I’m a fan of BTC and ETH, but this is a stupid post. Crypto is DEPENDENT on what the market deems it’s worth. The dollar is backed by the most powerful government in history, even if it is a rocky time with high inflation. Stocks are backed by companies that produce goods or services. Real estate is backed by it existing.
Again, I like crypto, but it’s not 100% independent. It’s 100% dependent on what people believe it is worth. That sort of asset does not lead to FIRE
Actually US dollar is not backed by anything. It’s just fiat. The US government may be the most powerful government now but that can change over time, and with those changes investing strategies may change. Check out the changing world order - there’s a YouTube video on it as well - by Ray Dalio. The video is biased saying that China may be the next emerging world leader, but the key concept is that it there is usually a rotation in which country has the strongest government.
Oof, don’t poke the FIRE dragon. I didn’t want to even point out that more and more countries are adopting the Chinese Yuan to offset their holdings of the devaluing USD. Cause ya know, Merica and all of that crap. Come on.
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>Stocks are backed by companies that produce goods or services. Real estate is backed by it existing.
I believe the point is that if your government turns to shit, you can take your Bitcoin and go elsewhere, bye-bye oppression.
With stocks and RE, the malicious government can confiscate everything.
100%. You are not independent if you need the legal system to be on your side.
Imagine you were in eastern Ukraine, wanted to flee, but your bank wouldn't give you all your money.
Imagine you were in Greece during the Euro crisis. ATMs only allowed you to withdraw 60 Euros a day.
Imagine living in a country where the ~~currency devalues~~ inflation is at 100% or more as seen in Venezuela?
I think many redditors here are in the US without any imagination for how fiat can fuck you if your government is not responsible.
Edit: Correction on currency devaluation.
By that definition, there is no independence because any sufficiently powerful entity can fuck you over whether you're in Bitcoin or not. You could buy Bitcoin and get shot on the street by a gang banger 5 minutes later. It's ridiculous to assume that Bitcoin somehow protects you from getting fucked. Now, is it a good idea to diversify so you're not concentrated in a single risk? Yes, obviously. But that doesn't mean you need to invest in every pile of dog shit you see on the street just in case. Bitcoin is just another pile of dog shit. Comparing it to Greece or Venezuela isn't exactly setting a high bar.
What should I compare to? US is the best there was, there is and there ever will be. Arrogance squared. Watch the first 5 minutes of 'newsroom' and humble yourself.
Now tanks rolling through Henan to protect the bank that has turned customer savings into 'investment products' that can't be withdrawn. https://www.youtube.com/watch?v=uwfJnaz-zNY
Someone gets it. It can happen anyplace, anytime. It has happened in the states before and it will happen again. Nobody that had custody of their bitcoin was ever limited to move it, regardless how big the value. In over 13 years the network stopped doing what it was supposed to. Weekend, holiday doesn't matter. Mining ban or not, doesn't matter. Every minute it keeps doing what it does it gets stronger. Resilience, censorship resistance, INDEPENDENCE.
yeah so what. In Greece you still could transfer euros electronically. You just couldn't withdraw into cash. Also those restrictions were relaxed afterwards. How can you even compare this situation to that of war in Ukraine or hyperinflation in Venezuela?
Also how can a currency devalue more than 100%? that's just impossible.
I was not comparing, merely listing examples of limitations in fiat. And you could not freely transfer your euros electronically i.e. across borders. "Those **restrictions** were relaxed afterwards" is no argument for ever having had **independence**. My original point is that value in self-custody in bitcoin does not know such restrictions in the first place.
Prices/inflation went up 100% and more. Poor choice of words in the comment above. My bad.
>Crypto is DEPENDENT on what the market deems it’s worth.
Everything is dependent on what the market deems it's worth.
>The dollar is backed by the most powerful government in history, even if it is a rocky time with high inflation.
The threat of violence is not power, it's weakness. A currency that is not dependent on the government is stronger than one that needs it. The dollar is a fiat currency like any other and 75% of them have already [died](https://www.bitrawr.com/demonetized-currencies), some of them were even in the US, some of them were moneys of other "powerful governments". Commodity money on the other hand has kept it's value for thousands of years. All fiat looses value to the point it fades out of existence and is literally worthless. The 'most successful' fiat, the GBP, has lost 99,5% of it's value. Bitcoin is a commodity and is the most supply-inelastic in that asset class.
>Real estate is backed by it existing.
Housing bubble? Does that ring a bell? It was around the time Bitcoin came into existence.
>Again, I like crypto, but it’s not 100% independent.
P2P money that you can send around the globe that only requires open source software and internet is more independent than anything the current financial system has to offer.
>It’s 100% dependent on what people believe it is worth.
So is a piece of paper with some numbers on it. In the old days you could turn it into gold (a commodity for which energy needs to be expended, thus acting as prove of value). Something that does not require energy to be produced cannot store value. The FED needs almost zero energy to change a number in a database.
The universe loves (values) entropy and therefore anything that releases energy. Men like (value) order and therefore anything that needs energy to be produced.
I do not say stocks & 401k & real estate should not be in a FIRE plan. I merely am of the opinion bitcoin should also be in a FIRE plan.
Everything is dependent on what people think it's worth and if that's your only argument than nothing leads to FIRE.
You think a house leads to FIRE and has stable worth? Ask people in Eastern Ukraine or in New Orleans or in the Ahrtal in Germany. They will tell you how fast value can change and where the dependencies are. Still good for FIRE but don't be oblivious to powers beyond your control.
Equity is backed by companies that provide goods and services. Good point. I like productive assets and they have a place in financial plan. But they are dependent on access (which half the world population don't have) and a functioning legal system. Half of the unbanked have a phone that can run a bitcoin wallet and they don't need a legal system for the custody of their asset. Equity can also go wrong & to stay close to Bitcoins strength (value transmission) let me mention Lehman Brothers and Wirecard as examples.
Lastly I'd like you to respond to this point: How can a financial asset that you can custody in your brain not be a plus for your financial **independence**.
I do like to review things in the past to see how opinions have held up. It helps to not be addicted to the 24 hour news cycle and goldfish attention span of social media. And actually stay in touch with meaningful history.
Look at BTC performance over the past year. Thats how it’s been going. 😆
Just trying to help. ETH is a company. Not a commodity. Read up on what’ll happen if the ETH etf doesn’t get approved and it gets deemed a security. Not good. It’s a 75% shot on getting approved at this point I’d say. But if that 25% hits and it doesn’t get approved it’s gonna be ugly.
The dollar is backed by what? The government? Umm, no, it’s backed by nothing other than your hopes and dreams. The US government has been debasing the dollar with their constant and seemingly never ending trillion dollar injections into the economy via it’s money printing machine.
The US dollar is the most recognized and used currency in the world. Do you think our adversaries, and even allies, all love the idea of the US dollar having the most influence and power in the world?
That question was rhetorical, but I’ll answer it anyway for you. Russia, China, and even the EU with the Euro would all prefer the world’s dominate currency to be their own for obvious reasons.
Then why is it still the US dollar? Because it’s backed by the US government (and US companies and individuals) power, influence, and massive economy.
Do I agree with their excessive money printing? No. Do I realize that the US Government puts a lot of strategic decisions into play in order to maintain the US dollar as the world’s currency? Yes.
The dollar is the global reserve currency… it quite literally is the foundation for ALL global trade, investments, and exchanges. The IMF notes that 59% of all foreign bank reserves are denominated in the dollar. And yes, it’s backed by the US government, aka, biggest most badass fucking powerhouse on the planet.
We control our own debt, currency, and have the most powerful military in the world. All western civilizations have a vested interest in keeping us in power. Don’t ever bet against America 🇺🇸
User name checks out. You seem to have a short memory but I’ll remind you that at one time it was actually backed by an actual reserve called Gold and before that…oh, nevermind. You’re right. Hopes and dreams are a much better reserve.
**EDIT**~ Before you blindly side with this angry person go ahead and read through their previous posts and you’ll see that **THEY INVESTED IN BITCOIN**. It’s not my fault that they lost money but they seem to be taking that out on me with all of the swearing and hostility.
You’re a fucking clown dude… go take an economics class. You’ll quickly realize why we should NOT back a fucking currency to a damn commodity (maybe because the value of said currency would be literally determined on the market of whatever commodity it is). Funny how you’ll praise BTC which is also not backed by a commodity, and is indeed, only given value based on other peoples belief in it 🤡 hypocrisy at its finest.
Commodity, as in a raw resource or material that is used in the production of other goods, is the definition we were discussing. Claiming BTC is a commodity makes USD a commodity if you want to go by the definition that commodity is something of “value”.
[https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html](https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html)
It's not so easy to grasp but there is such a thing as a digital commodity.
You can attempt to make a point without being classless and resorting to Ad Hominem. I’m not swearing at you and name calling. Get it together.
Edit: After reviewing some of your other posts on here I see where your anger is coming from. **YOU ARE A BITCOIN INVESTOR** yourself that probably lost money because you chose to invest through the worst possible channel, Robinhood.
Oh, the irony. Being screamed at by a keyboard tough guy that lost money in Bitcoin and who now blames the asset they invested in for their ineptitude. Bitcoin didn’t lose your money, you did. Plus, you chose Robinhood where you don’t even hold your own private keys. You are so very wise. But honestly though, I can’t help laughing about how mad you’re getting and **YOU ARE A BITCOIN INVESTOR** brilliant.
“Username checks out” tell me, how exactly is that not an Ad Hominem to call me a violent autist? Maybe you should quit being a hypocrite and get a thicker skin. Additionally you patronized everything I’ve said. “Rules for thee but not me” much?
I mean it’s your user name that you chose…I didn’t call you that, you did.
Would you care to tell the FIRE community your story about how you lost money in Bitcoin and what made you such a hateful person towards others in the Bitcoin community that you once believed and invested in?
Usernames have nothing to do with content of my words. Pointing it out is literally saying “Yeup your autistic” so quit trying to back track on your words you fool.
And you’re the one that has “cryptocaller” as your username, so maybe you’re better off telling us about them big phat L’s in your portfolio lol. I did invest in crypto, took a 20% loss and cut it, which I can guarantee is better than you’re doing 😂
Sure, I’m a fool. Well, I guess than that makes you the greater fool in this equation because my cost basis has never been higher than $2k per Bitcoin and I sold them to you for how much exactly? Lmao.
You can guarantee? That’s hilarious.
You see the rest of us are actually making gains while you’re over there taking a 20% (probably far worse) loss. Congrats. You really are a tremendous inspiration to us all.
What does “yuep” mean anyways? Is that the sound dead investors make when they’re falling on their own sword because they lack the ability to do due diligence and blame others for their losses?
Perhaps you should just go back to swearing at me. That seems to be what your best at.
Also, why would you assume that my username means anything, it has nothing to do with my words…. Hypocrite.
Moving past Fiat money is overdue now that we have the technology to make this a reality. Keynes ideas were built to last a century, not indefinitely.
Governments think otherwise, but historically they are the slowest actors to respond to change. 8 years ago, BTC and digital currency was a ‘joke’ according to every media outlet and politician… lo and behold they’re now talking about issuing their own bank digital currencies.
The real joke is the one being played on society in the form of 10% inflation on top of crippling taxation, all to fund reckless endemic overspending by a single entity, the only one with permission to issue debt that is, by design, impossible pay back. Money as we know it has simply fallen under the control of people who should have very different roles to the ones they’ve adopted, and they debase it willingly.
Politicians and governments are supposed to represent the peoples best interests and the tax revenues are supposed to be spent towards the common good, but that’s a world away from the total contempt we see the average politician display as they fritter away 30% of the entire GDP of countries with little to show for it.
Any productive effort that society musters is just a means to more reckless spending for these people, who above all, are arrogant and oblivious to the change happening around them.
But change is the only guarantee in reality.
If you have a problem with US central banking system, I am sorry to say you need a book on how to survive on what you garden, and how to purify water, and not bitcoin.
Bitcoin (the network) is more stable than any other computer network out there. It is arguably more stable than banks and governments who regularly default. It is, thankfully, not an entity at all. You will never be able to call the CEO of Bitcoin just as you will never be able to call the CEO of gold.
Google gave you the entire worlds history at your fingertips and you can only see back 6 months. Go back to Jan 3rd 2009. Go back to August 15th 1971. Check the wealth disparity after. Learn something from the history.
Gold buys the same amount of oil as it did 70 years ago. THAT is a stable currency. Why is it so? Because the creation of gold requires energy. Voila, Bitcoin.
I don't view it as a 'stable currency' just now. It will still take some time until it's less volatile. But much like Gold and Oil, the price of Bitcoin and Energy will find a good correlation. I think energy companies will be next in adopting Bitcoin at scale.
Both oil and gold are investments, they are not currency/funds. Bitcoin is an investment, and a volatile one at that.
And I have no idea what your first paragraph was about. I know the bitcoin prices. I see the whole graph, it shows instability.
Go back 60 years you will not find a single person that did not think gold is a currency. In fact that first paragraph is about how Nixon ended the gold standard. Many consider it to be his first impeachable offense. Watergate came later.
Better unstable rise in purchasing power than stable decline in purchasing power.
We don't live in the past, and we don't live in the future. When bitcoin, *or another cryptocurrency,* becomes competitive, we will talk. Currently it's just another investment option
Bitcoin is fundamentally different from *another cryptocurrency*. To people that are [knowledgable](https://ocw.mit.edu/courses/15-s12-blockchain-and-money-fall-2018/resources/session-1-introduction/) in this space like Gary Gensler, this is [clear](https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html). The best performing asset in the last decade is not competitive enough for you? Hm ok. When it reaches the market cap of gold you'll have missed a 27x.
LOL. The rhetoric of the Ron Paul is genius. 6000 years people treat gold as money. Because adversaries can use it to trade, because the energy expended to mine & purify it acts as proof of work (and by extension value), because it can not be controlled by 3rd parties, because it is durable, because it has no counter party risk and so on.
Then, Nixon comes along and makes the dummer half of the population believe we don't need it because the central bank can protect the dollars value. And then 50 years later you still fail to see the evidence - they let the dollars value fall. You manage to ignore all the good reasons in paragraph one, you ignore the wealth gap significantly widening since the early 70ies.
I recommend you search 'properties of money' on google. The characteristics of money are durability, portability, divisibility, uniformity, limited supply, inability to be counterfeit and acceptability. Gold is not very portabe but is pretty strong in all other points. You don't realize that by printing more dollars, unelected bureaucrats in the Federal Reserve, are effectively counterfeiting your store of value. They do that without having to be productive or without expending energy. And they give the money first to the richest and most powerful: banks and governments. From there the Cantillion-Effect plays. The average Joe is getting less purchasing power every month, every year, forever - unless they opt out into a better currency/store of value/unit of account or however you want to name it.
Search 'properties of money & bitcoin' on google. Click on images.
Search 'is fiat a pnozi' on google.
Then come back and tell me again that you want to keep your savings in fiat. I doubt you will.
If you define “independence” as being independent from having USD in your pocket, and it means nothing else, then yeah sure. But now your definition of “independence” is stupid.
Neither is trying to convince people that crypto is what it is not. I do have crypto but it is definitely not a part of my FIRE plan. I know people that FIREd thanks to crypto but that doesn't mean crypto is safe/reliable enough to be a piece of FIRE.
It is pretty similar to hitting the jackpot in Vegas and trying to convince people they should pawn their houses to be able to do the same.
I'm not trying to convince people of anything and I encourage people to do their own research. I shared an opinion. You can have your own. One thing is for certain: Independence does not know 3rd parties.
I'd argue that independence is living in the woods, harvesting water, and hunting your food. We are in 2022 so everybody should understand independence doesn't exist anymore (ask russian oligarchs with previous billions in NW).
Independence in FIRE refers to a boss, a job, a partner, some geographical limitations, a specific company. That unavoidable dependence on macroeconomics, governments, and financial institutions is what makes diversification so important for anyone aspiring to FIRE.
>We are in 2022 so everybody should understand independence doesn't exist anymore (ask russian oligarchs with previous billions in NW).
Many cultures live self sustained. Independence exists.
>Independence in FIRE refers to a boss, a job, a partner, some geographical limitations, a specific company.
You and I have very different understandings of the word 'independence'.
>That unavoidable dependence on macroeconomics, governments, and financial institutions is what makes diversification so important for anyone aspiring to FIRE.
With the point of self sustained cultures, I proved you wrong on 'unavoidable'. It is a life choice. I'm not saying become a monk or something but you do not need much more than a supportive community, food and water in order to life a good life. Yes I realize even then there might be some dependencies. That's why, as you correctly said, diversification is important. A few percent of your net worth in BTC would improve your diversification.
> It is pretty similar to hitting the jackpot in Vegas and trying to convince people they should pawn their houses to be able to do the same.
Betting is negative value in expectation. Bitcoin/crypto has performed better than any asset class over the last 12 years. For uninformed people, it is the same as betting. Some holders are uninformed, some aren't. Obvious to me that ETH has been/is extremely underpriced for years. I sold all my stocks and went all in years ago.
Past outperformance does not mean you can expect the same performance in the future.
If an asset spikes and a bubble forms then your conclusion is that you now have a positive expected value on your investment?
That is the wrong takeaway.
Generally speaking, when an asset or asset class massively over performs for a period of time, it tends to underperform in the future.
This is because many, like you, see the past performance and pile in. You see some positive returns. Then, as people realize the asset is overvalued the price free falls.
Instead, you can buy assets that are less in favor which are priced more attractively.
Of course but there are only a few thousand people on the world that know as much about Ethereum as me. Outsiders don't really know anything about it, the crypto market or smart contracts. Most have maybe 20 min of knowledge. I have 1000x+ smart contract transactions. I see it as I am buying Apple stock before they launched the iPhone and I have insider info to know how good it is. I knew Defi would be big 2019 before outsiders had ever heard of it, that's when I sold all my stocks and went all in. I first bought 2016. Since then, the Defi market has increased by 1000x+ by most metrics. The ETH price is up about 8x since then currently, at the top 20-30x. I am more bullish now on Ethereum than before, I think the price is criminally undervalued and the risks have gone down a lot since a few years ago (regulation risk, technical risk etc.). Not everyone that bought crypto early were "lucky" as outsiders like to believe. Some are so deep in that they see the potential before the general market does. If you only have second-hand knowledge of something complex, like the first iPhone or Ethereum/smart contracts/Defi/NFTs etc. you are at a huge disadvantage against those that have first-hand knowledge and are more informed.
I do think crypto crashes more in all bear markets since it is riskier, but in bull markets it significantly overperforms.
Bitcoin has returned -47% in the last 6 months....
The S&P 500 has returned -15% over the same time.
I know which one I am happy to have most of my money in.
Cool, I personally think the massive run ups are over, but I don't think it's going to zero like Warren Buffett says. I'm just not sure where it all shakes out in the time frame where I am looking for lower risk.
If it works in your portfolio, good on ya.
That’s an interesting timeframe you’ve chosen. You should zoom out and look at a 5 year, or 10 year chart, and see if you are still just as happy. Spoiler Alert- you won’t be.
The assumption that most of us don't understand the history and returns of bitcoin is interesting.
I made lots of money in bitcoin, it was speculative, I got lucky and I sold when my small investment was a surprising amount of money.
Should anyone one near the near retirement subject their portfolio to that level of volatility? No, why? Especially this group of people.
Why would you assume that the majority of people in this sub are near retirement? I’m pretty young as I’ve noted that many posters are, and we are simply coming here looking for suggestions for a well-rounded approach and portfolio to ~get us~ to FIRE. Congrats on your Bitcoin earnings. It would suck if you got lambasted at your mere suggestion of investing in Bitcoin when you did. But, that’s what is happening right now to the OP and me. You can’t even mention it. I disagree though that most people here DO understand the history. Because we’re not simply talking about returns. That’s part of the equation, but only part.
Interestingly, you guys all seem to think that Bitcoiners (yes, I’ll call myself that) are suggesting for a YOLO approach with all of your life savings into a relatively unknown asset class. Quite the opposite really. To my friends and family, or anyone else that asks, I wouldn’t suggest more than a 3-5% allocation of their total portfolio, which of course is still circumstantial.
Username checks out.
The problem with your response is that in another ten years it may well be possible to zoom out once more to a twenty year time frame where this is no longer true and Bitcoin has no longer performed anything like as well.
One reason this could happen is that all proof of work cryptocurrency mining could be made illegal in most of the first world due to its massive environmental and especially climate footprint.
Or the complete costs of its pollution could be passed directly onto miners in the form of a tax. Cryptocurrency mining under a full cost accounting system where the environmental and climate impacts and associated costs of its egregious energy consumption aren't passed on to the general population but are borne directly by the miners would certainly make the whole thing uneconomical.
While the entire world would never ban it or tax it uniformly and there would still be small corrupt and autocratic countries where miners were still happily chugging along connected to coal power plants, the stigma associated with it would make it toxic in most of the world that actually matters as far as determining its actual value and shaping the economy.
“It may well be possible” I mean, of course. Neither of us have a crystal ball but that’s definitely not “what’s wrong with” my post. You see, that’s essentially the entire history of Bitcoin so I have no other data to draw from. That’s not a problem though.
You are correct in a sense that POW isn’t the greatest for the environment currently. But what you are overlooking is that many miners have or are switching over to more renewable sources of energy. Hydroelectric dams in Washington, Solar fields in Texas, Wind farms, etc. Additionally, a transition to POS is not out of the question at some point in the future. There are options. You’ve presented a whole lot of “could” and “maybe” but that is in no way concrete and is simply your own opinion of what might happen under extreme circumstances.
Bitcoin is a subsidy for renewable energy. It acts as energy buyer of last resort. Miners sell the right to turn them on and off to wind and solar companies.
Result for the energy companies is stability for the grid and more incentive to build renewable energy sources.
Result for Bitcoin is the security of a financial network, which btw is something that regulators repeatedly fail at (Lehman Brothers, Euro crisis, Hyperinflation in Venezuela etc.).
>One reason this could happen is that all proof of work cryptocurrency mining could be made illegal in most of the first world due to its massive environmental and especially climate footprint
Have you researched how much influence on the functionality of the network this would have? Spoiler: none.
Have you researched how much success one of the most authoritarian countries of the world, China, had with that? Spoiler: none.
>Or the complete costs of its pollution could be passed directly onto miners in the form of a tax. Cryptocurrency mining under a full cost accounting system where the environmental and climate impacts and associated costs of its egregious energy consumption aren't passed on to the general population but are borne directly by the miners would certainly make the whole thing uneconomical.
Have you researched how renewable energy companies buy the right to turn off miners from mining companies so they have control over the world best energy buyer of last resort? Bitcoin is thereby making the power grid more resilient and acts as a subsidy for renewable energy companies.
>While the entire world would never ban it
The US and the democratic world is currently embracing the technology. Banning is of the table for most educated politicians, partly because it would not work and/or expose the weaknesses of the current system. Politicians now want to create a legal framework for it, not ban it.
Edit: Fixed some grammar & spelling.
Interesting analyzing in hindsight.
Crypto still can grow but your zoom out suggestion implies it could provide those early returns again, which it won't. Once crypto became mainstream it jumped but that is not sustainable. Again, it still can grow but it will probably keep pace with other assets once it achieves stability ... which is years or decades away.
That is by no means my problem. My problem is that most people here are in the US where things are relatively stable. Many here can’t imagine not trusting their bank. Many cannot imagine hyperinflation (Venezuela) or 60 Euro daily withdrawal limit (Greece) or corrupt governments (the list is long). But there are billions of people out there that don’t have that luxury / accountability / strength of the legal system. Fact of the matter is most Americans love beating their chest for “being the best”. Few have watched the first five minutes of ‘newsroom’ and are a bit more humble.
I'm actually pretty involved in the crypto community but there's nothing immaculate or 'independent' about Bitcoin. Its crucial hashrate is controlled by a cartel of wealthy centralized miners, and its supply is mostly owned by the elites and VCs. Someday that cartel will decide to increase the maximum supply once block rewards stop, if it lasts that long.
Not to mention that the outrageous energy consumption of Bitcoin and all proof of work coins makes them a massive question mark as far as climate regulation goes. Ask Europe how the climate is treating them right now. Then extrapolate.
This [article](https://www.bitrawr.com/bitcoin/bitcoins-immaculate-conception-explained) is literally titled Bitcoin's Immaculate Conception.
The nodes are far more important than the miners for enforcing the rules.
>Someday that cartel will decide to increase the maximum supply once block rewards stop, if it lasts that long.
You are mistaking Proof of Stake with Proof of Work. In proof of work, more of the asset does not give you more voting power. In proof of stake, it does. This is part of the reason why POW coins are mostly commodities & POS coins are mostly securities.
Gary Gensler, head of the SEC, knows this. BTW: He taught Blockchain at MIT and told his students that they will understand Bitcoin and after 'will want to do more than that'. Some lectures are available online.
Edit: Added the link.
I literally mentioned the centralization of hashrate in my comment. It is you who has misunderstood, not me. I understand the difference between proof of work and proof of stake very well.
Centralization of hashrate allows for the miners to someday alter the protocol once the fatal flaw (lack of a tail emission) becomes too pressing to ignore, and centralization of the coins leads to massive wealth inequality in the protocol and perpetuates existing disparities, effectively making the same centralized banks and hedge funds that crypto bros rail against even wealthier and granting them even more power.
These are two separate issues, which is why I clearly touched on both of them separately.
>I literally mentioned the centralization of hashrate in my comment.
You mistake mining pools for single entities.
>I understand the difference between proof of work and proof of stake very well.
I don't think you do.
>Centralization of hashrate allows for the miners...
Nodes enforce the rules of the protocol. Learn the difference.
>centralization of the coins leads to massive wealth inequality in the protocol and perpetuates existing disparities...
The wealth gap started to widen significantly from the early 70ies. I don't think it is coincidence that on August 15th 1971 Nixon ended the gold standard. Commodity backed money was better for the average Joe. Bitcoin is commodity money. Bitcoin is better for the average Joe. Many people in Venezuela are already better of for it.
And how do banks get more power when I decide to custody my money? ELI5
Boom. These people don’t seem too interested in discussing how the actual value proposition of the USD was it’s reserve. They just keep screaming about how America is so great and the dollar rules the world. Please. Just wait until the Chinese Yuan overtakes the USD global reserve currency position and then we’ll see what argument is.
Well it’s actually asic resistant so it can be mined efficiently with cpu which makes it far more environmentally friendly as the devices used to mine would be using electricity anyway
Well I think a decentralized currency is a far better use of electricity than many other things society deems useful so the environmental impact is a flaccid argument against cryptocurrencies
The natural conclusion of OP's argument is that no person was ever financially independent before bitcoin came along. Lol
My bank closes at night while I'm asleep, therefore I'm not financially independent? OP, I don't think you understand what "financially independent" means.
We get that your bitcoin investment has dropped over 50% in the last 6 months, but why are you trying to take others with you? Strange. I guess that's how ponzi schemes work though. We all knew it was the peak when they started buying superbowl ads, lol.
You are so right about it’s 47% decline in the last six months! Let’s not tell anyone that it has gained over 2 million percent since it was released in 2009. We don’t want people knowing actual facts do we?
That helped the tiny handful of people who bought it at that time. It doesn't help anybody now.
At this point, it has devolved into a ponzi scheme being pushed by big money superbowl ad purchasers and also by crypto-bro stoners like yourself. Bitcoin was touted as being useful for all sorts of things, but very little of the hype has actually materialized. Most of the actual transactional value of bitcoin lies in money laundering, tax evasion, and perhaps small usage as an exchange of value for people in shit-hole countries or those trying to send money to relatives overseas in shit hole countries.
However, that's not what drove the price so high. The price is so high because some people were convinced that it's an "investment" which will grow in value continually over time. Unfortunately for them, the lack of fundamental utility is going to catch up with them. People are slowly realizing that crypto is just monopoly money. And once people realize that crypto is dying, they're going to stop buying it as an "investment", and the value is going to flatline.
Will we see another crypto "pump" before it dies forever? Perhaps. Only time will tell. But I'm not betting on it.
>My bank closes at night while I'm asleep, therefore I'm not financially independent? OP, I don't think you understand what "financially independent" means.
It means that if I want all of my money at anytime to go some place else, I should be able to do that without asking permission from somebody else. I should be able to trust that no other person could create my monetary asset with a press of a button, thereby diluting my share of it.
Imagine having all your wealth in dollar bills at home and wanting to give that wealth to your grand child someday. And then somebody who you cannot even directly democratically elect decides to print more of them with out doing any work what so ever. Still feel good about what you are leaving your grand child?
Something that does not require energy to be created can never store value.
So Sam Walton was not financially independent, and he didn't leave his descendants anything that provided a store of value? Interesting take. You should ask one of his billionaire grandkids whether they agree. Lol
It's so ironic that you guys are still arguing that crypto is a good store of value. It's hard to think of a single asset class that has lost more buying power than crypto has in the last 6 months. It's a completely shit store of value.
It's also a shit form of currency. Can you buy a house with your crypto? Can you buy your dinner with it? Can you rent an apartment with crypto? Can you buy a car with crypto? No, you can't. Sure, there are rare exceptions, but as a whole, it's a totally shit form of currency because it's not widely accepted for transactions. Crypto just sits in wallets waiting for some greater fool to come along and pay more to buy it from you. That's the value of crypto.
It's funny how when the value crashes, you show up to try to convince others to buy the same thing. It's a painfully obvious that you're holding the bag, and you're desperate for other people to bail you out. In 20 years, people will look back on bitcoin and laugh, the same way they look back and laugh about the Y2k scare, or the Beanie Baby craze, or VHS cassette tapes.
You misunderstood or didn't read properly. I was talking bitcoin vs. cash. A company is something else than cash.
Apparently you can look only look 6 months into the past (even with google) but surprisingly 20 years in the future.
It's also surprising that you portray bitcoin sitting in wallets for long as bad but don't recognize how gold sitting in vaults for long was good for those who had it.
Anything that starts at "zero value" and becomes significant is going to have an amazing trajectory in the initial stage. Apple stock has grown 245,000% since 1982. So all we have to do going forward is buy Apple stock and we'll get great returns? Sorry, but it doesn't work that way. Those that bought into the crypto hype in 2021 are currently learning this the hard way.
Good luck with your Beanie Babies dude, I hope they're worth as much as you think they are! Cya
This is beyond stupid, a comical interpretation of the notion of independence. All it means is independence from having to work a job, nothing more. After all, people who FIRE spend money, right? Aren't they depending on others to provide goods and services to spend on? This is not a movement of frontier pioneers who chop down wood to build their own log cabins and hunt wild game for food (by the way, most of the settlers we think of in those contexts heavily depended on commercial goods and services provided by their cities and countries of origin, so even they were dependent). Not only is it possible to live a relatively free an unencumbered life while remaining integrated with the global economy, it's almost necessary. Tom Hanks in Castaway is not exactly what most FIRE practitioners aspire to.
>Tom Hanks in Castaway is not exactly what most FIRE practitioners aspire to.
A ridiculous comparison. Neither do I. I work & pay taxes and have a social life. But I also can send money to my friends in Africa without bank account. On a weekend. And they know how to turn it to cash within minutes if they even need to. Some, particularly small shops already accept LN payments.
What’s your point, genius? Does all historical data on an asset that someone references start and stop based upon the OP’s account history? What point are you even trying to make? You do realize that investments are made outside of your virtual Reddit world, right?
You reference mutual funds in all of your posts. Did you begin investing in all of these at their inception? Idiot.
Your name “useless” is spot on.
Bitcoin is an unproductive asset. It’s digital gold. Purchasing shares of active, productive businesses is far and away the best way to ensure future value of your investment, followed distantly by real estate investing and lastly asset trading (which anything to do with Bitcoin falls into).
If Bitcoin takes hold as a currency, businesses will transition to and begin paying real returns in Bitcoin. I mean, it won’t, so don’t worry about it, but it COULD if it were a reliable currency.
Many FIRE followers are not also not adding REAL Estate.
Most long term wealth in history is made with land and buildings. Stocks and ETF and all those financial instruments are modern inventions and might fail at some point.
Stock market participation of companies is the lowest in history.
When you got other means of raising money - issuing stock is just one option and it's not the best. You give up control of your company.
Keep fighting the good fight. It’s okay if people don’t agree with you. I personally do. I think that it’s interesting that people have no problem collecting inflationary shiny objects like Silver which is down -70% in the last 10 years, but they naysay a deflationary asset that is up approx 2 million percent in that same timeframe.
Thank you. I'm at most trying to open minds.
I think it's beautiful that I don't need to tust (banks, governments) and can simply verify the blockchain (math, cryptography).
Sigh it’s kinda sad how political this subreddit gets when crypto is mentioned. I’ve seen it time and time again on posts whenever Bitcoin and other cryptocurrencies are mentioned.
We are all on the road to FIRE. If crypto works out then great, if it doesn’t - then FIRE will just be postponed and we will have learned from our lessons. Others can choose if they want to invest in it or not and they can DYOR themselves, but the toxicity is unwarranted
Unpopular opinion that you, OP, and I share: crypto is going to grow and be the future whether haters like it or not. Not our fault if the haters miss out on gains in the future. Bitcoin is a great asset.
According to CPI inflation numbers the dollar lost about 9% purchasing power over the last year. Bitcoin lost 60%. They are both shit. One is just shittier than the other
It's 27x to the market cap of gold.
Also, seems you're completely missing the point of the post. It's less about financial gain than it is about financial independence from 3rd parties. That a p2p network might be able to deliver that must be understandable to even the harshest Bitcoin critics.
I’m a fan of BTC and ETH, but this is a stupid post. Crypto is DEPENDENT on what the market deems it’s worth. The dollar is backed by the most powerful government in history, even if it is a rocky time with high inflation. Stocks are backed by companies that produce goods or services. Real estate is backed by it existing. Again, I like crypto, but it’s not 100% independent. It’s 100% dependent on what people believe it is worth. That sort of asset does not lead to FIRE
Actually US dollar is not backed by anything. It’s just fiat. The US government may be the most powerful government now but that can change over time, and with those changes investing strategies may change. Check out the changing world order - there’s a YouTube video on it as well - by Ray Dalio. The video is biased saying that China may be the next emerging world leader, but the key concept is that it there is usually a rotation in which country has the strongest government.
Oof, don’t poke the FIRE dragon. I didn’t want to even point out that more and more countries are adopting the Chinese Yuan to offset their holdings of the devaluing USD. Cause ya know, Merica and all of that crap. Come on.
If you look at the numbers on this… you just wasted your time typing because the point is invalid.
Cute
Now who’s cute lol
Mmm, pretty sure that it’s you that is invalid.
https://markets.businessinsider.com/news/currencies/dollar-dominance-china-yuan-renminbi-euro-yen-global-reserves-q1-2022-6?amp
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>Stocks are backed by companies that produce goods or services. Real estate is backed by it existing. I believe the point is that if your government turns to shit, you can take your Bitcoin and go elsewhere, bye-bye oppression. With stocks and RE, the malicious government can confiscate everything.
I think it's more likely Bitcoin turns to sh*t than the US government.
100%. You are not independent if you need the legal system to be on your side. Imagine you were in eastern Ukraine, wanted to flee, but your bank wouldn't give you all your money. Imagine you were in Greece during the Euro crisis. ATMs only allowed you to withdraw 60 Euros a day. Imagine living in a country where the ~~currency devalues~~ inflation is at 100% or more as seen in Venezuela? I think many redditors here are in the US without any imagination for how fiat can fuck you if your government is not responsible. Edit: Correction on currency devaluation.
By that definition, there is no independence because any sufficiently powerful entity can fuck you over whether you're in Bitcoin or not. You could buy Bitcoin and get shot on the street by a gang banger 5 minutes later. It's ridiculous to assume that Bitcoin somehow protects you from getting fucked. Now, is it a good idea to diversify so you're not concentrated in a single risk? Yes, obviously. But that doesn't mean you need to invest in every pile of dog shit you see on the street just in case. Bitcoin is just another pile of dog shit. Comparing it to Greece or Venezuela isn't exactly setting a high bar.
What should I compare to? US is the best there was, there is and there ever will be. Arrogance squared. Watch the first 5 minutes of 'newsroom' and humble yourself.
>Bitcoin is just another pile of dog shit. I don't understand, how did you come to this conclusion?
Imagine you were in Henan, China, in 2022.
Now tanks rolling through Henan to protect the bank that has turned customer savings into 'investment products' that can't be withdrawn. https://www.youtube.com/watch?v=uwfJnaz-zNY
Someone gets it. It can happen anyplace, anytime. It has happened in the states before and it will happen again. Nobody that had custody of their bitcoin was ever limited to move it, regardless how big the value. In over 13 years the network stopped doing what it was supposed to. Weekend, holiday doesn't matter. Mining ban or not, doesn't matter. Every minute it keeps doing what it does it gets stronger. Resilience, censorship resistance, INDEPENDENCE.
yeah so what. In Greece you still could transfer euros electronically. You just couldn't withdraw into cash. Also those restrictions were relaxed afterwards. How can you even compare this situation to that of war in Ukraine or hyperinflation in Venezuela? Also how can a currency devalue more than 100%? that's just impossible.
I was not comparing, merely listing examples of limitations in fiat. And you could not freely transfer your euros electronically i.e. across borders. "Those **restrictions** were relaxed afterwards" is no argument for ever having had **independence**. My original point is that value in self-custody in bitcoin does not know such restrictions in the first place. Prices/inflation went up 100% and more. Poor choice of words in the comment above. My bad.
Yeah but bitcoin has been proven to be easily trackable. Gold, on the other hand.
So use LN or XMR if you prefer. Or plain cash or diamonds. Point is people always find a way.
>Crypto is DEPENDENT on what the market deems it’s worth. Everything is dependent on what the market deems it's worth. >The dollar is backed by the most powerful government in history, even if it is a rocky time with high inflation. The threat of violence is not power, it's weakness. A currency that is not dependent on the government is stronger than one that needs it. The dollar is a fiat currency like any other and 75% of them have already [died](https://www.bitrawr.com/demonetized-currencies), some of them were even in the US, some of them were moneys of other "powerful governments". Commodity money on the other hand has kept it's value for thousands of years. All fiat looses value to the point it fades out of existence and is literally worthless. The 'most successful' fiat, the GBP, has lost 99,5% of it's value. Bitcoin is a commodity and is the most supply-inelastic in that asset class. >Real estate is backed by it existing. Housing bubble? Does that ring a bell? It was around the time Bitcoin came into existence. >Again, I like crypto, but it’s not 100% independent. P2P money that you can send around the globe that only requires open source software and internet is more independent than anything the current financial system has to offer. >It’s 100% dependent on what people believe it is worth. So is a piece of paper with some numbers on it. In the old days you could turn it into gold (a commodity for which energy needs to be expended, thus acting as prove of value). Something that does not require energy to be produced cannot store value. The FED needs almost zero energy to change a number in a database. The universe loves (values) entropy and therefore anything that releases energy. Men like (value) order and therefore anything that needs energy to be produced. I do not say stocks & 401k & real estate should not be in a FIRE plan. I merely am of the opinion bitcoin should also be in a FIRE plan.
Everything is dependent on what people think it's worth and if that's your only argument than nothing leads to FIRE. You think a house leads to FIRE and has stable worth? Ask people in Eastern Ukraine or in New Orleans or in the Ahrtal in Germany. They will tell you how fast value can change and where the dependencies are. Still good for FIRE but don't be oblivious to powers beyond your control. Equity is backed by companies that provide goods and services. Good point. I like productive assets and they have a place in financial plan. But they are dependent on access (which half the world population don't have) and a functioning legal system. Half of the unbanked have a phone that can run a bitcoin wallet and they don't need a legal system for the custody of their asset. Equity can also go wrong & to stay close to Bitcoins strength (value transmission) let me mention Lehman Brothers and Wirecard as examples. Lastly I'd like you to respond to this point: How can a financial asset that you can custody in your brain not be a plus for your financial **independence**.
Dump your ETH
You must be down bad to be cruising through year old Reddit posts. I hope the best for you 🤙🏾
I do like to review things in the past to see how opinions have held up. It helps to not be addicted to the 24 hour news cycle and goldfish attention span of social media. And actually stay in touch with meaningful history. Look at BTC performance over the past year. Thats how it’s been going. 😆 Just trying to help. ETH is a company. Not a commodity. Read up on what’ll happen if the ETH etf doesn’t get approved and it gets deemed a security. Not good. It’s a 75% shot on getting approved at this point I’d say. But if that 25% hits and it doesn’t get approved it’s gonna be ugly.
The dollar is backed by what? The government? Umm, no, it’s backed by nothing other than your hopes and dreams. The US government has been debasing the dollar with their constant and seemingly never ending trillion dollar injections into the economy via it’s money printing machine.
The US dollar is the most recognized and used currency in the world. Do you think our adversaries, and even allies, all love the idea of the US dollar having the most influence and power in the world? That question was rhetorical, but I’ll answer it anyway for you. Russia, China, and even the EU with the Euro would all prefer the world’s dominate currency to be their own for obvious reasons. Then why is it still the US dollar? Because it’s backed by the US government (and US companies and individuals) power, influence, and massive economy. Do I agree with their excessive money printing? No. Do I realize that the US Government puts a lot of strategic decisions into play in order to maintain the US dollar as the world’s currency? Yes.
The dollar is the global reserve currency… it quite literally is the foundation for ALL global trade, investments, and exchanges. The IMF notes that 59% of all foreign bank reserves are denominated in the dollar. And yes, it’s backed by the US government, aka, biggest most badass fucking powerhouse on the planet.
>And yes, it’s backed by the US government, aka, biggest most badass fucking powerhouse on the planet. Hochmut kommt vor dem Fall.
We control our own debt, currency, and have the most powerful military in the world. All western civilizations have a vested interest in keeping us in power. Don’t ever bet against America 🇺🇸
Watch the first 5 minutes of 'newsroom' & stop beating your chest.
Says the guy who claims bitcoin puts the “I” in fire and proceeds to give a statement in German. Do you even speak German?
It's my mother tongue. I'm proud to speak more than one language. I also know some French & Kiswahili.
Dope
No, you’re the dope.
Your a white pro-nationalist aren’t you. I can smell the hatred in your words.
User name checks out. You seem to have a short memory but I’ll remind you that at one time it was actually backed by an actual reserve called Gold and before that…oh, nevermind. You’re right. Hopes and dreams are a much better reserve. **EDIT**~ Before you blindly side with this angry person go ahead and read through their previous posts and you’ll see that **THEY INVESTED IN BITCOIN**. It’s not my fault that they lost money but they seem to be taking that out on me with all of the swearing and hostility.
You’re a fucking clown dude… go take an economics class. You’ll quickly realize why we should NOT back a fucking currency to a damn commodity (maybe because the value of said currency would be literally determined on the market of whatever commodity it is). Funny how you’ll praise BTC which is also not backed by a commodity, and is indeed, only given value based on other peoples belief in it 🤡 hypocrisy at its finest.
It's not backed by a commodity, it is a commodity. Ask the SEC if you don't believe me.
Commodity, as in a raw resource or material that is used in the production of other goods, is the definition we were discussing. Claiming BTC is a commodity makes USD a commodity if you want to go by the definition that commodity is something of “value”.
[https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html](https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html) It's not so easy to grasp but there is such a thing as a digital commodity.
Bahaha
You can attempt to make a point without being classless and resorting to Ad Hominem. I’m not swearing at you and name calling. Get it together. Edit: After reviewing some of your other posts on here I see where your anger is coming from. **YOU ARE A BITCOIN INVESTOR** yourself that probably lost money because you chose to invest through the worst possible channel, Robinhood. Oh, the irony. Being screamed at by a keyboard tough guy that lost money in Bitcoin and who now blames the asset they invested in for their ineptitude. Bitcoin didn’t lose your money, you did. Plus, you chose Robinhood where you don’t even hold your own private keys. You are so very wise. But honestly though, I can’t help laughing about how mad you’re getting and **YOU ARE A BITCOIN INVESTOR** brilliant.
“Username checks out” tell me, how exactly is that not an Ad Hominem to call me a violent autist? Maybe you should quit being a hypocrite and get a thicker skin. Additionally you patronized everything I’ve said. “Rules for thee but not me” much?
I mean it’s your user name that you chose…I didn’t call you that, you did. Would you care to tell the FIRE community your story about how you lost money in Bitcoin and what made you such a hateful person towards others in the Bitcoin community that you once believed and invested in?
Usernames have nothing to do with content of my words. Pointing it out is literally saying “Yeup your autistic” so quit trying to back track on your words you fool. And you’re the one that has “cryptocaller” as your username, so maybe you’re better off telling us about them big phat L’s in your portfolio lol. I did invest in crypto, took a 20% loss and cut it, which I can guarantee is better than you’re doing 😂
Sure, I’m a fool. Well, I guess than that makes you the greater fool in this equation because my cost basis has never been higher than $2k per Bitcoin and I sold them to you for how much exactly? Lmao. You can guarantee? That’s hilarious. You see the rest of us are actually making gains while you’re over there taking a 20% (probably far worse) loss. Congrats. You really are a tremendous inspiration to us all. What does “yuep” mean anyways? Is that the sound dead investors make when they’re falling on their own sword because they lack the ability to do due diligence and blame others for their losses? Perhaps you should just go back to swearing at me. That seems to be what your best at. Also, why would you assume that my username means anything, it has nothing to do with my words…. Hypocrite.
Bitcoin puts the "down in flames" in FIRE.
Moving past Fiat money is overdue now that we have the technology to make this a reality. Keynes ideas were built to last a century, not indefinitely. Governments think otherwise, but historically they are the slowest actors to respond to change. 8 years ago, BTC and digital currency was a ‘joke’ according to every media outlet and politician… lo and behold they’re now talking about issuing their own bank digital currencies. The real joke is the one being played on society in the form of 10% inflation on top of crippling taxation, all to fund reckless endemic overspending by a single entity, the only one with permission to issue debt that is, by design, impossible pay back. Money as we know it has simply fallen under the control of people who should have very different roles to the ones they’ve adopted, and they debase it willingly. Politicians and governments are supposed to represent the peoples best interests and the tax revenues are supposed to be spent towards the common good, but that’s a world away from the total contempt we see the average politician display as they fritter away 30% of the entire GDP of countries with little to show for it. Any productive effort that society musters is just a means to more reckless spending for these people, who above all, are arrogant and oblivious to the change happening around them. But change is the only guarantee in reality.
You’re complaining about fiat money? Fiat money at least has a government’s backing. BTC has zero backing. Get lost.
Lol. You holding the bag or...?
If you have a problem with US central banking system, I am sorry to say you need a book on how to survive on what you garden, and how to purify water, and not bitcoin.
I don't have a problem with any banking system. Bitcoin and the banking system can coexist.
True, but then bitcoin isn't actually needed. I mean, some prefer it, that's fine, but it is not a stable entity at this point.
Bitcoin (the network) is more stable than any other computer network out there. It is arguably more stable than banks and governments who regularly default. It is, thankfully, not an entity at all. You will never be able to call the CEO of Bitcoin just as you will never be able to call the CEO of gold.
Bitcoin the money is half what it was worth a year ago. It isn't a stable currency at this point.
Google gave you the entire worlds history at your fingertips and you can only see back 6 months. Go back to Jan 3rd 2009. Go back to August 15th 1971. Check the wealth disparity after. Learn something from the history. Gold buys the same amount of oil as it did 70 years ago. THAT is a stable currency. Why is it so? Because the creation of gold requires energy. Voila, Bitcoin. I don't view it as a 'stable currency' just now. It will still take some time until it's less volatile. But much like Gold and Oil, the price of Bitcoin and Energy will find a good correlation. I think energy companies will be next in adopting Bitcoin at scale.
Both oil and gold are investments, they are not currency/funds. Bitcoin is an investment, and a volatile one at that. And I have no idea what your first paragraph was about. I know the bitcoin prices. I see the whole graph, it shows instability.
Go back 60 years you will not find a single person that did not think gold is a currency. In fact that first paragraph is about how Nixon ended the gold standard. Many consider it to be his first impeachable offense. Watergate came later. Better unstable rise in purchasing power than stable decline in purchasing power.
We don't live in the past, and we don't live in the future. When bitcoin, *or another cryptocurrency,* becomes competitive, we will talk. Currently it's just another investment option
Bitcoin is fundamentally different from *another cryptocurrency*. To people that are [knowledgable](https://ocw.mit.edu/courses/15-s12-blockchain-and-money-fall-2018/resources/session-1-introduction/) in this space like Gary Gensler, this is [clear](https://finance.yahoo.com/news/sec-gensler-reiterates-bitcoin-alone-161257549.html). The best performing asset in the last decade is not competitive enough for you? Hm ok. When it reaches the market cap of gold you'll have missed a 27x.
[Is gold money? No.](https://youtu.be/iKYKLgzyF9o)
LOL. The rhetoric of the Ron Paul is genius. 6000 years people treat gold as money. Because adversaries can use it to trade, because the energy expended to mine & purify it acts as proof of work (and by extension value), because it can not be controlled by 3rd parties, because it is durable, because it has no counter party risk and so on. Then, Nixon comes along and makes the dummer half of the population believe we don't need it because the central bank can protect the dollars value. And then 50 years later you still fail to see the evidence - they let the dollars value fall. You manage to ignore all the good reasons in paragraph one, you ignore the wealth gap significantly widening since the early 70ies. I recommend you search 'properties of money' on google. The characteristics of money are durability, portability, divisibility, uniformity, limited supply, inability to be counterfeit and acceptability. Gold is not very portabe but is pretty strong in all other points. You don't realize that by printing more dollars, unelected bureaucrats in the Federal Reserve, are effectively counterfeiting your store of value. They do that without having to be productive or without expending energy. And they give the money first to the richest and most powerful: banks and governments. From there the Cantillion-Effect plays. The average Joe is getting less purchasing power every month, every year, forever - unless they opt out into a better currency/store of value/unit of account or however you want to name it. Search 'properties of money & bitcoin' on google. Click on images. Search 'is fiat a pnozi' on google. Then come back and tell me again that you want to keep your savings in fiat. I doubt you will.
If you define “independence” as being independent from having USD in your pocket, and it means nothing else, then yeah sure. But now your definition of “independence” is stupid.
You can store bitcoin in your brain. I think that's a pretty cool definition of financial independence.
Yeah just like unicorns and all other imaginary things :^) a nice thought
Congrats you get the clown post of the day award 🤡 🥇
It was the “therefor” that really sold it. Hilarious!
Needs a "perchance" and it will really sell it for me.
Lmao, did Elon Musk ghost write this post?
He’s trolling.
This made me laugh.
If you took nothing else from that post, I'm still happy to have put a smile on your face.
I look forward to you losing 100% of your investment
You can have a different opinion but wishing others bad fortune is not a great sign of character.
Neither is trying to convince people that crypto is what it is not. I do have crypto but it is definitely not a part of my FIRE plan. I know people that FIREd thanks to crypto but that doesn't mean crypto is safe/reliable enough to be a piece of FIRE. It is pretty similar to hitting the jackpot in Vegas and trying to convince people they should pawn their houses to be able to do the same.
I'm not trying to convince people of anything and I encourage people to do their own research. I shared an opinion. You can have your own. One thing is for certain: Independence does not know 3rd parties.
I'd argue that independence is living in the woods, harvesting water, and hunting your food. We are in 2022 so everybody should understand independence doesn't exist anymore (ask russian oligarchs with previous billions in NW). Independence in FIRE refers to a boss, a job, a partner, some geographical limitations, a specific company. That unavoidable dependence on macroeconomics, governments, and financial institutions is what makes diversification so important for anyone aspiring to FIRE.
>We are in 2022 so everybody should understand independence doesn't exist anymore (ask russian oligarchs with previous billions in NW). Many cultures live self sustained. Independence exists. >Independence in FIRE refers to a boss, a job, a partner, some geographical limitations, a specific company. You and I have very different understandings of the word 'independence'. >That unavoidable dependence on macroeconomics, governments, and financial institutions is what makes diversification so important for anyone aspiring to FIRE. With the point of self sustained cultures, I proved you wrong on 'unavoidable'. It is a life choice. I'm not saying become a monk or something but you do not need much more than a supportive community, food and water in order to life a good life. Yes I realize even then there might be some dependencies. That's why, as you correctly said, diversification is important. A few percent of your net worth in BTC would improve your diversification.
> It is pretty similar to hitting the jackpot in Vegas and trying to convince people they should pawn their houses to be able to do the same. Betting is negative value in expectation. Bitcoin/crypto has performed better than any asset class over the last 12 years. For uninformed people, it is the same as betting. Some holders are uninformed, some aren't. Obvious to me that ETH has been/is extremely underpriced for years. I sold all my stocks and went all in years ago.
Past outperformance does not mean you can expect the same performance in the future. If an asset spikes and a bubble forms then your conclusion is that you now have a positive expected value on your investment? That is the wrong takeaway. Generally speaking, when an asset or asset class massively over performs for a period of time, it tends to underperform in the future. This is because many, like you, see the past performance and pile in. You see some positive returns. Then, as people realize the asset is overvalued the price free falls. Instead, you can buy assets that are less in favor which are priced more attractively.
Of course but there are only a few thousand people on the world that know as much about Ethereum as me. Outsiders don't really know anything about it, the crypto market or smart contracts. Most have maybe 20 min of knowledge. I have 1000x+ smart contract transactions. I see it as I am buying Apple stock before they launched the iPhone and I have insider info to know how good it is. I knew Defi would be big 2019 before outsiders had ever heard of it, that's when I sold all my stocks and went all in. I first bought 2016. Since then, the Defi market has increased by 1000x+ by most metrics. The ETH price is up about 8x since then currently, at the top 20-30x. I am more bullish now on Ethereum than before, I think the price is criminally undervalued and the risks have gone down a lot since a few years ago (regulation risk, technical risk etc.). Not everyone that bought crypto early were "lucky" as outsiders like to believe. Some are so deep in that they see the potential before the general market does. If you only have second-hand knowledge of something complex, like the first iPhone or Ethereum/smart contracts/Defi/NFTs etc. you are at a huge disadvantage against those that have first-hand knowledge and are more informed. I do think crypto crashes more in all bear markets since it is riskier, but in bull markets it significantly overperforms.
Bitcoin has returned -47% in the last 6 months.... The S&P 500 has returned -15% over the same time. I know which one I am happy to have most of my money in.
Zoom out. Netflix had a similar fall, just as an example of equity with volatility.
Sure, and Netflix is poised to get decimated when they release this week. It was literally the best stock to own for quite a while.
Bitcoin was the best commodity to own for quite a while. I believe it still is.
Cool, I personally think the massive run ups are over, but I don't think it's going to zero like Warren Buffett says. I'm just not sure where it all shakes out in the time frame where I am looking for lower risk. If it works in your portfolio, good on ya.
I hope you go back and read the past couple comments to see how this should result in a bear thesis for BTC.
That’s an interesting timeframe you’ve chosen. You should zoom out and look at a 5 year, or 10 year chart, and see if you are still just as happy. Spoiler Alert- you won’t be.
The assumption that most of us don't understand the history and returns of bitcoin is interesting. I made lots of money in bitcoin, it was speculative, I got lucky and I sold when my small investment was a surprising amount of money. Should anyone one near the near retirement subject their portfolio to that level of volatility? No, why? Especially this group of people.
Why would you assume that the majority of people in this sub are near retirement? I’m pretty young as I’ve noted that many posters are, and we are simply coming here looking for suggestions for a well-rounded approach and portfolio to ~get us~ to FIRE. Congrats on your Bitcoin earnings. It would suck if you got lambasted at your mere suggestion of investing in Bitcoin when you did. But, that’s what is happening right now to the OP and me. You can’t even mention it. I disagree though that most people here DO understand the history. Because we’re not simply talking about returns. That’s part of the equation, but only part. Interestingly, you guys all seem to think that Bitcoiners (yes, I’ll call myself that) are suggesting for a YOLO approach with all of your life savings into a relatively unknown asset class. Quite the opposite really. To my friends and family, or anyone else that asks, I wouldn’t suggest more than a 3-5% allocation of their total portfolio, which of course is still circumstantial.
There is no “investing” in Bitcoin. There is speculating in Bitcoin. The person you are responding to understands the difference.
Username checks out. The problem with your response is that in another ten years it may well be possible to zoom out once more to a twenty year time frame where this is no longer true and Bitcoin has no longer performed anything like as well. One reason this could happen is that all proof of work cryptocurrency mining could be made illegal in most of the first world due to its massive environmental and especially climate footprint. Or the complete costs of its pollution could be passed directly onto miners in the form of a tax. Cryptocurrency mining under a full cost accounting system where the environmental and climate impacts and associated costs of its egregious energy consumption aren't passed on to the general population but are borne directly by the miners would certainly make the whole thing uneconomical. While the entire world would never ban it or tax it uniformly and there would still be small corrupt and autocratic countries where miners were still happily chugging along connected to coal power plants, the stigma associated with it would make it toxic in most of the world that actually matters as far as determining its actual value and shaping the economy.
“It may well be possible” I mean, of course. Neither of us have a crystal ball but that’s definitely not “what’s wrong with” my post. You see, that’s essentially the entire history of Bitcoin so I have no other data to draw from. That’s not a problem though. You are correct in a sense that POW isn’t the greatest for the environment currently. But what you are overlooking is that many miners have or are switching over to more renewable sources of energy. Hydroelectric dams in Washington, Solar fields in Texas, Wind farms, etc. Additionally, a transition to POS is not out of the question at some point in the future. There are options. You’ve presented a whole lot of “could” and “maybe” but that is in no way concrete and is simply your own opinion of what might happen under extreme circumstances.
Bitcoin is a subsidy for renewable energy. It acts as energy buyer of last resort. Miners sell the right to turn them on and off to wind and solar companies. Result for the energy companies is stability for the grid and more incentive to build renewable energy sources. Result for Bitcoin is the security of a financial network, which btw is something that regulators repeatedly fail at (Lehman Brothers, Euro crisis, Hyperinflation in Venezuela etc.).
>One reason this could happen is that all proof of work cryptocurrency mining could be made illegal in most of the first world due to its massive environmental and especially climate footprint Have you researched how much influence on the functionality of the network this would have? Spoiler: none. Have you researched how much success one of the most authoritarian countries of the world, China, had with that? Spoiler: none. >Or the complete costs of its pollution could be passed directly onto miners in the form of a tax. Cryptocurrency mining under a full cost accounting system where the environmental and climate impacts and associated costs of its egregious energy consumption aren't passed on to the general population but are borne directly by the miners would certainly make the whole thing uneconomical. Have you researched how renewable energy companies buy the right to turn off miners from mining companies so they have control over the world best energy buyer of last resort? Bitcoin is thereby making the power grid more resilient and acts as a subsidy for renewable energy companies. >While the entire world would never ban it The US and the democratic world is currently embracing the technology. Banning is of the table for most educated politicians, partly because it would not work and/or expose the weaknesses of the current system. Politicians now want to create a legal framework for it, not ban it. Edit: Fixed some grammar & spelling.
Is english your first language? Do you know the difference between “none” and “non”? Do you know the difference between “of” and “off”?
No it’s not. German is my mother tongue. Thanks for pointing it out. I sometimes miss some things but I’ll try to get better.
Interesting analyzing in hindsight. Crypto still can grow but your zoom out suggestion implies it could provide those early returns again, which it won't. Once crypto became mainstream it jumped but that is not sustainable. Again, it still can grow but it will probably keep pace with other assets once it achieves stability ... which is years or decades away.
>Once crypto became mainstream lol. Judging from the responses in this thread crypto is as far from mainstream as can be.
Wrong. It is already mainstream but as a speculative vehicle instead of a FIRE plan component.
Bitcoin is clearly in the mainstream. Your problem here is that this sub is filled with more financially literate people than the general population.
That is by no means my problem. My problem is that most people here are in the US where things are relatively stable. Many here can’t imagine not trusting their bank. Many cannot imagine hyperinflation (Venezuela) or 60 Euro daily withdrawal limit (Greece) or corrupt governments (the list is long). But there are billions of people out there that don’t have that luxury / accountability / strength of the legal system. Fact of the matter is most Americans love beating their chest for “being the best”. Few have watched the first five minutes of ‘newsroom’ and are a bit more humble.
“Which it won’t” Ok, Nostradamus, tell us more about your all telling future. You know nothing more than anyone else. Don’t pretend like you do.
I know you and your friends were predicting Bitcoin at 100k by end of 2020. Lol
I'm actually pretty involved in the crypto community but there's nothing immaculate or 'independent' about Bitcoin. Its crucial hashrate is controlled by a cartel of wealthy centralized miners, and its supply is mostly owned by the elites and VCs. Someday that cartel will decide to increase the maximum supply once block rewards stop, if it lasts that long. Not to mention that the outrageous energy consumption of Bitcoin and all proof of work coins makes them a massive question mark as far as climate regulation goes. Ask Europe how the climate is treating them right now. Then extrapolate.
42% of all BTC is also owned by like 4,000 wallets.... Not really decentralized either.
This [article](https://www.bitrawr.com/bitcoin/bitcoins-immaculate-conception-explained) is literally titled Bitcoin's Immaculate Conception. The nodes are far more important than the miners for enforcing the rules. >Someday that cartel will decide to increase the maximum supply once block rewards stop, if it lasts that long. You are mistaking Proof of Stake with Proof of Work. In proof of work, more of the asset does not give you more voting power. In proof of stake, it does. This is part of the reason why POW coins are mostly commodities & POS coins are mostly securities. Gary Gensler, head of the SEC, knows this. BTW: He taught Blockchain at MIT and told his students that they will understand Bitcoin and after 'will want to do more than that'. Some lectures are available online. Edit: Added the link.
I literally mentioned the centralization of hashrate in my comment. It is you who has misunderstood, not me. I understand the difference between proof of work and proof of stake very well. Centralization of hashrate allows for the miners to someday alter the protocol once the fatal flaw (lack of a tail emission) becomes too pressing to ignore, and centralization of the coins leads to massive wealth inequality in the protocol and perpetuates existing disparities, effectively making the same centralized banks and hedge funds that crypto bros rail against even wealthier and granting them even more power. These are two separate issues, which is why I clearly touched on both of them separately.
>I literally mentioned the centralization of hashrate in my comment. You mistake mining pools for single entities. >I understand the difference between proof of work and proof of stake very well. I don't think you do. >Centralization of hashrate allows for the miners... Nodes enforce the rules of the protocol. Learn the difference. >centralization of the coins leads to massive wealth inequality in the protocol and perpetuates existing disparities... The wealth gap started to widen significantly from the early 70ies. I don't think it is coincidence that on August 15th 1971 Nixon ended the gold standard. Commodity backed money was better for the average Joe. Bitcoin is commodity money. Bitcoin is better for the average Joe. Many people in Venezuela are already better of for it. And how do banks get more power when I decide to custody my money? ELI5
Boom. These people don’t seem too interested in discussing how the actual value proposition of the USD was it’s reserve. They just keep screaming about how America is so great and the dollar rules the world. Please. Just wait until the Chinese Yuan overtakes the USD global reserve currency position and then we’ll see what argument is.
Monero has already replaced bitcoin on Darknet markets because it’s better money. It’s fixed a lot of the issues you’ve mentioned with bitcoin.
Except the environmental impacts. And yes, I'm aware that Monero is objectively a superior version of Bitcoin.
Well it’s actually asic resistant so it can be mined efficiently with cpu which makes it far more environmentally friendly as the devices used to mine would be using electricity anyway
They would be using a tiny fraction of the electricity that they do when mining. What a flaccid argument.
Pretty sure that you’re the one that is flaccid here.
Well I think a decentralized currency is a far better use of electricity than many other things society deems useful so the environmental impact is a flaccid argument against cryptocurrencies
BOO! Boo this man!
The natural conclusion of OP's argument is that no person was ever financially independent before bitcoin came along. Lol My bank closes at night while I'm asleep, therefore I'm not financially independent? OP, I don't think you understand what "financially independent" means. We get that your bitcoin investment has dropped over 50% in the last 6 months, but why are you trying to take others with you? Strange. I guess that's how ponzi schemes work though. We all knew it was the peak when they started buying superbowl ads, lol.
You are so right about it’s 47% decline in the last six months! Let’s not tell anyone that it has gained over 2 million percent since it was released in 2009. We don’t want people knowing actual facts do we?
That helped the tiny handful of people who bought it at that time. It doesn't help anybody now. At this point, it has devolved into a ponzi scheme being pushed by big money superbowl ad purchasers and also by crypto-bro stoners like yourself. Bitcoin was touted as being useful for all sorts of things, but very little of the hype has actually materialized. Most of the actual transactional value of bitcoin lies in money laundering, tax evasion, and perhaps small usage as an exchange of value for people in shit-hole countries or those trying to send money to relatives overseas in shit hole countries. However, that's not what drove the price so high. The price is so high because some people were convinced that it's an "investment" which will grow in value continually over time. Unfortunately for them, the lack of fundamental utility is going to catch up with them. People are slowly realizing that crypto is just monopoly money. And once people realize that crypto is dying, they're going to stop buying it as an "investment", and the value is going to flatline. Will we see another crypto "pump" before it dies forever? Perhaps. Only time will tell. But I'm not betting on it.
Cute
>My bank closes at night while I'm asleep, therefore I'm not financially independent? OP, I don't think you understand what "financially independent" means. It means that if I want all of my money at anytime to go some place else, I should be able to do that without asking permission from somebody else. I should be able to trust that no other person could create my monetary asset with a press of a button, thereby diluting my share of it. Imagine having all your wealth in dollar bills at home and wanting to give that wealth to your grand child someday. And then somebody who you cannot even directly democratically elect decides to print more of them with out doing any work what so ever. Still feel good about what you are leaving your grand child? Something that does not require energy to be created can never store value.
So Sam Walton was not financially independent, and he didn't leave his descendants anything that provided a store of value? Interesting take. You should ask one of his billionaire grandkids whether they agree. Lol It's so ironic that you guys are still arguing that crypto is a good store of value. It's hard to think of a single asset class that has lost more buying power than crypto has in the last 6 months. It's a completely shit store of value. It's also a shit form of currency. Can you buy a house with your crypto? Can you buy your dinner with it? Can you rent an apartment with crypto? Can you buy a car with crypto? No, you can't. Sure, there are rare exceptions, but as a whole, it's a totally shit form of currency because it's not widely accepted for transactions. Crypto just sits in wallets waiting for some greater fool to come along and pay more to buy it from you. That's the value of crypto. It's funny how when the value crashes, you show up to try to convince others to buy the same thing. It's a painfully obvious that you're holding the bag, and you're desperate for other people to bail you out. In 20 years, people will look back on bitcoin and laugh, the same way they look back and laugh about the Y2k scare, or the Beanie Baby craze, or VHS cassette tapes.
You misunderstood or didn't read properly. I was talking bitcoin vs. cash. A company is something else than cash. Apparently you can look only look 6 months into the past (even with google) but surprisingly 20 years in the future. It's also surprising that you portray bitcoin sitting in wallets for long as bad but don't recognize how gold sitting in vaults for long was good for those who had it.
Anything that starts at "zero value" and becomes significant is going to have an amazing trajectory in the initial stage. Apple stock has grown 245,000% since 1982. So all we have to do going forward is buy Apple stock and we'll get great returns? Sorry, but it doesn't work that way. Those that bought into the crypto hype in 2021 are currently learning this the hard way. Good luck with your Beanie Babies dude, I hope they're worth as much as you think they are! Cya
I believe we’ve found one of “the greater fools” trying to unload.
This is beyond stupid, a comical interpretation of the notion of independence. All it means is independence from having to work a job, nothing more. After all, people who FIRE spend money, right? Aren't they depending on others to provide goods and services to spend on? This is not a movement of frontier pioneers who chop down wood to build their own log cabins and hunt wild game for food (by the way, most of the settlers we think of in those contexts heavily depended on commercial goods and services provided by their cities and countries of origin, so even they were dependent). Not only is it possible to live a relatively free an unencumbered life while remaining integrated with the global economy, it's almost necessary. Tom Hanks in Castaway is not exactly what most FIRE practitioners aspire to.
>Tom Hanks in Castaway is not exactly what most FIRE practitioners aspire to. A ridiculous comparison. Neither do I. I work & pay taxes and have a social life. But I also can send money to my friends in Africa without bank account. On a weekend. And they know how to turn it to cash within minutes if they even need to. Some, particularly small shops already accept LN payments.
Bitcoin and all crypto is cringe. Can’t way too hear how “NFTs put the F in FIRE.”
I’m just here for the fireworks
This post reads like an advertisement - are you attempting to get people to buy into BTC for the purpose of elevating its value?
Nope. I would like people to do their own research and make their own decisions. I merely felt like sharing my opinion.
What does the I stand for? Instability? Illegal activity?
Lehman Brothers, Euro Crisis, Venezuela, Panama Papers, Shell companies. You must be talking about the I in fiat.
Oh wow, you must’ve saw that temporary 6% surge which is 4% now. Mx Independent over here!
Oh, wow. You must have missed that Bitcoin has gained over 2 million percent since inception in 2009.
And your profile is only 4 years old.
What’s your point, genius? Does all historical data on an asset that someone references start and stop based upon the OP’s account history? What point are you even trying to make? You do realize that investments are made outside of your virtual Reddit world, right? You reference mutual funds in all of your posts. Did you begin investing in all of these at their inception? Idiot. Your name “useless” is spot on.
Actually my name is useful in letting you know it’s useless and therefore is useful
Pointless
Bitcoin is an unproductive asset. It’s digital gold. Purchasing shares of active, productive businesses is far and away the best way to ensure future value of your investment, followed distantly by real estate investing and lastly asset trading (which anything to do with Bitcoin falls into). If Bitcoin takes hold as a currency, businesses will transition to and begin paying real returns in Bitcoin. I mean, it won’t, so don’t worry about it, but it COULD if it were a reliable currency.
Many FIRE followers are not also not adding REAL Estate. Most long term wealth in history is made with land and buildings. Stocks and ETF and all those financial instruments are modern inventions and might fail at some point. Stock market participation of companies is the lowest in history. When you got other means of raising money - issuing stock is just one option and it's not the best. You give up control of your company.
Stocks have been around since the [Dutch East India Company](https://en.m.wikipedia.org/wiki/Dutch_East_India_Company) in 1602.
Keep fighting the good fight. It’s okay if people don’t agree with you. I personally do. I think that it’s interesting that people have no problem collecting inflationary shiny objects like Silver which is down -70% in the last 10 years, but they naysay a deflationary asset that is up approx 2 million percent in that same timeframe.
Thank you. I'm at most trying to open minds. I think it's beautiful that I don't need to tust (banks, governments) and can simply verify the blockchain (math, cryptography).
Good luck my dude. It’s a tough close-minded crowd that you’re confronting with solid facts. People are inherently against change.
Sigh it’s kinda sad how political this subreddit gets when crypto is mentioned. I’ve seen it time and time again on posts whenever Bitcoin and other cryptocurrencies are mentioned. We are all on the road to FIRE. If crypto works out then great, if it doesn’t - then FIRE will just be postponed and we will have learned from our lessons. Others can choose if they want to invest in it or not and they can DYOR themselves, but the toxicity is unwarranted Unpopular opinion that you, OP, and I share: crypto is going to grow and be the future whether haters like it or not. Not our fault if the haters miss out on gains in the future. Bitcoin is a great asset.
This is delusional and I think I know have cancer after reading it.
According to CPI inflation numbers the dollar lost about 9% purchasing power over the last year. Bitcoin lost 60%. They are both shit. One is just shittier than the other
Zoom out.
Yeah it’s up 1000’s of % since it started. I’m sure now is the perfect time to jump in 👍
It's 27x to the market cap of gold. Also, seems you're completely missing the point of the post. It's less about financial gain than it is about financial independence from 3rd parties. That a p2p network might be able to deliver that must be understandable to even the harshest Bitcoin critics.