Hey guys, bitcoin is about to pass $10,000 USD
Mark Oates

Might want to follow along:




This is a bubble, but it is hard to say when it will burst... But when it does, I will go short. ;)

Chris Katko

I pass $10,000 every night on the toilet.


Bitcoin is something that I wish I knew more about and was involved in it, but out of caution I try to approach it by first learning how it all works and reviewing best practices, and after I've opened 20 tabs I go play CSGO for the rest o the night and then a few days later garbage collect the related browser tabs that I don't have the energy to read through, Bitcoin being among them.


It's clearly a bubble.

Sure, it might reach $100,000 before it bursts. So until then, you can make a lot of money from it. As long as there is a greater fool to sell to. But at one point, the world will run out of fools.

Bruce Perry

Why is it clear that it's a bubble?

I don't really see any problem with traditional money in day-to-day life, but I found this, and some of the points could make sense - as noted, the Greek certainly did have a problem with traditional money recently.


One source said there are approximately 16,698,024 bitcoins in existence so far. At $10k USD that means approximately $167B USD in total worth. That doesn't seem like a problem. I don't know that the bubble should ever burst unless the technology is hacked. Otherwise, it should remain under control, anonymous, untraceable, and therefore very valuable as currency. What will be interesting is how it is or isn't affected by world markets.


Its value is far too unstable to be considered a currency. I agree with my government's assessment of it being more relevantly considered a commodity.


Why is it clear that it's a bubble?

Sound reasons for the existence of a thing is not the same as sound reasons for the value of that thing.

There were good reasons for internet companies in the 90's. They turned out to be overvalued, but the internet itself was sound.

There were good reasons for growing tulip bulbs in the 1600's. They turned out to be overvalued then, but Holland still exports tulips today.

The question you have to ask is: do you think people are buying bitcoin right now because they want to buy something with it? Or are they buying bitcoin in the hope to sell it again for a higher value? If it's the latter in the majority of cases, then: bubble.

Chris Katko

I thought it was obvious it was a bubble... the only people using it are hobbyists/fringe-early-adopters/novelty seekers... and illegal as hell people.

Bitcoins will be regulated by law. And the second they do, all the advantages disappear.

Additionally, everyone charges money to use their bitcoins. So what's the point? Bitcoin was only better than dollars/etc because you wouldn't be paying tax (good luck), and paying conversion fees/credit card fees every transaction. Except bitcoin fees often far exceed the comparable bank or credit card.

I'll admit, I've never thought Bitcoin was an amazing idea, so maybe there's some super advantage still I don't know of. But I've never heard anyone really take it seriously other than those fringe types... and drug dealers.


The tech changes the world.. Bitcoin was at a bubble at $1000, it burst to 200. Now look at it again. It'll gain hundreds percent more, and it will lose tens percent.. It's a really wise idea to keep some of it in a regularly rebalanced portfolio(a passive way to sell high, and buy low).

I regret not buying it for $1 of course, when I first heard about it, here on A.CC. It was maybe a decade ago. But well, i put $1500 in to cryptos this spring, and now my crypto portfolio is worth 8200$. It's a diversification, and I don't plan to let it exceed maybe 15% of the value, and I don't plan to add additional money.

But the point is that due to actual changes occurring in the world, it would be weird to think some new abstract value won't appear: we have gold. It's quite useless, but people just agreed it'll be valued. So BTC has all the values gold has, and few extras.. Easier to divide, easier to store. Absolutely limited in quantity(unlike gold). Hence its great store of value. Why BTC, and not something smarter? Cos' BTC is first. Another thing, is that if someone new to appear, it is likely to appear like Bitcon Cash: it'll fork from Bitcoin, and everyone BTC owner will have some of the enhanced currency. Why? Because otherwise go persuade people to buy your stuff, they'll all know you do this for ur own riches.

In other words, BTC will stay volatile for a good while. But I do think it's likely to replace gold in portfolios, int he very long run. Or at least to stand near gold in diversified portfolios. & yes, I don't think $100k is the limit.

The stock exchange is majority of my income for the past few years, and its what I do for living(picking stocks, pretty much Russian ones). But I do think cryptos, and mostly BTC have great future, I got no plans to try to get rich with it though. Just an instrument for diversification.

Bruce Perry

I see, amarillion. That bubble argument makes sense. I learnt something about economics today :)

I've always had a bad feeling about the act of trying to gain money by playing the system instead of by creating something, incidentally.

Gideon Weems

I've always called that feeling a conscience.


15500$ :D

My initial investment of $1500 turned in to 10 000 today.



type568 said:

we have gold. It's quite useless, but people just agreed it'll be valued

Gold is pretty much the best corrosion-resistant conductor we have. Every cell phone contains 0.50USD worth of gold.

There's not really that much gold. In total less than 200 000 tonnes mined gold in the world. It's super rare and easily malleable, making it an excellent tender for the past times before the invention of paper money. Granted, its intrinsic value as a conductor came later.

bamccaig said:

Otherwise, it should remain under control, anonymous, untraceable, and therefore very valuable as currency.

The problem with bitcoin is that it's horribly inconvenient as tender because the system doesn't have, and due to its design never will have the capacity to process any significant amount of transactions making it useless as a currency. It solely exists as a speculative investment instrument and a way of making shady deals.

Bitcoin isn't untraceable either. The blockchain is a public ledger and every transaction can be traced back to a wallet, by anyone.

Also, any vendor records that link transactions to users can compromise the anonymity of wallets identified within. So yeah, you can pay a pizza with bitcoin instead of cash, but if the pizza place has surveillance cameras, there goes the anonymity of your wallet.


Well, seriously - gold's value isn't in its conductivity properties. How much of the 200k tonnes you mentioned are used this way?

I totally agree with you bitcoin is a shit currency, more than this I believe there is no sense to make any centralized blockchain transaction system.

But today gold is a shit payment method as well, and isn't suitable for this. Nevertheless, an investor can buy & sell gold when he desires. So one can do with a Bitcoin. However, Bitcoin is easier to store, to transfer. You're even more confident regarding its rarity than you are with gold.

And.. Everyone heard about it, its first in it's kind. If there is a need to fork it - original owner owns a piece of that thing(like bitcoin cash popped up). In other words, the cryptos are a wonderful investment hedge instrument, as well as gold is. It's new, technological.. And is more convenient than is gold. Tulips were really inferior to gold, in many aspects. Bitcoins are superior, probably first thing that can compete with store of value with gold(i'm not talking about income generating instruments like stocks, debt instruments, estate/land etc').

I think bitcoin has a great future, nevertheless - i'm very risk averse, and invested a small fraction of capital with it. But holding about 10% in it makes sense. Now I've some 8%.

Rodolfo Lam

About 3 years ago I bought 25USD in Bitcoin just to test the system, and haven't touched them since... They are worth around 210USD right now, looks like good ROI to me, wish I had taken the plunge and bought more :P Would have definitely sold them by now if that had happened.


Yeah, I'm sure there are many people bought cheapily, and now are sad cos' they sold it too early. The way to go to be calm, is portfolio rebalancing: e.g. keeping ~10 in Bitcoin. This way you pull out as it grows, and buy a little as it plunges. The more volatile is the instrument, the more income such approach generates.


Not listening to Mark has been one of my biggest mistakes. :'(


If only I'd have known it could have made it all the way to $50... ;)


I bet you wish you invested $23 000 in to it then.. ;)


I'd be happy if I had invested $23 into it then and forgot about it until just now :P

Chris Katko

My main reservation with Bitcoin has always been:

  • Difficulty in finding reliable sources to "purchase" Bitcoins from (mining it was never practical for me).

  • Difficulty liquidating Bitcoins if I ever did decide to sell.

It's ultimately the same thing that makes me wary of stock market and other such investment opportunities. There's no such thing as gratis "money". As quickly as the price jumps it can fall, and it seems reasonable that the market could respond to my (and probably many other) people attempting to sell faster than we could sell.

In other words, a bit of a paradox. As long as you wish to save your investment it can gain value. As soon as you decide to try to turn your so called "win" into actual profit the value can drop as a response. Is that not basically the very nature of these kinds of things? Particularly where you can't just immediately complete the transaction on demand.

Bruce Perry

Do what I do - stick to creating value for people :)

Of course I sometimes feel drawn to this kind of phenomenon. Everybody likes the promise of free money. I have to tell myself, first what you're telling yourself that it's risky and that money has to come from people who think the same way but are less lucky, and secondly that it isn't creating value for the world and making people feel good about you getting their money in return.


And then you got these types of people that will risk their livelihood on a gamble:


It reminds me a little bit of "skins" in CSGO. Skins are a virtual item which can be traded or bought/sold. For the most part, they have no real function and just serve as decoration for weapons in the game. Their value comes mostly from their appearance and rarity.

You are awarded random worthless skins as you play the game and "level" up from your score. You could also be awarded a "case" that contains a random skin, possibly valuable, but you have to pay $3 for a "key" to open the case and odds are you'll again get a worthless skin in return. Skins range in value from a couple of cents to thousands of dollars.

No matter what it's a losing game: there's no official way to turn a skin back into money in your pocket. Even if you sell a skin to another player through the community market the money goes back into your Steam wallet (i.e., basically credit on the Steam platform). The only way to turn it into real world money is to give the digital items to another player, and trust them to pay you real money in the real world. Many sites are setup to facilitate this kind of "black market" trading, but none of them can ultimately be trusted. You basically have to give these services access to your Steam account/inventory for them to do their job, which means if they are themselves malicious or get hacked they could take any valuable skins as well as hijack your entire account with your library of games.

Lots of people take trading these skins seriously. That's predominantly what they do. They barely even play the game. They just look for trading partners. However, if you get them talking you'll discover that they've never actually made any money doing this. They've all lost hundreds or thousands of dollars trying. Even if they were able to liquidate all of the skins in their inventories they wouldn't break even. It's a gambling addiction and nothing more.

I myself have invested approximately $350 into CSGO skins. Approximately $200 of that was just lost gambling on cases and keys. I was effectively just testing the system out to see how it worked and see if I'd get lucky. Naturally, I didn't. I learned from that and no longer purchase keys for cases. After that I invested in an inventory of nicer skins just because I play the game a lot and it's intimidating if other people have flashy skins and you don't. Most of my skins were only 10 or 20 cents. A few were $10 and one was $90. These were conscious buying decisions knowing that the money was effectively being burned. However, I play CSGO a LOT so I decided to invest in it so that I could enjoy myself more.


I understand if the in-game purchase has a functional purpose (ie. buying packs in games like Mass Effect, I still don't spend real world money on it), but for something purely aesthetic, I just don't see the appeal.


I agree. Generally speaking, something purely aesthetic is a waste. I held off on using skins in CSGO for probably 6 months or so. But what I found was that I was intimidated by enemy players that had fancy weapon skins. It made them look experienced and me look brand new. It was psyching me out. I decided to try to find skins too so that I could intimidate instead. The other thing that it does is attract praise from players that are envious of your inventory. It can help to boost your image, which again plays into intimidation.

My skins aren't only aesthetic. I only use "Stat Trak" skins, which pretty much just means they have a kill counter on the weapons. Each of my weapons keeps track of kill counts, including my knife. Again, it doesn't actually give you any direct advantage over other players, but it's a bit fun to see how many kills you have. It also works as an intimidation tactic if enemies see how many kills you have on some weapons. Plus it helps you to learn which weapons you're strongest with. My AK has about 4000 kills right now. The closest contenders are my M4A1 and AWP at maybe 1500 or 2000. Obviously, I'm much better with an AK than anything else that I regularly use. :) My knife has over 500 kills on it.

bamccaig said:

I play the game a lot and it's intimidating if other people have flashy skins and you don't

Sorry, but this is hilarious. ;D

Do you feel the same way if you're not wearing the latest fashion accessories? :P


Do you feel the same way if you're not wearing the latest fashion accessories? :P

If I encounter a person that is covered in tattoos I find it intimidating certainly. Similarly, a man with appropriate earrings and perfect hair and bright, smooth clothes also sends a message to my brain that they're confident and strong. It looks like there's a purpose to their appearance. They worked at it.

It's probably mostly psychological, and the people that care to do this probably have figured out that they can control people's perceptions of them and manipulate people in doing so. I cannot much be bothered to do that myself (couldn't if I tried), but obviously it is achievable and worthwhile for some.

This is how I picture you from what I know of you, though I'm not sure if I've ever seen pictures. I don't imagine that you just throw on a wrinkled T-shirt and sweat pants when you leave the house (I pretty much do).

Insert: I don't actually agree with "fashion" trends though so fashion by itself doesn't interest me. Until I met my finacee I used to dress completely backwards to usual fashion trends. Big, baggy clothes that were 4 sizes too large. Most people wouldn't have actually appreciated it. I didn't do it because other people thought it looked cool. I did it because I thought it looked cool, or because it gave me confidence. Now my finacee mostly chooses my clothes for me, and her liking it gives me confidence too since I know that other people like it. I would never have chosen it myself though if I went shopping alone (and I force her to find a balance that is comfortable for me).

But my intimidation from CSGO skins isn't because they're "fashionable". The interpretation was my own. It wasn't because other people were talking about it. It was because I was envious of it myself. If it's something that you don't know how to have, or cannot afford, then it is obviously something to be envied. At the time, I didn't know how to attain it. And even now that I do know, much of it is still out of reach because of the insane price tags (rarity).

Note that in CSGO there is no body language. Everybody takes the form of a few stock avatars and inherits their animations. The only differences are their actual play styles, and the skins they choose to have. The skins are actually valuable too, so you know that somebody that has really nice ones is either quite wealthy, extremely lucky (probably not), or sponsored.

My skins are impressive to the lower ranks and guys that have never dabbled in skins, but in reality most of them are dirt cheap and anybody could have them if they wanted to (except for kids without a credit card nor open minded parents). There's only a few skins that actually cost real money, but even those are affordable for any adult with a job. The really really nice skins are an insane investment. I'm talking about like $400 to change the appearance of your weapon in game. It looks awesome, but is otherwise pretty useless. These transactions are real things, and people really buy them for this kind of money.

I bought my knife for about CAD$90 about a year or so ago. Like most of my skins, it's pretty much the cheapest "Stat Trak" skin I could get, but knives are just more expensive because they're the "elite" weapon (i.e., respected because it's difficult to succeed with one). Looking at the price of the same skin now it looks like it might be worth about USD$90. That's about CAD$115 right now. So in that sense, my investment has actually gained value. Of course, as mentioned, I really cannot liquidate it back into cash. However, I like it, and it does get quite a lot of attention.

I've had countless people add me as friends on Steam only to make offers on it. Guys have offered to pay me $300 for it. However, as a precaution, I refuse all trade offers. Typically these kinds of offers are made on the "black market" i.e., outside of the Steam marketplace. Guys will offer to pay with e.g., PayPal or through third party sites or services. You can't trust those deals so I just avoid it out of caution. Honestly, why offer me $300 for a skin you could buy on Steam marketplace for 1/3 of that, unless you plan to scam me. And many people have been scammed by these kinds of deals.

It's ridiculous, and yet, it is very satisfying. The knife skins are the best ones. Not only do they change the appearance of the weapon, but they also change the shape and animations. They are effective in that sense. On the other hand, I don't much enjoy going "out" or doing the things that most other people do and spend countless money on. I predominantly play CSGO with my free time (I have logged 2441 hours in a little over 2 years). I could spend this money instead on other games, but I'd never get that kind of value from it (~$300 for almost 2500 hours and counting!?). It's actually not a bad investment when you think about it. A lot better than several items in my Steam library or in the real world that I regret purchasing.


And of course, I'm sure there are things that you spend money on that I would find ridiculous. Whatever makes you happy. :)


While we were talking bitcoin almost doubled again... It's insane, but the thing is no one knows when the crash will come...

Chris Katko

I've heard people are manipulating it with the usual "dump-and-pump" tactics, and maybe others. I'd be careful to rely on it's value and up-rise.

But yeah, if you've got money and don't mind pissing it away (like gambling), then, hell yeah.


If you think about the kind of money that Bitcoin represents, there's absolutely no possible that it could all be converted to another currency. If everybody decided to sell Bitcoin tomorrow it would take forever to exchange it, and the value would drop so fast that it would drop below a USD before the last people were able to sell. In fact, the "banks" setup to convert Bitcoin would be forced to close. It's kind of crazy. A cryptocurrency sounded like a brilliant idea a few years ago, but now I wonder how it could ever be stable. It doesn't seem anybody has figured that out yet.


All currencies in use have the same "problem". ::)

If everyone were to cash it out all at once the currency would disappear.

Take the Canadian Dollar, for example. If everyone who has Canadian Dollars converted their Canadian Dollars into United States dollars, the Canadian dollar would be worthless. It would drop so fast the last few would trade for less than $0.001 USD.

The only thing that gives any currency value is the belief/trust in it, and subsequently the use of that currency. BitCoin is no different.

Chris Katko
Derezo said:

All currencies in use have the same "problem". ::)

Except Bitcoin exists solely to be used for other things. I don't know the proper word for it, but nobody wants to "hold on" to bitcoins forever like a currency. It's more like a stock than a currency. Almost everyone using it is using it to generate more "real" currency. Nobody is farming wheat for bitcoins, and retiring on bitcoins. It's more like "you have this super risky stock" and when you retire you cash it out. If someone converted their whole livelihood from dollars to bitcoins, anyone would call that person insane. But dollars to euros, not at all.

People own bitcoins solely for the purpose of cashing them out. So whoever does it last... looses. Which sounds a lot like a pyramid scheme.

"If" everyone left the US dollar, I guess it would have no value. But 99% of normal people don't want to ever leave the dollar. So maybe the key difference is solely of the usage intent of the masses?


Bitcoin exists solely to be used for other things.

Not sure what you mean by other things? Like, stuff and junk? :-/


I don't know the proper word for it



It's more like a stock than a currency.

Some countries treat it as a currency, some countries treat it as a commodity. This is still being debated and differs wildly and may even be illegal to possess in some jurisdictions.


People own bitcoins solely for the purpose of cashing them out.

People do this with other currencies as well, but that is not the only reason people use it. Nor is it the sole reason people use Bitcoin. I think you misunderstand the purpose of Bitcoin, you should watch a few documentaries. There are some on Netflix or YouTube.

You can use Bitcoin to buy goods and services like any other currency, but also like other currencies not everyone will trade you for it. You can't bring your Colombian peso's to the corner store and expect them to accept them, but that doesn't mean they aren't currency.


By the way, bitcoin fell over 5000 dollars today. Just as I expected. Too bad I didn't find a viable way to short sell in time...


Well, afterwards it touched 16k, and now it's 13200. I think at time of your writing it was probably around 11-12k.

It can be shorted on CME.. Lots of 5 BTC. The problem with it is that you can never guess where will it go. Only more or less reliable way to profit from swings is to keep a share of your cash in it, let's say 10%. Then if it falls below 5% share of your portfolio, you buy the missing 5%, to make it 10%. If it is exceeding 20% - sell it to have 10% in it. Never buy more than twice in a quarter.

Generally this algorithm can help you profit from any idea you believe in. If the other 9 items are other instruments which occupy 5-15% of your portfolio, and don't trigger an action - the one that has trigger sucks some cash from the other investments, or adds some cash to them evenly, or maybe sucks bit more from bigger positions, bit less from smaller ones.


The key to playing bitcoin, and is the only way to not sell it after 1000s percent of gain is to always keep a share in it.

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