been mining crypto for about 7 years now I think. I built few rigs maybe for $3500. I saved a few bucks by scavenging some old computers and parts I had. In any case, I have mined all kinds of cryptos, moving from one to another as the markets change. Some crypto coins have failed completely. In fact, many have. I have over the years made back my investment and some profits and I only mine coins that have a positive return after taking out my energy costs.

I have had some big positives and some big negatives. I mined a coin called Amber at one point, which was supposedly backed by real amber mining, but got out before it failed. I mined Diamonds and held as many as 25,000 of them. At the time they were worth a few cents, but recently hit $32. Too bad I sold all mine a long time ago just before Diamond Coins were delisted by the major exchanges. I had come coins stored on Cryptsy when it was suddenly taken down after its owner and founder ripped off the exchange and was indicted for fraud. At the time Bitcoins were worth a few hundred buck so I did not lose much $$ but my Bitcoins I lost would be worth thousands today.

The thing about crypto is it's pure supply and demand. There is nothing backing any of these coins. The price is purely dependent on what people are willing to pay for it. In that sense, all these markets are risky. Anyone can start a coin. People just reuse the technology and make a few simple changes to the configuration and voila! A new coin. The markets for some coins are so small that they are easily manipulated.

My advice is to watch the exchanges for activity on any coins you are considering making an investment. If the activity or daily volume is low, be careful. Coins with low volume trading are candidates for delisting by the exchanges. Like any investment, do your research. Only use the major exchanges and read what people say about them because a few have failed because of fraud and theft and investors lost all of there crypto currencies they stored in the exchange's accounts. Find out who is behind the coin, its history, its growth strategy. I would only invest in established coins, although new coins can be high risk high reward investments. When you see a new coin, check to see if coins are pre-mined and who is awarded the pre-mined coins. Some unscrupulous actors will start a new coin, pre-mine millions of them which they keep and the use the pump and dump scam to make themselves rich. Before long the coin falls off the face of the earth after the founders take their profits and move on to a new scam. No one regulates the crypto markets so all the scams the SEC prevents in stocks are possible in crypto.

While I have been in crypto for a long time, and I have made money on it, I am a full skeptic. I do not invest other than in mining. I think I made one actual purchase of crypto a few years ago.

Remember too, the IRS is watching now. I few years ago crypto was not on their radar. Now you are supposed to report your profits. But being the IRS, they do not allow you to take your mining expenses as deductions against earnings, which is BS. At least I did not see how you can do it when I filed my taxes last year.

I do it for a hobby, not to get rich, although as you know, with growth rates like 70% on some coin, the right investment can net lots of money. Some folks have gotten very rich off of Bitcoins recently when the price went from about $10,000 to $44,000. When I started Bitcoin was around $300.

 

[CyberB0b]

I'm only knowledgeable about BTC. I don't think it has a future as a currency. The model of limited production means it will force people to HODL instead of using it to buy a pizza. This is a fundamental flaw if it is to be viable as a currency. It's also slow as hell when the price is high.

 

[InTheZone]

Crypto is the future. Good job on amp, but I dont even see it on voyager.

 

[Cowboy Brian]

Crypto is the future. Good job on amp, but I dont even see it on voyager.

It's on Gemini

https://coinmarketcap.com/currencies/amp/

 

[Cowboy Brian]

I'm only knowledgeable about BTC. I don't think it has a future as a currency. The model of limited production means it will force people to HODL instead of using it to buy a pizza. This is a fundamental flaw if it is to be viable as a currency. It's also slow as hell when the price is high.

and the cost per transaction is absurd....

I understand the desire for an alternative store of value given the likelihood of significant inflation over the coming years, but BTC seems to be an antiquated technology already. There are other cryptos that are much better at what BTC was designed for.

 

[Creeper]

Crypto is the future. Good job on amp, but I dont even see it on voyager.

For crypto to replace the US dollar or even the Chinese Yuan, a lot has to happen. For one thing, a regulatory body will have to be put in place to reduce the volatility and fraud in the crypto markets. Imagine if the USD was prone to huge value swings of 10% - 20% in a day. No one would want to hold dollars and they would move to more stable currencies. While people do invest in currencies their primary purpose is for trade and that requires stable value. This is the number 1 reason the US dollar is the current world currency preference.

I also believe government would have to embrace crypto, which could happen but I don't think the US would ever replace its dollar with BTC. More likely, the USD will become a cryptocurrency backed by the US government. If this happens, BTC will die a quick death along with all the other existing cryptocurrencies. But honestly, it will be a long time before the US adopts an electronic currency to replace greenbacks.

In an "end of the world" scenario, I would rather be holding gold or silver than BTC, which would be useless.

 

[Reality]

For crypto to replace the US dollar or even the Chinese Yuan, a lot has to happen. For one thing, a regulatory body will have to be put in place to reduce the volatility and fraud in the crypto markets. Imagine if the USD was prone to huge value swings of 10% - 20% in a day. No one would want to hold dollars and they would move to more stable currencies. While people do invest in currencies their primary purpose is for trade and that requires stable value. This is the number 1 reason the US dollar is the current world currency preference.

I also believe government would have to embrace crypto, which could happen but I don't think the US would ever replace its dollar with BTC. More likely, the USD will become a cryptocurrency backed by the US government. If this happens, BTC will die a quick death along with all the other existing cryptocurrencies. But honestly, it will be a long time before the US adopts an electronic currency to replace greenbacks.

In an "end of the world" scenario, I would rather be holding gold or silver than BTC, which would be useless.

This exactly!

The old school tech in me loves the idea of cryptocurrency, but really all it is right now is a "don't get caught holding it last" gambling .. I mean speculation .. game, with the more popular ones like BTC and ETH constantly being manipulated by pump-and-dump large investors to drive up the price.

I regularly see people claiming random cryptocurrencies of the moment will be the "future of global currency", but not without regulations on a global scale. A lot more countries are modernized now and they are not going to settle for one country being in control of a global currency.

Another obstacle, and likely the biggest one, will be trying to convince countries who have complete control over their own globally popular currency to support a global currency they have no control over that is not tied to any country-specific currency.

The problem with bitcoins as @Creeper pointed out is there is a finite number available, which is around 21 million bitcoins if I remember correctly. On top of that, a small group of investors own/control a large amount of bitcoins and a lot of bitcoins have been permanently lost through negligence or theft.

I think the best way for a cryptocurrency to become a true global currency is to gain global support and regulation outside the control of a single country.

I think it will also need to provide an unlimited supply of coins (or whatever) over time with daily quotas of newly added/mined coins added to the pool.

As part of the regulations, I think rules will have to be put in place to prevent any single person or entity from owning too much of the currency at one time (it could scale based on percentage of overall pool of course) or else it will simply result in the same wealth-vs-poverty problems the world is already facing with traditional fiat-based currency.

In other words, the best part of the wild world of cryptocurrency we are seeing right now that everyone loves, being borderless and outside the control of countries (at least perceived), are not likely to be traits a future global cryptocurrency will have unfortunately.

 

[InTheZone]

For crypto to replace the US dollar or even the Chinese Yuan, a lot has to happen. For one thing, a regulatory body will have to be put in place to reduce the volatility and fraud in the crypto markets. Imagine if the USD was prone to huge value swings of 10% - 20% in a day. No one would want to hold dollars and they would move to more stable currencies. While people do invest in currencies their primary purpose is for trade and that requires stable value. This is the number 1 reason the US dollar is the current world currency preference.

I also believe government would have to embrace crypto, which could happen but I don't think the US would ever replace its dollar with BTC. More likely, the USD will become a cryptocurrency backed by the US government. If this happens, BTC will die a quick death along with all the other existing cryptocurrencies. But honestly, it will be a long time before the US adopts an electronic currency to replace greenbacks.

In an "end of the world" scenario, I would rather be holding gold or silver than BTC, which would be useless.

Gold is for the end of the world. Crypto is for the time between now and right before humanity destroys itself (it seems current forces are expediting this process)

 

[nobody]

My problem with it are the miners themselves. Many use and burn out video cards quickly, thus ruining them. It's not like there's unlimited resources on the planet to make them, so it drives up costs and screws the future for a tiny profit today.

 

[Creeper]

This exactly!

The old school tech in me loves the idea of cryptocurrency, but really all it is right now is a "don't get caught holding it last" gambling .. I mean speculation .. game, with the more popular ones like BTC and ETH constantly being manipulated by pump-and-dump large investors to drive up the price.

I regularly see people claiming random cryptocurrencies of the moment will be the "future of global currency", but not without regulations on a global scale. A lot more countries are modernized now and they are not going to settle for one country being in control of a global currency.

Another obstacle, and likely the biggest one, will be trying to convince countries who have complete control over their own globally popular currency to support a global currency they have no control over that is not tied to any country-specific currency.

The problem with bitcoins as @Creeper pointed out is there is a finite number available, which is around 21 million bitcoins if I remember correctly. On top of that, a small group of investors own/control a large amount of bitcoins and a lot of bitcoins have been permanently lost through negligence or theft.

I think the best way for a cryptocurrency to become a true global currency is to gain global support and regulation outside the control of a single country.

I think it will also need to provide an unlimited supply of coins (or whatever) over time with daily quotas of newly added/mined coins added to the pool.

As part of the regulations, I think rules will have to be put in place to prevent any single person or entity from owning too much of the currency at one time (it could scale based on percentage of overall pool of course) or else it will simply result in the same wealth-vs-poverty problems the world is already facing with traditional fiat-based currency.

In other words, the best part of the wild world of cryptocurrency we are seeing right now that everyone loves, being borderless and outside the control of countries (at least perceived), are not likely to be traits a future global cryptocurrency will have unfortunately.

Perhaps some smaller countries with unstable currencies will adopt Bitcoin first because it is more stable than their own currency. I remember the days, not long ago, when South American currencies were inflating in multiples many times a week. A currency like this is worthless. Why accept a peso today that will be worth a 1% of a peso tomorrow? Is this the path to crypto? If the US debt continues to rise and the only way out is printing money, will inflation cause people to flock to Bitcoin and other cryptocurrencies for safety? Sounds bizarre but there is no reason why the US dollar cannot go through inflation like we've seen in other countries. The debt is growing exponentially, and could reach $45 trillion in 10 years. How do you get out of that kind of debt? Printing money. But printing money devalues the currency and causes inflation. Print enough money and we will get hyperinflation where inflation outpaces everything, particularly wages, by a wide margin. Maybe as we approach this point more people invest in Bitcoin, because gold is too expensive or hard to find.

The thing about Bitcoin is you don't have to buy it in any particular denomination. You can buy it in tiny fractions.

Remember when casinos actually had slot machines where you put quarters in and got quarters back when you won?

 

[Creeper]

My problem with it are the miners themselves. Many use and burn out video cards quickly, thus ruining them. It's not like there's unlimited resources on the planet to make them, so it drives up costs and screws the future for a tiny profit today.

I have not had a single card fail on me, other than a few cooling fans which I just replace, in the 7 years I have been mining. Guys who drive their cards too hard and burn them out are not too smart because the cards are very expensive and the cost to replace them is more then the marginal extra profits they get from pushing their cards harder, not to mention the extra power they consume. Also, I sell my older cards at bargain prices to help keep the prices down.

The price of video cards has fluctuated up and down with Bitcoin. I've seen times when video cards were selling for 3 times there original retail value. I have also seen the prices plummet when miners lost interest. Right now video card prices are high again. I would love to expand my mining capabilities but not at these prices. 18 months ago, when prices were down I bought 10 AMD RX570s for $100 each to replace my older video cards that use twice the power. It was worth it back then when prices were depressed but today I would not bother to replace a card if it fails. I know gamers are irked by miners who drive video card prices up, but it's the suppliers doing the price gouging.

By the way, this technology can be recycles and some of the more expensive rare material can be extracted for reuse. We have a tech recycling bin in my town and I always dump all my old circuit boards in there. Every little bit helps.

 

[Creeper]

Gold is for the end of the world. Crypto is for the time between now and right before humanity destroys itself (it seems current forces are expediting this process)

I am afraid lead will be the metal of choice for the end of the world.

 

[Reality]

Perhaps some smaller countries with unstable currencies will adopt Bitcoin first because it is more stable than their own currency.

I think that would be a great idea for small countries to do, but many small countries have other countries they do not like or trust to work with which would create problems. I think that is why some countries are trying to create their own cryptocurrency.

I think Europe would be the best suited to launch a euro-based cryptocurrency as they have several countries already aligned under a single government-like system. Eurocoins?

Printing money. But printing money devalues the currency and causes inflation. Print enough money and we will get hyperinflation where inflation outpaces everything, particularly wages, by a wide margin. Maybe as we approach this point more people invest in Bitcoin, because gold is too expensive or hard to find.

I agree, but as I mentioned in my post, countries with globally popular currencies and/or economies like the US, China, etc. have many ways they can offset inflation caused by printing more money. While those ways do not allow unfettered printing of money, they can definitely soften the blow allowing more flexibility than smaller nations have.

The thing about Bitcoin is you don't have to buy it in any particular denomination. You can buy it in tiny fractions.

True, but fractional bitcoins (satoshis) are just as problematic because their parent (bitcoins) have a finite number which will ultimately trickle down to named fractionals. The US has quarters, dimes, nickels and pennies, but USD is the only thing other countries care about.

Bitcoins are forever tainted at this point though because a few investors own so many and the price is already absurdly high and inflated.

For a cryptocurrency to have a real chance as the future global currency, it will need to have a regularly, yet controlled, growth with an unlimited cap. In addition, it will need to be young and not already heavily owned by any large investors or entities.

Regardless of what happens, it is exciting to see cryptocurrencies grow. That said, most of them, despite the fan hype spam, have no tangible assets or security behind them.

You can make money, but you do not want to be holding on to a cryptocurrency when the big investors cash out or when people start moving to the next great cryptocurrency.

 

[DFWJC]

Figured this would make for an interesting thread. How many of you have been investing in cryptocurrencies? What are your thoughts?

The market for cryptos is seemingly displaced from reality. 2 days ago I bought a bunch of a random coin $AMP, its up about ~70% since and I've made ~$700. The entire market seems to be getting pumped up for no reason other than Elon Musk and Snoop Dogg tweeting about it....

SOS , a crypto mining stock, looks interesting based on valuation vs peers and upcoming operation boost.
Guess we'll see.

 

[SlammedZero]

Interesting/Informative thread.

 

[CalPolyTechnique]

I have been mining crypto for about 7 years now I think. I built few rigs maybe for $3500. I saved a few bucks by scavenging some old computers and parts I had. In any case, I have mined all kinds of cryptos, moving from one to another as the markets change. Some crypto coins have failed completely. In fact, many have. I have over the years made back my investment and some profits and I only mine coins that have a positive return after taking out my energy costs.

I have had some big positives and some big negatives. I mined a coin called Amber at one point, which was supposedly backed by real amber mining, but got out before it failed. I mined Diamonds and held as many as 25,000 of them. At the time they were worth a few cents, but recently hit $32. Too bad I sold all mine a long time ago just before Diamond Coins were delisted by the major exchanges. I had come coins stored on Cryptsy when it was suddenly taken down after its owner and founder ripped off the exchange and was indicted for fraud. At the time Bitcoins were worth a few hundred buck so I did not lose much $$ but my Bitcoins I lost would be worth thousands today.

The thing about crypto is it's pure supply and demand. There is nothing backing any of these coins. The price is purely dependent on what people are willing to pay for it. In that sense, all these markets are risky. Anyone can start a coin. People just reuse the technology and make a few simple changes to the configuration and voila! A new coin. The markets for some coins are so small that they are easily manipulated.

My advice is to watch the exchanges for activity on any coins you are considering making an investment. If the activity or daily volume is low, be careful. Coins with low volume trading are candidates for delisting by the exchanges. Like any investment, do your research. Only use the major exchanges and read what people say about them because a few have failed because of fraud and theft and investors lost all of there crypto currencies they stored in the exchange's accounts. Find out who is behind the coin, its history, its growth strategy. I would only invest in established coins, although new coins can be high risk high reward investments. When you see a new coin, check to see if coins are pre-mined and who is awarded the pre-mined coins. Some unscrupulous actors will start a new coin, pre-mine millions of them which they keep and the use the pump and dump scam to make themselves rich. Before long the coin falls off the face of the earth after the founders take their profits and move on to a new scam. No one regulates the crypto markets so all the scams the SEC prevents in stocks are possible in crypto.

While I have been in crypto for a long time, and I have made money on it, I am a full skeptic. I do not invest other than in mining. I think I made one actual purchase of crypto a few years ago.

Remember too, the IRS is watching now. I few years ago crypto was not on their radar. Now you are supposed to report your profits. But being the IRS, they do not allow you to take your mining expenses as deductions against earnings, which is BS. At least I did not see how you can do it when I filed my taxes last year.

I do it for a hobby, not to get rich, although as you know, with growth rates like 70% on some coin, the right investment can net lots of money. Some folks have gotten very rich off of Bitcoins recently when the price went from about $10,000 to $44,000. When I started Bitcoin was around $300.

Please explain what “mining” in this sense is?

 

[Hardline]

All I know is if I held any bit coin now I would be selling it as fast as possible.

 

[DFWJC]

SOS , a crypto mining stock, looks interesting based on valuation vs peers and upcoming operation boost.
Guess we'll see.

in, in the low to mid 5's


I'm going to go on record saying 200% minimum in next 6 mos

As always, everyone should do their own DD

 

[Ranched]

Cryptocurrencies have an unproven rate of return. You can't predict changes or calculate returns like you can w/growth stock mutual funds. There just isn't enough data, or enough credibility, to create a long term investing plan based in cryptocurrency.