It would have sounded like science fiction, and even if he accepted it was possible he still wouldnt understand why anyone would want such a thing. Think about how tomorrows generation will use far a more advanced blockchain tech to interact with far more advanced internet and general tech to create things that we cant even conceive of yet, let alone why they would have value. He is typing in capital letters to draw attention to specific words. If youre one of these credible people, please do so in the comments or in a blog post on Medium that we can all read. When we talk about Bitcoin, or Ethereum or any other digital coin, for that matter, neither ponzi nor pyramid are perfectly accurate descriptions for how these systems actually work., The cryptocoins represent a new kind of scam, a Nakamoto Scheme: https://prestonbyrne.com/2017/12/08/bitcoin_ponzi/. Is this likely to be worth $20,000 long term? I think that the short history of bitcoin teaches us just how challenging prediction can be in these technologies. Mr. Money Mustache shares his opinion about Bitcoin. Do we really want a place where youre either an Amazonian or Walmartian? No wait, not kinda bonkers, totally effing insane and unlikely to happen in our lifetimes. LennStar Ive been thinking of doing just that.. And then I put it off for a few weeks, and the price jumps up exponentially. No. Bitcoins will never degrade over time, your fingernails degrade. Something only has value if ppl place a value on it. Tim Beck Maybe some other crypto-currency can overcome those issues and some have, but still a long way to go. Some of them have no earnings at all. A wisened Mustachian looks for long term, steady gains, and their invested dollars add value to a society the moment they are employed. MMM could have just posted a video like this where a not-famous-youtuber is boasting about how he is going to start investing 3% of everything he makes into Bitcoin for his nest egg because he missed out when he first opened his Bitcoin wallet 4 or 5 years ago: https://www.youtube.com/watch?v=ubnMyPZS86E. It seems like youre advocating for scenario #2. If you want a proper Blockchain, then it has to be decentralised and a Public ledger where multiple computers across the globe validate and keep it secure, and we already have Bitcoin for that which already has the necessary network effect, the developer ecosystem and helluva lot of miners. Hard to shove a tulip bulb through the wires, eh? Stocks and bonds and real estate can all enter into bubbles. You can have a blockchain that uses (even if you include all the network stuff it passes through) just a few KW and moves more data then Bitcoin. No. 0 replies 0 retweets 3 likes. In a sense one could swap bitcoin to USD and the article still stands. Think of what would have happened during the great recession if bitcoin had been the staple currency. Marketed to unsophisticated investors as a get-rich-quick scheme. I know have around $20k in crpyto having invested around $3500. This idea that you HAVE TO OWN ONE FULL BITCOIN is madness. Ive made more per hour than I do at my day job compared to the effort that I have put into this. If you cant grasp the difference between the two, then by all means sink your capital into crypto-currencies as they are currently valued. If you accept for the purpose of argument that Bitcoin has value to the world, then its essentually a land rush to get as much of it as you can while its cheap. So, Bitcoin is supposed to replace all forms of physical currency in theory because people dont trust banks. To keep things non-promotional, please use a real name or nickname(not Blogger @ My Blog Name). Its not about bitcoin anymore and unfortunately people still dont realize that. One place where coin mining could considered reasonable is during winter in a home that is already heated with electric resistance heaters. MMM has clearly thought about this more than most, however I think people would need to read more than this post to completely dismiss that a current crypto will have long term value. January 2, 2018, 9:01 pm. Absolutely, so Ill proceed with it. But its not some spectacular Instant Trillionaire piece of magic. Ultimately, Bitcoins functionality is what the digital asset should derive most of its value from. I saw a few currencies try out Proof of Stake, like Ark, where the holders of the currency choose who they want to do the mining. A stock is a share of an actual company, bound by rules and regs (however imperfectly administered, at least they exist). Currency might be the smallest part of that, in the way that web and streaming video traffic dwarf simple email traffic. EvoInvestor I can trade with anyone in the world for a low price (not necessarily with bitcoin as the price has gotten expensive but with other currencies). Devs in their mid 20s who owe the IRS 50k and lost most everything. As of now, BTC has none of those characteristics. Let me know when you find a buyer for your $70k fingernail clippings. Pete and his wife retired at. Lets take the oil price in the middle of the last decade as an example of a real bubble. Also, a currency should not be artificially sparse. I am already looking forward to looking back and laughing at all the companies who did away with their normal businesses to become mining companies. Redirecting to /r/mrmoneymustache/comments/mz1sma/thoughts_on_mmm_why_bitcoin_is_stupid/h094ynt (308) You cannot create more coins than are programmed to ever exist. You know things arent a good investment when there are Bitcoin ATMs at bars. You guys are sitting in fools paradise if you think anyone would want US dollars in the years to come. Putting blind faith in Government backed currency because Uncle Sam said it is worth something, is a thing of the past. So right there you can scratch off any use of blockchain as pointless if it doesnt benefit from immutability. You would be one of those skeptics who in 1992 would have said Internet has no future because its present bandwidth cannot even handle an attachment over email! As we know from MMM teachings, safety and security are lies. People fall in love with works of art. But instead of seeing how ridiculous this is, even morepeople start piling in and bidding up every new variety of pills (cryptocurrency), over and over and on and on, until they are some of the most valuable things on the planet. Doh! Dan, I am not angry when someone says they dont want to invest in it. Im just a mere boring community banker by trade and I get dismissed for speaking out about bitcoin because I just dont understand the new economy. You mixed that up. $100 per post is pretty motivating. Hes helped thousands of people improve their lives. If youre one of these credible people, please do so in the comments or in a blog post on Medium that we can all read. Broadband. Some of my conversations with him inspired the research in this article. Get out while you can. It then proceeded to burst in spectacular fashion just ahead of the financial crisis, plunging all the way back to $30 before rebounding. I dont know how many of you can even get to understand what this is but hopefully you understand something from the URL I share below of how mining is done, and why this is not some idiotic electricity consuming joke! This is no different from rich wall street people and government controlling fiat currency.. Now lets get back to your kick-ass money savvy engineering experiments :-), Oh, dont feel too bad. It is the main currency by which you can obtain other cryptocurrencies. So, I harvest other peoples speculation and I dont lose anything, as I have already harvested more than what I put in. Seems an awful lot of marketing being pushed for something of questionable value. Andrew Kravitz I understand this is an MMM forum but i mean come on.. you have to recognize that managed risk is a part of building wealth. I wouldnt! And pray blurt out as to why it is bad equivocation? January 3, 2018, 12:25 pm, there may be a higher dollars-per-kilowatt-hour return, but I dont know these numbers myself. A Ponzi scheme is a fraudulent operation designed to steal peoples money. January 3, 2018, 7:59 am. Yep, really fluid and efficient system that takes 3 days and $20 to record a single transaction, I remember about 20 years ago the starry-eyed optimists predicting the end of brick and mortar banks within a decade or two. 1 Replies 290 Views February 10, 2023, 05:55:08 AM . The short answer is they can do nothing about it! This is also wrong, Zimbabwe did not abolish taxation yet the worth of Zimbabwe dollar has vanished anyway. If the standard institutions werent a (govt-supported) bunch of crooks & were not in place to help only their cronies, this whole bitcoin situation would likely never have happened. But again, this is not investment but speculation! 2) Prices rise so much that earnings increase while stock prices remain the same. Bitcoin is actually a saviour that provides the world an opportunity to get out of total mess without fighting a WW3! Not likely, bitcoin mining farms are in China because of the cheaper energy costs. To most of the Internet, Mr. Money Mustache is known as the quirky early retirement financial guy, and this is a blog about Money. These people are either shit scared of the changes that are going to come, or dont understand macro economics. When I started to feel some FOMO, I know we have to be close to peak interest. They may settle to much less, or get close to zero, or they may grow more, no one can really predict this. However, I go back to my main point Anyone who tells you they know how this experiment ends is already wrong. Liked. Its super risky and probably not compatible with mustachianism, but that said its pretty interesting and I think it remains possible that MMM is wrong. As the legend goes, an anonymous developer published this whitepaper in 2008 under the fake name Satoshi Nakamoto. For one, your irrational hatred of gold, whose function for human beings you do not seem to understand. Kevin S Coleman The growing demand for more electricity is the most serious issue with Bitcoin, IMO. I believe I may be allergic to mercury. Tim Beck The issue with the .com bubble was internet companies were given a high valuation with no demonstration that they were profitable or even provided a service/product. Enjoy your crash. Except for ripple coin. One book that I found very useful in understanding the greed-fear cycle (and Central Banking and the Federal Reserve system to boot) is the 2001 classic Towards Rational Exuberance by Mark Smith. (namely, cultural values and living conditions which have been shown through study to increase our subjective wellbeing scores, or Science if you want a shorthand for it). Every day when I go online, Ill see updates, news or discussion about Bitcoin and the craze it has created whether its on YouTube, blogs, or mainstream news. Mr. Money Mustac. Right! In short, historically gold is the truest measure of value, the safest store of wealth, and best insurance against fiat money and other manias (see Weimar Republic circa 1934). Mr. Money Mustache is the website and pseudonym of 48-year-old Canadian-born blogger Peter Adeney. In a world of human trust, putting the wisest and most respected people in a position of Adult Supervision is a useful tactic. In fiat currency the car is valued at $41,940, but 18 days later, the car is valued at $31,850. My heart would break if I said goodbye to $200k. This is exactly what I was thinking. Keep plenty for yourself. Its trust is the full force of the weapons and arsenal behind it. The comment about 1999 investors didnt receive their investment back from stocks until this year well, for the rest of us that dont invest 100% of our money in the stock market in one instance AND we reinvest dividends, this type of situation is almost impossible. The value of bitcoin is very far removed from any sensible fundamental valuation, and the thing driving up the price seems to be a common sense that it will be worth more in the future. Why does bitcoin have to be the winner? Probably because it was the first and still the largest blockchain based tech, a lot of capital has gone into Bitcoin mining equipment. Bitcoins etc does not make it easier at all. Everything thats happening in the crypto space is just so normal as you would expect investors struggling to get the price right for something beyond the control of regulation. I believe the current Cryptocurrency investment mania is a huge waste of human energy, and our rate of waste has been growing exponentially. US is just one country in this big bad world, and not vice versa! destroy? Remember 2008? Well, SOMEONE has to keep the bankers & wealthy rich, right??? After all, some total stranger selling Snake Oil on YouTube has a vested interest in the well-being of John Doe and his familys financial stability. January 2, 2018, 9:18 pm, MMM, heres a calculator that updates to show the real time profitability of mining various coins: Shorting bitcoin would just be speculation in the opposite direction. Its a little like taking out the garbage. I read an interesting article regarding the price fluctuations, but I cant find it now. January 2, 2018, 5:49 pm. Im always reminded of VHS versus beta max but on a few thousand options scale (rather then two) and a higher risk if you choose wrong (at current prices). The only flaw with your fingernail analogy is that most of your devotees would only be too willing to fork over $70,000 for them. nVidia shares, purchased right after they were found liable in some court case and thus were a bit depressed, were some fantastic shovel sellers for me these last few years :), Dan Someone It isnt enough to live off of, but its definitely nice to have a net $500 or so in my pocket at the end of each month. January 3, 2018, 5:30 pm. Soon, they will be on the brink of bankruptcy and you will be able to purchase all of their stuff at a discount. The problem with Bitcoin, (really all of the crypto currencies) is their value is not tied to anything of value. And you should be prepared for it. Blockchain technology may do that too. Listen on: Apple Podcasts, Google Podcasts, Spotify, YouTube. January 2, 2018, 6:30 pm. Also, what is the source of that study? Then the mining ist just looking up data in this table. BTC wont be the winner but with over 1300 coins the winner has likely been created. Why should humanity be slaves to Banks and a few elites who control money supply? Because hydro acts as a massive built-in storage in both the short term (ms, seconds) and long term ( hours, days, I keep hearing everyone speculating on whether or not they should invest in Bitcoin, while at the same time googling what cryptocurrency and block chain is. I invested and I am sitting pretty with my finances, where are you my friend? Time will tell. That is why I also invest in government bonds. Still no fundamentals. When evaluating investment bubbles, it means looking at where everyone is throwing their money no matter how many billions and being willing to say Bull. Remember there was social media before Facebook. Just because the last while has been great, it wont always be that way. Max Thunder Mr. Butler Bitcoins are scarce, your fingernails are not. January 3, 2018, 7:20 am, If you could have somehow monetised the Internet in 1992 and sold it. The dams generate electricity whether you need it or not. There is a reason that central banks own most of the wotlds gold. youre supposed to pay taxes on gains in crypto too . Tulips anyone? So, we usually get $100 to $200 worth of stuff all at once. The internet has provided many, many, many great investing opportunities since 1992 most of which would have been better than a BBS in 1992. Who would help the poor, elderly and uneducated those without BTC? Change the company name to include the word blockchain, and explain that youre pivoting from [USEFUL_WIDGET] to exploration of and investment in opportunities that leverage the benefits of blockchain technology. No one foresaw that VHS would win, and yet Betamax was gone not many years later. The behavior of bitcoin since the genesis block has been completely different. Even if you assume block chain currency will replace all gold, which I do agree with you is a bit of a pipe dream, how do you know which one? Its interesting that you state the high water mark was $700,000, but now its $500k. Is having 1-2% of my overall portfolio in cryptocurrency stupid? No, not to me. Travis, your are right. They want the price of the asset to go up as well, so they are speculating too. Chris Urbaniak That has happened before in the world. Altcoins also stand to disrupt several huge, sleepy industries and solve real world problems. MMM calls Bitcoin Stupid and all these things as some kind of Ponzi Scheme! How much of your net worth is in this investment? in my opinion. So, all of the normal, previous ways of saving have been destroyed & the banks/corrupt bankers get bailed out, over & over & the regular people are sick of it. If you do not know, We have prepared this article about details of Mr. Money Mustache's short biography-wiki, career, professional life, personal life, wife, girlfriend, dating, divorce, kids, today's net worth, age, height, weight, and more facts. I remain open to more information on the uses of Blockchain, but Ive never seen a valid fundamental reason for betting on future increases in the prices of these things. I dont have time to play PC games 24 hours a day, so I might as well use my fancy computer to make some money while Im away from it. But I hope the good times continue for a long while! The financial strategist has established a large audience by favoring slower-paced bets on surer outcomes over cryptocurrency's notorious high-risk-high-reward scenarios. Ive been watching this with fascination as its been a while since we have seen a hype and crash investment (because we only know which way this is going to go, right)??? 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