Don't do any technical analysis, trust your guts, short low, buy high, lose all your money, get paid in HN points.
Shorting Bitcoin
261–270 of 334 posts
Re: Shorting Bitcoin
#262Earlier quoted context omitted.
2013. 2017. 2021. Three in three.
Correlation isn't causation. Bitcoin's network started January 3, 2009, so its halving cycles are roughly correlated with US presidential elections. Bitcoin is also global, and countries like France (home to Ledger and active bitcoin communities) have five-year presidential cycles. So I don't see a causal link to US politics. However, I do think people falling down the bitcoin rabbit hole help them see the state for…
I never said it's the cause. Just making an observation.
Re: Shorting Bitcoin
#263I 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 not an arbitrary limit, it’s for money laundering risk-monitoring and reporting purposes.
Re: Shorting Bitcoin
#264I 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…
> banks are CLOSED 77% of the time! Need to send a wire? 3/4 times bank will be closed
Wait, what ? I have never, ever been unable to pay (aka: send money) regardless of the day/time. Wanna order that sweet RTX 3080 on amazon at 3 AM on a sunday ? Got you covered ! My business is also able to charge (aka: receive money) 24/7/365. It's a 100% uptime from my POV). Just need the app on my phone.
And usually the confirmation takes less than 15 seconds. The few payments I made with bitcoin took around 24 hour to be confirmed (granted I just said, "** it, I'll check tomorrow" after waiting for a few minutes).
In my whole life, I have seen one (1) single Bitcoin brick and mortar "store" (basically, an ATM behind a glass, and some bitcoin swag). Funny enough, it was closed when I was there because I was visiting on a sunday. Compare apple to apple and oranges to oranges.
Re: Shorting Bitcoin
#265Earlier quoted context omitted.
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
> or fractional reserve banking
Which is why deposit insurance exists, regulated and mandated by governments. Bank regulators also impose audited capital requirements, reducing the risk that an illiquidity problem (a bank run) becomes an insolvency problem.
Tether has no such guarantees. Since it holds cash and cash-equivalents at far less than a 1:1 ratio compared to its liabilities (issued Tether), participating in the Tether ecosystem is placing an implicit bet that Tether's collateral will remain sound. If it doesn't -- for example if its commercial paper loses value -- then a run on Tether can indeed cause insolvency.
Re: Shorting Bitcoin
#266I 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 terrib…
> The crypto business may adjust and make itself even more accessible to a larger "fool pool".
I’ve been seeing more and more ads recently from various companies advertising how easy it is to open an account to trade crypto and I think this is the reason.
Re: Shorting Bitcoin
#267Earlier quoted context omitted.
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 a…
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Re: Shorting Bitcoin
#268This is how to lose money with shorting 101. You should never base your shorts on solely rational points (long-term rational points, even worse) when going short on bubbly assets. Things like "Bitcoin is not a viable payment method, it's centralized, possibly manipulated, fueled by the greater fool" is not a valid shorting motive unless you have a triggering event caused by your aforementioned rational point.
My thesis for longing/shorting BTC at this point is purely Elon Musk's tweets
Sure he tweets every time he pumps it up but are you confident he’ll give you (and all the rest of his followers) a heads up before he dumps it? I wouldn’t be. And for that reason alone it’s a fatally flawed investment strategy.
Re: Shorting Bitcoin
#269Earlier quoted context omitted.
If it's so biased and opinionated, what is its value to HN readers? Is there any merit to his opinion? Is there any proof?
I don't know what other people found interesting, but personally I found it mildly interesting to see the reasoning about choice of financial vehicles to "short bitcoin" without actually literally short-selling bitcoin. The author's opinion about bitcoin is neither here nor there.
I agree. One of the problems with betting on the decline / collapse of an asset is finding counterparties that are likely to pay up if you win (a problem that some investors faced in 2008, e.g.), and while you may quibble with the author's investment thesis that there will be a decline / collapse, I think his choice of counterparties is quite sound.
Re: Shorting Bitcoin
#270I 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?
One possible difference is that there seem to be an awful lot of supposedly "safe investment" offers out there promising outrageous interest rates for short term loans. I'm not keeping a particularly close eye on that market, but I don't recall that being mentioned in past years, and it would seem to be a sign of the bottom of the sucker pool being scraped.