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Shorting Bitcoin

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Re: Shorting Bitcoin

#301
post #156

Earlier quoted context omitted.

Bitcoin, like tesla stock is better predicted by treating it as a religion than a rational investment. So how long are people going to believe a kid who said a god knocked her up to avoid getting stoned?

> So how long are people going to believe a kid who said a god knocked her up to avoid getting stoned? What you say does not make much sense. When Jesus came to Nazareth as a grown man, this is what His neighbours said about Him: “Isn’t this the carpenter’s son? Isn’t his mother’s name Mary, and aren’t his brothers James, Joseph, Simon and Judas?" (NIV Matthew 13:54). And a few verses later: "And they took offense at…

> Jesus became known as our Saviour because of His (...) resurrection

There is no evidence for this except what is told in the Bible. Which is the whole point, you are one of those irrational people who are holding onto an irrational asset (Religion). That asset has value to you since others are holding the same asset, if there were no others in the world who believed in the Bible then you wouldn't believe either. So shorting Bible belief could seem rational, it is bound to die sooner or later, but likely it wont die in the next 10 years.

And just to illustrate, a rational belief is belief in something like newtons laws of physics. Although they aren't 100% correct they are still useful for solving many problems so they will likely survive as long as humanity exists. The main difference is that the laws of physics has value even if you are the only person believing in them. Similarly Amazon stock has value even if nobody else wants to buy them. But bitcoins just like the Bible has no value if others doesn't believe in them.

Re: Shorting Bitcoin

#302
I disagree with his beliefs. I think a few of the beliefs he states for his reasoning are incorrect. Incorrect input leads to incorrect output.

Kudos to him for putting his money where his mind is, but frankly when he learns more about bitcoin and his incorrect beliefs are shattered, I'd imagine his conclusion would be altered as well.

Re: Shorting Bitcoin

#303
Coinbase is not BTC only. The crypto market cap is growing exponentially since 2015

Today BTC is only 46.3% of the total market cap,

BTC is proof of work, while the future is proof of stake.

The crypto market is growing very fast and it is changing very fast too.

https://ventures.coinbase.com/

Re: Shorting Bitcoin

#304
post #303

Coinbase is not BTC only. The crypto market cap is growing exponentially since 2015 Today BTC is only 46.3% of the total market cap, BTC is proof of work, while the future is proof of stake. The crypto market is growing very fast and it is changing very fast too. https://ventures.coinbase.com/

To rephrase an old saying: "When BTC sneezes, the crypto market catches a cold"

Re: Shorting Bitcoin

#305
post #303

Coinbase is not BTC only. The crypto market cap is growing exponentially since 2015 Today BTC is only 46.3% of the total market cap, BTC is proof of work, while the future is proof of stake. The crypto market is growing very fast and it is changing very fast too. https://ventures.coinbase.com/

To rephrase an old saying: "When BTC sneezes, the crypto market catches a cold"

If BTC sneezes because mining is prohibited, proof of stake cryptocurrency stay health.

Re: Shorting Bitcoin

#306

Earlier quoted context omitted.

> So how long are people going to believe a kid who said a god knocked her up to avoid getting stoned? What you say does not make much sense. When Jesus came to Nazareth as a grown man, this is what His neighbours said about Him: “Isn’t this the carpenter’s son? Isn’t his mother’s name Mary, and aren’t his brothers James, Joseph, Simon and Judas?" (NIV Matthew 13:54). And a few verses later: "And they took offense at…

> Jesus became known as our Saviour because of His (...) resurrection There is no evidence for this except what is told in the Bible. Which is the whole point, you are one of those irrational people who are holding onto an irrational asset (Religion). That asset has value to you since others are holding the same asset, if there were no others in the world who believed in the Bible then you wouldn't believe either. So…

Some great minds in 18th/19th century debated all this in context of rationality. Kant, et al. Some of the discussions were in fact about the "utility" of belief.

As to "rational belief", isn't that an oxymoron? There is 'rational knowledge'. Belief is precisely regarding matters where reason remains mute. Your beliefs and your knowledge are the full content of your world reality.

https://en.wikipedia.org/wiki/Friedrich_Schleiermacher

Re: Shorting Bitcoin

#307
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…

Assuming he's actually doing what he claims.. which we have no way to verify

Re: Shorting Bitcoin

#308
post #179
post #45

Earlier quoted context omitted.

I think hgibbs is confused between puts (a contract for the ability to sell at a price) and shorting (borrowing to sell immediately and buy back later), but your comment isn't quite right either. Shorting has unlimited downside, since it may be arbitrarily expensive to buy back the shares/coins that you borrow. Puts, on the other hand, have a strike price. A contact to be able to sell Bitcoin for $30K is worthless on…

My question was in relation to the parent comments claim that buying puts can cause unlimited losses - I was pointing out that this was wrong. The original comment seems to be edited now

Gotcha. That makes sense.

Re: Shorting Bitcoin

#310
post #212

Derivatives guy here. Perfectly fine opinion, but two issues. Why now? This is a general investing issue. Trading costs money, holding a put costs money, so why will the market do what you think in this time frame? Why are the puts cheap? This could be substantiated with some numbers, esp implied volatility. Are they cheap vs history? I don't know, but the reasoning should show why you think so. Note I'm not looking…

In trading you need a catalyst. A reason for why something will happen in a certain time frame. That's the basic premise for how trading works. If you don't have a catalyst then you are just blindly gambling or throwing your money away. OP gives a bunch of reasons, but no reason why any of that will play out in his particular time frame. So he's not trading. Time will tell if he is gambling or throwing his money away…

Yeah - the closest he comes to providing one is "My best guess is that pretty soon the supply of greater fools runs out." But that's not very scientific.

I suspect the catalyst will be some kind of regulatory action against Tether. But yeah it's really anyone's guess at this stage and as you point out it's knowing the timeframe that is the problem with shorting.

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