This is it. Margin trading on Bitcoin for unsophisticated retail investors. Here we go...
Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
91–100 of 317 posts
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#92Earlier quoted context omitted.
A better question might be: How is anything an investment? If the stock market is priced efficiently, it is as much a gamble as Bitcoin. The stock market is of course not perfectly efficient, but it is likely extremely efficient relative to the knowledge of your average retail investor. Which means that buying Bitcoin or other cryptos is no more a gamble than any stock market investment with a similar volatility.
I also think the stock market is not "investing" but think it's safer to invest. 1. There's more government regulation and less manipulation. 2. New money is constantly flowing in, via 401K's and pensions. Most people aren't even aware they're invested in the stock market. 3. The government cares so much about the stock market doing good. Look at how Trump brags about the booming market. If it goes in a funk, the gov…
> less manipulation
> If it goes in a funk, the government will think of ways to prop it back up
I don't disagree with the second statement. I guess what you're saying is that there is manipulation (talking about government intervention in this case) but overwhelmingly in the "right" direction?
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#93I think the feature makes lots of sense for Robinhood from a business perspective, but I cannot see the majority of Robinhood users fully understanding the risks of buying cryptocurrencies as an investment. It feels similar penny stocks and late-90s tech IPOs in that the price is driven primarily by uncertainty/unknowability in outcome and hype from recent returns. Also I'm curious if Robinhood Gold (Robinhood's vers…
I agree that margin trading on Cryptocurrencies is extremely risky and not fully understood by the majority of people doing it. I am very anxious to see what will happen in the long term since so many people hopped on the bandwagon in the past 2 months and I believe a quite large portion of them went into credit card debt to do it. I have been telling people I know personally that I thought Coinbase allowing the use of credit cards to purchase was asinine, and I am curious to see what will happen.
Capitol One is now blocking all coinbase transactions, and Chase is now running them as cash advances, so the credit card companies are aware. I think there may be a large amount of CC defaults due to cryptocurrency "investors" realizing they are in over their heads in the coming months.
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#94Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#95> Invest in Bitcoin & other cryptocurrencies > Cryptocurrencies, stocks, ETFs, and options are now available side by side — all easily accessible in one app. Managing your investments just got even easier. There is a dangerous theme of companies aimed at millennials that misappropriate Bitcoin (etc) as an investment, when it is just glorified currency exchange speculation. Blurring these lines obscures the real-world…
I buy bitcoin, it changes in value, I cash out, I now have a different amount of money than I put in. How is that not an investment?
>I buy bitcoin, it changes in value, I cash out, I now have a different amount of money than I put in. How is that not an investment?
This sentence explains everything about the world we now live in.
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#96Earlier quoted context omitted.
When you put money into blackjack you're not buying an asset. A crypto coin is an asset that can be held. Just like a share of a company, or a dollar itself.
I can hold a lottery ticket.
yes but it's a bad analogy because the odds are known and if you don't win the lotto the ticket is worth nothing. all bitcoins are equally valuable ( fungibility ).
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#97Earlier quoted context omitted.
I put money down on a blackjack table, play a hand, win, and cash out with more money than I put in. How is that not an investment?
A better question might be: How is anything an investment? If the stock market is priced efficiently, it is as much a gamble as Bitcoin. The stock market is of course not perfectly efficient, but it is likely extremely efficient relative to the knowledge of your average retail investor. Which means that buying Bitcoin or other cryptos is no more a gamble than any stock market investment with a similar volatility.
What separates investing from gambling is the expected return for everyone is greater than zero.
AKA buy stock at 100$ and sell it at 100$ does not mean you broke even. You could have gotten 10$ in dividends. Now that positive may be small and some people may lose money, but that's allowed as long as the expected returns end up positive.
Bitcoin's can't have a net positive return because they only way to add money into the system is via coin buyers. Further because of transaction costs it's inherently negative sum.
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#98Has anyone else noticed that there is no documentation about withdrawing funds? It looks like you can only buy and hold within the app.
Seems a bit pointless unless you're strictly interested in day trading and don't actually care about crypto.
If this is true, that means these are cash settled and they might not actually be backed by any assets. That idea is scary and I would avoid it.
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#99I wonder what the thinking behind the name is. It seems like a bad idea to entrust your money to a startup that is named for someone who's famous for "stealing from the rich".
who cares, it's working. you're talking about it. look at all this free marketing.
Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies
#100Earlier quoted context omitted.
Because...?
Because it is based on supply and demand, it's just more volatile than what you're used to. Doesn't make it luck
The price is a function of the supply and demand.
The supply is mostly a function of time, as defined by the blockchain's algorithms.
The demand is a function of what, exactly?
Still looks mostly like luck to me.