S&P Dow Jones Indices to launch cryptocurrency indexes in 2021 • Hacker News Board

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#121

Post by csomar » Thu, Dec 03, 2020, 5:33 PM UTC

iamspoilt wrote: post #30

Someone please explain this to me: How is any cryptocurrency even considered an investment vehicle? I would classify myself as Boglehead and I believe in the fundamentals of investing in stocks because in all it's technicality (and given the buy-and-hold strategy), you are investing in a business by owning a part of it which naturally means that you will and do get the returns on it, both in terms of profits (dividen…

If you think of an investment vehicle as something that creates useful infrastructure in society and collects fees to pay dividends, then no. But then, look again, we are way past that. We are pulling Gold from the grounds to hide it again in the ground. We are trading weather futures. And people are buying apartments no to rent them or use them; but just to close them and leave them empty.

In this sea of non-sense economic reality, Bitcoin actually makes lots of sense.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#122

Post by baron_harkonnen » Thu, Dec 03, 2020, 5:33 PM UTC

ozorOzora wrote: post #57

baron_harkonnen wrote: post #43

Earlier quoted context omitted.

I recommend you read some of Stephen Deihl's thoughts on the subject[0]. You're not alone if you feel that cryptocurrency doesn't make sense as an investment vehicle, but the HN community will make you feel crazy for not seeing what a great thinking this is an incredible new opportunity and "things are different this time!" There is no better indication of a bubble then people telling you that you're the crazy one fo…

"The Politics of Bitcoin: Software as Right-Wing Extremism"... just wow. Is it crazy to consider that crypto companies might simply provide better tools than a lot of banks, therefore driving worldwide adoption?

Your argument here makes it sound like people are using crypto for practical applications on a scale approaching banks. If that was the case I would be far less skeptical, but, aside form a few enthusiasts that make crypto transactions to make a point that "people use these" I don't know of anyone that uses crypto for practical, everyday financial transactions.

Can you provide me some evidence that people are using crypto at a large scale, and that that scales in increasing in a way that it is anywhere near competing with banking services? It seems that even after a decade of enthusiasm people are still mostly "investing" in it.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#123

Post by JxLS-cpgbe0 » Thu, Dec 03, 2020, 5:34 PM UTC

x87678r wrote: post #111

iamspoilt wrote: post #30

Someone please explain this to me: How is any cryptocurrency even considered an investment vehicle? I would classify myself as Boglehead and I believe in the fundamentals of investing in stocks because in all it's technicality (and given the buy-and-hold strategy), you are investing in a business by owning a part of it which naturally means that you will and do get the returns on it, both in terms of profits (dividen…

I dont understand it either. To me yes BTC supply is limited, but there are lots of cryptos so BTC is nothing special. The secret could be if lots of important and smart people are invested in BTC you have to trust that it will keep being special, and better than other cryptos. It sounds sketchy to me, but the network effect is real so there might be something in it. It seems lots of well known financial people are g…

> It seems like a ponzi to me

A Ponzi Scheme relies on a central authority, BTC by definition has none.

Maybe you were trying to say "market manipulation" or "securities fraud?"

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#124

Post by csomar » Thu, Dec 03, 2020, 5:34 PM UTC

Triv888 wrote: post #119

nostrademons wrote: post #67

Earlier quoted context omitted.

It's analogous to investing money in USD or GBP before those countries were given a license to print as many USD and GBP as they wanted. Before then (1931 for the pound and 1933 for the dollar, though they maintained de-facto parity with gold until 1971), dollars and pounds were considered good investments. That's why we had bank runs: people thought their money would be safer under their mattress, and preferred to o…

Bitcoin specs change all the time and they could decide to increase the supply

That would result in a certain fork. We had already had that and it seems the majority has decided to stick with the initial rules even though the fork wasn't about supply but something that will give bitcoin more practicality.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#125

Post by misnamed » Thu, Dec 03, 2020, 5:34 PM UTC

nostrademons wrote: post #67

iamspoilt wrote: post #30

Someone please explain this to me: How is any cryptocurrency even considered an investment vehicle? I would classify myself as Boglehead and I believe in the fundamentals of investing in stocks because in all it's technicality (and given the buy-and-hold strategy), you are investing in a business by owning a part of it which naturally means that you will and do get the returns on it, both in terms of profits (dividen…

It's analogous to investing money in USD or GBP before those countries were given a license to print as many USD and GBP as they wanted. Before then (1931 for the pound and 1933 for the dollar, though they maintained de-facto parity with gold until 1971), dollars and pounds were considered good investments. That's why we had bank runs: people thought their money would be safer under their mattress, and preferred to o…

A deflationary asset class encourages hording, not spending or using in other ways. There's also no real limit to the number of crytocurrencies that might appear later (see: MySpace replaced by Facebook), unlike gold. As for inflation: safe government bonds have historically kept up with that over the long haul, so no big loss there.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#126

Post by wsc981 » Thu, Dec 03, 2020, 5:35 PM UTC

iamspoilt wrote: post #30

Someone please explain this to me: How is any cryptocurrency even considered an investment vehicle? I would classify myself as Boglehead and I believe in the fundamentals of investing in stocks because in all it's technicality (and given the buy-and-hold strategy), you are investing in a business by owning a part of it which naturally means that you will and do get the returns on it, both in terms of profits (dividen…

I see Bitcoin as a hedge against the USD and EUR as I feel the currencies will be in trouble in the coming years.

I see Bitcoin as a store of value. Keeping some of my assets in Bitcoin keeps some of my assets out of the hands of governments and banks and will not be affected by devaluation. There's no risk of a bail-in [0] for example.

I don't invest all my assets in Bitcoin, currently perhaps 10% of my net worth. I do feel Bitcoin will rise to 100.000 USD in the next few years and possibly even 1.000.000 USD in 10+ years, my aim is to gain a total of at least 3 BTC or so in the next year. I just hope Bitcoin doesn't rise too quick in value in that time period, since I can only afford to buy for maybe 1.000 USD per month.

I might sell a bit of my Bitcoin assets after my total Bitcoin asset value reach around 500.000 USD, since at that point I should be able to take things slow. At that point I would diversify a bit more into ETFs or stocks.

Perhaps this video [1] by Raoul Pal can give you some insight in my point of view, as I agree with him on most points.

---

[0]: https://www.forbes.com/sites/nathanlewis/2013/05/03/the-cypr...

[1]: https://www.youtube.com/watch?v=qL2LfVRl3J0

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#127

Post by raziel2701 » Thu, Dec 03, 2020, 5:35 PM UTC

zapdrive wrote: post #34

iamspoilt wrote: post #30

Someone please explain this to me: How is any cryptocurrency even considered an investment vehicle? I would classify myself as Boglehead and I believe in the fundamentals of investing in stocks because in all it's technicality (and given the buy-and-hold strategy), you are investing in a business by owning a part of it which naturally means that you will and do get the returns on it, both in terms of profits (dividen…

A cryptocurrency cannot be put into any traditional bracket of commodity, currency, stock etc. It's a new breed in itself. It has features of a currency, a commodity, a stock and much more.

So is it a jack of all trades and master of none sort of thing? I still see it as a speculation tool and it's grabbing a lot of momentum. But I don't see what's so fundamentally useful about the technology unless you're interested in laundering money and/or buying illegal stuff.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#128

Post by Osiris » Thu, Dec 03, 2020, 5:35 PM UTC

Triv888 wrote: post #119

nostrademons wrote: post #67

Earlier quoted context omitted.

It's analogous to investing money in USD or GBP before those countries were given a license to print as many USD and GBP as they wanted. Before then (1931 for the pound and 1933 for the dollar, though they maintained de-facto parity with gold until 1971), dollars and pounds were considered good investments. That's why we had bank runs: people thought their money would be safer under their mattress, and preferred to o…

Bitcoin specs change all the time and they could decide to increase the supply

Being a decentralized application, certainly the core devs could attempt to make such a change but I guarantee that would cause a fork and the community would decide which fork they want to put their mining effort into.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#129

Post by Mc_Big_G » Thu, Dec 03, 2020, 5:35 PM UTC

phkahler wrote: post #83

nostrademons wrote: post #67

Earlier quoted context omitted.

It's analogous to investing money in USD or GBP before those countries were given a license to print as many USD and GBP as they wanted. Before then (1931 for the pound and 1933 for the dollar, though they maintained de-facto parity with gold until 1971), dollars and pounds were considered good investments. That's why we had bank runs: people thought their money would be safer under their mattress, and preferred to o…

>> Not so with Bitcoin: the total supply is fixed at 21M, forever, and there's no central authority with the power to change that. But as TFA indicates, there are over 500 other crypto coins. When anyone can create a new one they become irrelevant.

Anyone can create a Craigslist clone, but somehow they still make 100s of millions of dollars per year.

Re: S&P Dow Jones Indices to launch cryptocurrency indexes in 2021

#130

Post by misnamed » Thu, Dec 03, 2020, 5:35 PM UTC

JMTQp8lwXL wrote: post #114

phkahler wrote: post #83

Earlier quoted context omitted.

>> Not so with Bitcoin: the total supply is fixed at 21M, forever, and there's no central authority with the power to change that. But as TFA indicates, there are over 500 other crypto coins. When anyone can create a new one they become irrelevant.

Anybody can easily create a coin, but if the coin has no market share or broad usage, it has no practical value. We can make infinite coin types, with each coin type having an infinite number of tradable units; all that matters is adoption. Bitcoin is far more likely to be accepted than a coin you invent tomorrow.

You had it with 'we can make infinite coin types' - who cares about what is adopted today? People change platforms every few years. What happened to MySpace? What's happening to Facebook even now? Where did TikTok come from? There is turnover.