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Shorting Bitcoin

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Re: Shorting Bitcoin

#101

Post by ur-whale »

a) Bitcoin price is extremely volatile, even on a 6-month time horizon, and IMO, given the volatility, this bet is a pure casino play: most of the rationale he puts forward has absolutely no reason to come to fruition within the next 6 months. The OP better pray he's not going to urgently need the money he parked in those puts any time soon.

b) On a longer (years) time horizon, historical trend is telling a clear story: shorting Bitcoin is a very dangerous proposition.

Whether you are long or short on Bitcoin, only play with money you can afford to lose.

Re: Shorting Bitcoin

#102

Post by gregopet »

xvector wrote: post #65
jonny_eh wrote: post #54

Earlier quoted context omitted.

> Cryptocurrency is a beautiful technology On the surface, ya, but the proof-of-waste at its centre should be reason enough to consider the technology more harmful than not.

Thankfully most cryptos are moving to proof-of-stake.

Proof-of-stake is basically an oligarchy though, those with funds call the shots, similar to the current mainstream system but without any of the checks and balances (they will be developed for crypto, too, in time, but at a high price for the early small adopters). Another example of crypto not really being that special in the end, if it wants mass adoption - you can ignore the boring realities as long as it's just used by a relatively small club.

Re: Shorting Bitcoin

#103

Post by mojuba »

paxys wrote: post #55

I agree with basically every word in the article, but would never ever short Bitcoin. Simply because the market can remain irrational longer than I can remain solvent. > When will it happen? I dunno. I’ll be astonished if we get through 2021 without an explosion. Everything he wrote was also true in 2020 or 2019 or 2018 or 2015, and yet there was no explosion. Why does he think Christmas 2021 will be different?

Almost everything except maybe the "fool pool" running out this time? Although even that is hard to speculate about. The crypto business may adjust and make itself even more accessible to a larger "fool pool". There's still a lot of money in the world that's in the hands of people who literally don't know what to do with it. Just create a sort of a Western Union for bitcoin and go to poorer countries... What a terrible, horrible idea that unfortunately might work.

Re: Shorting Bitcoin

#105

Post by mdoms »

breck wrote: post #43

I love this sort of thing. He’s making a bet, explains his reasoning, and does it in the open! That’s great. I disagree that there’s no tech here. IMO public ledgers that never sleep are far superior(thanks to the hard work of many people over the past decade), and their advantage over retail banking will only increase. My online banks keep getting worse, crypto keeps getting better. Think about this: banks are CLOSE…

> My online banks keep getting worse, crypto keeps getting better. Think about this: banks are CLOSED 77% of the time! Need to send a wire? 3/4 times bank will be closed.

This is a very American perspective. It's not like this in most places. And even if it was, Blockchain isn't the only solution. By far.

Re: Shorting Bitcoin

#106

Post by arcticbull »

otherme123 wrote: post #97
arcticbull wrote: post #62

Earlier quoted context omitted.

It's best modeled as a speculative asset. It has none of the hallmarks of a good currency. It's not fungible, it's not predictable, it's not cheap to exchange and its value flails around wildly like a decapitated chicken. That's even before you get into the Keynesian vs. Austrian argument that IMO should be long since settled but apparently, here we are.

You are making up the qualities of good currency, and then conclude BTC has none of them. Qualities of good money are 1) Durability (not losing value with time), 2) Portability, 3) Scarcity (limited supply), 5) Divisibility, 6) Acceptability and 7) Storability. BTC has all of them except maybe 6). And I'm no defender of BTC, I don't like it and I don't think it will ever be the main currency. It will be at best like…

C'mon now BTC certainly doesn't have (1) it's down 50% in the last month. I'd quibble with (2) because portability does imply a low cost of portability which compared to USD it does not have. (3) It has. (4) It has. (5) It definitely isn't broadly accepted and (6) it's not great at either, just look at what percentage of the coins have already been lost. 20-30% in a decade. Every random walk down the time line leads to 100% of coins lost.

Re: Shorting Bitcoin

#107

Post by ur-whale »

vmception wrote: post #58

Someone that was predicted to own 5% (1mm) of all Bitcoins just died in Costa Rica I doubt they had a survivorship and secession plan for their bitcoins and I doubt Bitcoins become less scarce Shorting Microstrategy and Coinbase via puts are good ideas though. Microstrategy isnt overleveraged yet but its easy for them to be. Coinbase is just a share dump, thats the entire purpose of direct listings. This has nothing…

> I doubt they had a survivorship and secession plan for their bitcoins

You're speculating though. Any information to back that up?

Re: Shorting Bitcoin

#108

Post by dkarras »

Shosty123 wrote: post #53
breck wrote: post #43

I love this sort of thing. He’s making a bet, explains his reasoning, and does it in the open! That’s great. I disagree that there’s no tech here. IMO public ledgers that never sleep are far superior(thanks to the hard work of many people over the past decade), and their advantage over retail banking will only increase. My online banks keep getting worse, crypto keeps getting better. Think about this: banks are CLOSE…

My online banks keep getting worse, crypto keeps getting better. That resonates with me after my bank shut down my ability to transfer money (via eTransfer) because I hit their arbitrary $20,000 limit for the month. I had to wait THREE weeks before I could send another transfer.

It's also worth reflecting on the fact that banking being terrible is predominantly an American problem among the developed nations. Even in 3rd world countries, banking is pretty awesome. Checks have been obsolete for decades, any kind of money transfer takes around 5 seconds after you press send from your bank's app, even during weekends and between different banks. Transfer limits are generally settable from the apps as well. Worst case they sort you out through phone immediately. Waiting for 3 weeks for something like that is unheard of where I live which is a developing country.

Re: Shorting Bitcoin

#109

Post by _trampeltier »

breck wrote: post #43

I love this sort of thing. He’s making a bet, explains his reasoning, and does it in the open! That’s great. I disagree that there’s no tech here. IMO public ledgers that never sleep are far superior(thanks to the hard work of many people over the past decade), and their advantage over retail banking will only increase. My online banks keep getting worse, crypto keeps getting better. Think about this: banks are CLOSE…

About the whole GameStop thing, for me the most interesting thing was how old school the whole stock market is. 2 days until you really own the stock?!? And then even some trading companys are just take your stocks and lend it for shorting?!?

Re: Shorting Bitcoin

#110

Post by patricius »

Animats wrote: post #98
tempestn wrote: post #23

I've sold Tether for both USD and CAD without any issue or significant delay. What are the difficulties the author is referencing? (Asking genuinely, not arguing.)

Tether will work until the day comes when there is a net outflow from Tether. Then it will all come apart, because the backing assets aren't all there. Like Madoff's fund.

... or fractional reserve banking
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