Hyperbitcoinization?

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Pajamas
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Hyperbitcoinization?

Post by Pajamas » Tue Jul 10, 2018 9:05 am

Bitcoin (BTC) To Be Worth $100 Million Per Coin By 2030?

https://www.fxempire.com/news/article/b ... 030-514683

If so, how much of my portfolio should I but into Bitcoin now that it seems to have bottomed out around $6k?

adamthesmythe
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Re: Hyperbitcoinization?

Post by adamthesmythe » Tue Jul 10, 2018 9:13 am

My planned allocation of bitcoin is 0%. I will rebalance to maintain 0% according to my plan.

AlohaJoe
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Re: Hyperbitcoinization?

Post by AlohaJoe » Tue Jul 10, 2018 9:14 am

If you think something is going to go from $6,000 to $100,000,000 in the next 12 years then you should put everything in it. You should take out a second mortgage on your home, get a margin loan from your broker, and pile up the credit card debt to buy it now.

I mean, I personally think your link is unconvincing but if you believe it, you should act on it. My financial plans don't require get rich schemes and I don't suffer remorse if someone else gets lucky & rich quick while I get rich slowly but surely.

Jags4186
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Re: Hyperbitcoinization?

Post by Jags4186 » Tue Jul 10, 2018 9:41 am

You could buy 1 bitcoin and be set if it goes to $100,000,000 even accounting for inflation!

typical.investor
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Re: Hyperbitcoinization?

Post by typical.investor » Tue Jul 10, 2018 9:41 am

Pajamas wrote:
Tue Jul 10, 2018 9:05 am
Bitcoin (BTC) To Be Worth $100 Million Per Coin By 2030?

https://www.fxempire.com/news/article/b ... 030-514683

If so, how much of my portfolio should I but into Bitcoin now that it seems to have bottomed out around $6k?
If you put any amount, please do something like the following 10% bit coin - 90% safe (short term bonds), and rebalance.

I'd limit your initial contribution to 5% of your portfolio overall, and not add more ... i.e. play money.

In any case, current bitcoin economics dictate that capacity shortage results in an auction for liquidity that raises costs that bitcoin becomes too expensive as a payment method. While there may be technological solutions in the future, it's absurd to say that bitcoin will be worth that much when it's not clear how the tech will play out.

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nisiprius
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Re: Hyperbitcoinization?

Post by nisiprius » Tue Jul 10, 2018 2:53 pm

"Any headline that ends in a question mark can be answered by the word no."

The value of $100 million per coin is based on the assumption that by the year 2030 bitcoin will "displace legacy currencies and become the only method of value exchange." It's almost a joke that business plans assume that every startup's business plan assume that startup will be able to get 10% of the market, but this one assumes 100%.

It is magical thinking to suppose that giving a name to something--in this case "hyperbitcoinization"--will make it happen. I believe the chances that cryptocurrencies will become the only method of value exchange by 2030 is about the same as the chances that "hyperbitcoinization" will be in the dictionary in 2030.
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Darth Xanadu
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Re: Hyperbitcoinization?

Post by Darth Xanadu » Tue Jul 10, 2018 4:09 pm

It's a good bet, but an even better bet is that by 2030 you will only be able to buy/sell/use bitcoin through Amazon.
"A courageous teacher, failure is."

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Pajamas
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Re: Hyperbitcoinization?

Post by Pajamas » Tue Jul 10, 2018 8:39 pm

nisiprius wrote:
Tue Jul 10, 2018 2:53 pm
I believe the chances that cryptocurrencies will become the only method of value exchange by 2030 is about the same as the chances that "hyperbitcoinization" will be in the dictionary in 2030.
I agree. I would even say that the odds are better that we return to a gold standard. I would not be surprised if digital money becomes the norm, however. In some countries such as Sweden, physical currency is already on the wane. I rarely spend it myself, usually only when credit cards are not accepted, such as at a fruit or falafel cart, or for tips.

spectec
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Re: Hyperbitcoinization?

Post by spectec » Tue Jul 10, 2018 8:52 pm

There should be some room in your plan to allow for "hypobitcoinization" as well.
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers

Iridium
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Re: Hyperbitcoinization?

Post by Iridium » Tue Jul 10, 2018 11:47 pm

From the article:
Dividing the global value of money 1.8Q
It isn't. $1800 trillion is a ridiculously large amount of money to claim. The FED (https://fred.stlouisfed.org/release/tab ... &snid=4472) claims 1.7 Trillion of US currency floating around. Heck, even if you assume that Bitcoin also means the destruction of all banks, so you look at the M2 money supply, that is still only $14 Trillion. Multiply those numbers by a factor of two or three to get world money supply, and you are still not even close. I believe that all publicly traded companies in the world are with less than $100 Trillion (though there could be some subtleties of market cap I could be missing).

Using the same logic (which I have other issues with) with correct numbers, and you are looking somewhere closer to $200,000 to 3,000,000 per coin, depending on whether Bitcoin replaces all currency or the entire banking system.

Nate79
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Re: Hyperbitcoinization?

Post by Nate79 » Wed Jul 11, 2018 12:14 am

And yet no one actually uses it to buy stuff....

gips
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Re: Hyperbitcoinization?

Post by gips » Wed Jul 11, 2018 1:57 am

$60k—who wants to be a billionaire? Seriously, I read an article a while ago by a respected asset mgr who suggested 1% of your portfolio might be appropriate. I decided on .01% and did quite well.

WanderingDoc
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Re: Hyperbitcoinization?

Post by WanderingDoc » Wed Jul 11, 2018 2:19 am

gips wrote:
Wed Jul 11, 2018 1:57 am
$60k—who wants to be a billionaire? Seriously, I read an article a while ago by a respected asset mgr who suggested 1% of your portfolio might be appropriate. I decided on .01% and did quite well.
I'm at .02% 8-)
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danielc
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Re: Hyperbitcoinization?

Post by danielc » Wed Jul 11, 2018 2:40 am

Pajamas wrote:
Tue Jul 10, 2018 9:05 am
Bitcoin (BTC) To Be Worth $100 Million Per Coin By 2030?

https://www.fxempire.com/news/article/b ... 030-514683

If so, how much of my portfolio should I but into Bitcoin now that it seems to have bottomed out around $6k?
I think you are likely to have a higher return if you insead spend $2k to take a trip to Las Vegas and put $4k on black at the roulette.

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danielc
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Re: Hyperbitcoinization?

Post by danielc » Wed Jul 11, 2018 2:59 am

Pajamas wrote:
Tue Jul 10, 2018 8:39 pm
I would even say that the odds are better that we return to a gold standard. I would not be surprised if digital money becomes the norm, however. In some countries such as Sweden, physical currency is already on the wane.
PHYSICAL currency... yes. But of course it's still the same old fiat currency. Sweden just has debit card readers everywhere including most kebab trucks. I would not consider this "digital money"; it's just regular money.

There are a million reasons why cryptocurrencies are useless as a primary medium of exchange. One of them is that blockchain technology, by its fundamental nature (e.g. mining has to be costly), is not physically capable of processing but the most insignificantly tiny fraction of the world's transaction. Think of how many millions of transactions VISA processes every second.

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