Don't do any technical analysis, trust your guts, short low, buy high, lose all your money, get paid in HN points.
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Shorting Bitcoin
271–280 of 334 posts
Re: Shorting Bitcoin
#272Earlier quoted context omitted.
Tezos is amazing, it has upgraded itself entirely through on chain voting governance 6 times. No drama, no crazy rollouts. Tezos smart contract ecosystem has grown to 10% of Ethereum and it's gas prices are pennies (and will continue to be). Ah if the market was logical.
Commodore and Macintosh were superior to the IBM PC. still, the PC was the leader tech of the 80s and 90s.
True, but the difference here is that the crypto market is purely speculation driven at the moment. tezos is doing fine adoption wise: https://better-call.dev/stats/mainnet/general
As long as adoption increases it will be fine in the end since all that money that PoW chains spend on those power plants and GPUs goes straight into the pockets of Tezos holders. And the foundation has enough money to support the development for a decade or two.
Re: Shorting Bitcoin
#273He's betting on prices going down at the end of the current 4-year Bitcoin cycle, which they historically have done. This is just trying to guess when it'll happen. Betting against Coinbase, an exchange, is a bit foolish as exchanges make money every time there is a trade, up or down. Their income is unaffected by market crashes, may even go up. That detailed dig into the past of MicroStrategy is interesting... but I…
actually coinbase’s revenue tracks pretty well to bitcoins price. as when the price crashes people lose interest in it and volume goes way down. this is basically what happened between the end of the last bull market and the start of this one and the same is true for robinhood with stocks. bull market attracts more investors trying to get rich and drives volume. in turn when it crashes the volume dries up as retail l…
I am not surprised to learn that, but I will still maintain that exchanges are fairly immune to the fate of the securities/commodites/assests traded on them. Crypto today is a more complex, evolved sphere than four years ago and most of the value is not in the price of this or other coin/token but in the smart contracts. Which is something that Bitcoin does not have, but for some reason people see it as a valuable asset.
Re: Shorting Bitcoin
#274I 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…
Eh. Brazil (the government! same one that botched the response to Covid) instituted an universal mechanism to wire any amount of money instantly for free — there goes your use case, not to mention Venmo, etc. Of note: INSTANTLY. You can pay a random handyman you need in an emergency, or split bar tabs, or pay out-of-pocket expenses with doctors, whatever. I use it in lieu of credit cards for e-commerce too. https://w…
That's interesting - can you use it to send me a little money over the internet?
Bitcoin isn't good for this either any more, but litecoin, monero and bitcoin cash all work well.
Re: Shorting Bitcoin
#275Earlier quoted context omitted.
> Puts are fine but the swings will often get you liquidated if you use too much leverage. Isn't that the same as saying "swings will often get you liquidated if you use too much leverage"? Whether puts or whatever else, if you use too much leverage, swings will often get you liquidated . Also, I don't think the author used any leverage. He just bought puts.
Yes puts or calls can get you liquidated by swings. I was trying to get across that a lot of people are using high leverage right now to get-rich-quick and, especially in the crypto space, it is risky to the point of being unwise.. unless you have an edge with backtested, medium-term models that adequately account for the wide range of volatility, with automated take-profit / stop-loss in place.
> Yes puts or calls can get you liquidated by swings.
No, when buying puts/calls, you can't get liquidated by swings. The worst that can happen is that they expire worthless.
They could get liquidated if you borrowed money to trade them, but that's not in the nature of the put/call, that's in the nature of borrowing money to trade.
In this specific instance, I understand the author bought puts with actual money, and there's no way he could get liquidated by whatever swing.
Re: Shorting Bitcoin
#276Earlier quoted context omitted.
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…
You misunderstood the terms. Economically Durability refers to an asset that doesn't decay with time. Historically, things like cows, sheeps, wheat and other things were used as money. Those things are not durable: they rot or are consumed. Gold, silver, paper/fiat money and BTC are durable.
Portability refers to the ability/costs to transfer your money from, say, New York to Singapore. Transferring USD is cheap and easy, but transferring BTC isn't expensive either. Specially when compared to transferring cows or a gold bar.
Storability is somewhat related to durability: you should be able to store your money, forget about it, and recover it later without loss. Think of burying gold and coming back for it in five years: all your gold is still there. Wheat seeds or cows not so much. BTC is perfectly storable: the very first mined BTC would be the same BCT for years to come. I would say that paper money loses against BTC and gold in this concept, but then again, fiat money works exactly like BTC.
Losing your wallet is another concept not related to storability: you can also lose a gold coin or a $100 bill.
Re: Shorting Bitcoin
#277Earlier quoted context omitted.
Is he underwater? Aren't the put options that he bought previously just not cheaper now? On options being underwater: "Underwater stock options have an exercise price which is greater than the market price of the underlying stock." Is that his situation?
To be "short" you can sell borrowed equities, sell calls that you write, or buy put options. Buying put options will cap your risk at the option price (I think underwater just meant "lost lots of money" - more likely to go out of bounds with the first two kinds of short positions)
Sorry, but no.
Those three are all 'bearish' strategies, but "going short" is selling something you don't have. Buying put options isn't short selling, although both are anticipating a decrease in the value of something.
Underwater is the term for a contract or asset that is worth less than its notional value.
https://www.investopedia.com/articles/trading/092613/differe...
Re: Shorting Bitcoin
#278Earlier 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.
Every bank will reimburse you in the event of getting hacked or fraudulent withdrawals (to varying degrees), so withdrawal limits reduce their liability. Bitcoin doesn't provide any protections in the case of your money being stolen, so it doesn't impose any limits. Depends what you prioritise I suppose.
No they don't. They will weasel out of reimbursing you any time they can.
Looking at you, BBVA.
Re: Shorting Bitcoin
#279Earlier quoted context omitted.
To be "short" you can sell borrowed equities, sell calls that you write, or buy put options. Buying put options will cap your risk at the option price (I think underwater just meant "lost lots of money" - more likely to go out of bounds with the first two kinds of short positions)
Sorry, but no. Those three are all 'bearish' strategies, but "going short" is selling something you don't have. Buying put options isn't short selling, although both are anticipating a decrease in the value of something. Underwater is the term for a contract or asset that is worth less than its notional value. https://www.investopedia.com/articles/trading/092613/differe... https://www.investopedia.com/terms/u/underwa…
Thanks for the clarification. I used "short" in quotes as that was the article terminology.