Crypto-currencies

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Bitter Clinger
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Re: Crypto-currencies

#91

Post by Bitter Clinger » Mon Jan 08, 2018 6:22 am

Tulip bulbs and beanie babies.

The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants.

Why not just admit that it's gambling and that's the enjoyment? You don't need to fly to Vegas, but the drinks are free once you get there.

Have fun, I hope you do well. If you don't, just remember the house always wins.

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Last edited by Bitter Clinger on Mon Jan 08, 2018 6:25 am, edited 1 time in total.
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Re: Crypto-currencies

#92

Post by Liberty » Mon Jan 08, 2018 8:13 am

Bitter Clinger wrote:
Why not just admit that it's gambling and that's the enjoyment? You don't need to fly to Vegas, but the drinks are free once you get there.

Have fun, I hope you do well. If you don't, just remember the house always wins.
I think most of us understand this is gambling. Judging from what I see, most of What has been invested has been recreattional. So far it's been a fun ride.

Every investment, and any speculation is a gamble. Sometimes the player wins. All I know is The market could take a pretty. Deep nosedive and I could still be ahead.
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Re: Crypto-currencies

#93

Post by Liberty » Mon Jan 08, 2018 8:23 am

rotor wrote:
The Annoyed Man wrote:
The Annoyed Man wrote:Now I’m up $670 since 12/22, and up $181 since 6:30 this morning. A friend of mine made a little over $4000 in the last 24 hours.
It’s up to $723 of profit now.
It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
I don't think you understand what a Ponzi really is. Trading cryptocurrencies is commodity trading, it's no different than pork bellies or precious metals.
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Re: Crypto-currencies

#94

Post by The Annoyed Man » Mon Jan 08, 2018 9:41 am

Liberty wrote:
rotor wrote:
The Annoyed Man wrote:
The Annoyed Man wrote:Now I’m up $670 since 12/22, and up $181 since 6:30 this morning. A friend of mine made a little over $4000 in the last 24 hours.
It’s up to $723 of profit now.
It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
I don't think you understand what a Ponzi really is. Trading cryptocurrencies is commodity trading, it's no different than pork bellies or precious metals.
Exactly.

https://www.sec.gov/fast-answers/answersponzihtm.html (US Gov’t website, so I took the liberty of quoting a larger part of it....)
What is a Ponzi scheme?
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors to create the false appearance that investors are profiting from a legitimate business. [Crypto is a commodity, and is subject to the same kind of market forces that affect commodities trading. There is no fraud, but there are coins which fail to deliver the profits hoped for......JUST like stocks.]

Why do Ponzi schemes collapse?
With little or no legitimate earnings, Ponzi schemes require a consistent flow of money from new investors to continue. Ponzi schemes tend to collapse when it becomes difficult to recruit new investors or when a large number of investors ask to cash out. [In crypto, your earnings are real, and transferable. For instance, Bitcoin has a finite amount that exists. There will never be more Bitcoin than already exists. And yet, if you had bought $100 worth at the beginning, you’d be a multimillionaire in REAL $$ today. There are lots of real-world stories like this.]

How did Ponzi schemes get their name?
The schemes are named after Charles Ponzi, who duped thousands of New England residents into investing in a postage stamp speculation scheme back in the 1920s. At a time when the annual interest rate for bank accounts was five percent, Ponzi promised investors that he could provide a 50% return in just 90 days. Ponzi initially bought a small number of international mail coupons in support of his scheme, but quickly switched to using incoming funds from new investors to pay purported returns to earlier investors. [EVERY single person who buys into cryptocurrency from the very first transaction ever, ANYwhere in the world, buys in with fiat currency from some country or other. Once in, they can trade their existing coins for other coins, and they can add more by transferring more fiat currency into their exchange accounts. But furthermore, NO PROMISES ARE MADE, EVER, about how much you will profit from buying a certain crypto product. Gains are made purely through speculation, based on the value of the technology inherent in a coin which that individual coin brings to the market. This is why Etherium is such an outstanding performer. The technology platform it provides significantly advances the utility of cryptocurrency. Other coins have done well for the same reason, and yet others have failed to perform because whatever tech it was that they offered did not significantly advance the utility of that coin.]

What are some Ponzi scheme "red flags"?
Many Ponzi schemes share common characteristics. Look for these warning signs:
  • High investment returns with little or no risk. Every investment carries some degree of risk, and investments yielding higher returns typically involve more risk. Be highly suspicious of any "guaranteed" investment opportunity. [There IS risk in cryptocurrency. It is on the investor to pick the right vehicle in which to put their money. Some perform, some do not, some do but are sluggish. But ALL of them can crash for short periods, due to sell-offs and profit-taking by big investors.......JUST like in the stock market. Etherium, the coin in which I am most invested, dropped from a high of $1215 last night to $1051 this morning. BUT... $1051 is still $339 higher than the most I have paid for it so far, so I am still about 40-45% ahead of the game. It will probably languish during the morning, and then start back up. The trend is what’s important.]
  • Overly consistent returns. Investment values tend to go up and down over time, especially those offering potentially high returns. Be suspect of an investment that continues to generate regular, positive returns regardless of overall market conditions. [My gains have not been consistent. I’ve even taken brief losses, where it went below the price of my initial buy-in. At that point, I bought more, and I was vindicated in that decision by the market performance.]
  • Unregistered investments. Ponzi schemes typically involve investments that have not been registered with the SEC or with state regulators. Registration is important because it provides investors with access to key information about the company's management, products, services, and finances. [US residents are barred from investing in certain coins, or using certain exchange platforms, unless those platforms are “USDA” approved by fedgov’t.]
  • Unlicensed sellers. Federal and state securities laws require investment professionals and their firms to be licensed or registered. Most Ponzi schemes involve unlicensed individuals or unregistered firms. [US players in crypto are barred from dealing through unregistered entities. See the point immediately above.]
  • Secretive and/or complex strategies. Avoiding investments you do not understand, or for which you cannot get complete information, is a good rule of thumb. [There’s nothing secretive about all of this. The blockchain is a FAR more open book than the stock exchange. Since you devise your own strategies, if you make them overly complex, that’s on you. Fortunately, it’s not terribly complicated strategy-wise to make money this way. You only have to do your homework and invest the time.]
  • Issues with paperwork. Do not accept excuses regarding why you cannot review information about an investment in writing. Also, account statement errors and inconsistencies may be signs that funds are not being invested as promised. [The blockchain, which CAN. NOT. BE. HACKED, ensures that your investments are EXACTLY what you asked for. Furthermore, errors/inconsistencies are eliminated because the blockchain is a distributed ledger, over hundreds of thousands of computers all over the world. The rules say that they ALL have to agree. If one of them doesn’t, it gets cut out until its records are in compliance with all the others.]
  • Difficulty receiving payments. Be suspicious if you do not receive a payment or have difficulty cashing out your investment. Keep in mind that Ponzi scheme promoters routinely encourage participants to "roll over" investments and sometimes promise returns offering even higher returns on the amount rolled over. [There’s no difficulty at all in converting your cryptocurrency back into USD and having it wire transferred back into your bank account.......JUST like I do with my Merrill Lynch account, or other investment accounts I have. Within a few hours or maybe a day, the funds are right there where I can write checks on them, or make ATM withdrawals, etc., etc., and the blockchain guarantees that it was the right amount transferred.]
Last edited by The Annoyed Man on Mon Jan 08, 2018 9:57 am, edited 2 times in total.
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Re: Crypto-currencies

#95

Post by philip964 » Mon Jan 08, 2018 9:44 am

I will plunk down 30 dollars on lotto tickets, but I never got around to buying a few bit coins.

What was the price when this thread started. It seems I remember talking about them when they were 20 bucks. Then they were 200 and of course I would never get them then.

It seemed during the big ransom ware epidemic when you had to pay the bad guys in bit coins they jumped to 1000 dollars. For future reference they got as high as what 17000 dollars (for one bitcoin)

Now I guess its history.

Is it the future or is it the last fool.

I don't think we will ever know.

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Re: Crypto-currencies

#96

Post by The Annoyed Man » Mon Jan 08, 2018 10:08 am

philip964 wrote:I will plunk down 30 dollars on lotto tickets, but I never got around to buying a few bit coins.

What was the price when this thread started. It seems I remember talking about them when they were 20 bucks. Then they were 200 and of course I would never get them then.

It seemed during the big ransom ware epidemic when you had to pay the bad guys in bit coins they jumped to 1000 dollars. For future reference they got as high as what 17000 dollars (for one bitcoin)

Now I guess its history.

Is it the future or is it the last fool.

I don't think we will ever know.
Bitcoin is most definitely NOT history!! It is currently at $14,457.80 (right now, but it could gain another couple thousand $$ in one day easily). Here is a chart of Bitcoin’s performance over the last 12 months. Seeing a trend there? Even the bottoms of its dips are WAY higher than its highs not that long ago.
Image

The thing you have to understand Philip is that you CAN buy fractions of crypto coins. You don’t have to buy a WHOLE Bitcoin. You can buy .05% of a Bitcoin. Your investment will grow at the same rate as a whole Bitcoin, but the gains/losses will be a smaller amount of $$. But as soon as I began to figure out, lo these many (three) weeks ago, I have always counseled friends who have shown interest to buy Etherium first, and use that as your “home base”, because it has been an excellent performer that isn’t going to go away. Once you’ve done that, transfer some of your holdings into Bitcoin if you want, but don’t focus on just Bitcoin; focus on investment strategies without being emotionally invested in any one coin. My investment in Etherium is coldly made.
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Re: Crypto-currencies

#97

Post by The Annoyed Man » Mon Jan 08, 2018 10:11 am

Bitter Clinger wrote:Tulip bulbs and beanie babies.

The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants.

Why not just admit that it's gambling and that's the enjoyment? You don't need to fly to Vegas, but the drinks are free once you get there.

Have fun, I hope you do well. If you don't, just remember the house always wins.

Image
You need to watch “Banking on Bitcoin”, a movie you can view on Netflix. It satisfactorily and directly addresses the “Tulip Bulb” scenario. The tulip bulb debacle lasted less than one year from beginning to end. Crypto has been around for several years now (since 2013 for Bitcoin), and it isn’t showing any signs of tanking.
Give me Liberty, or I'll get up and get it myself.—Hookalakah Meshobbab
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Re: Crypto-currencies

#98

Post by TexasJohnBoy » Mon Jan 08, 2018 10:27 am

Keep in mind that every transaction is a taxable event now. Before the new tax bill passed, some people believe that you could shelter yourself until you transitioned back to fiat through like-kind exchanges. This is no longer the case, as real estate is the only like-kind exchange you can make anymore.
https://townhall.com/columnists/lindsay ... g-n2428153
Don't be the guy that doesn't report, the IRS will come looking: https://www.theverge.com/2017/11/29/167 ... rs-records

I'm using a site called https://bitcoin.tax/ to prepare my reports since exchanges really aren't doing 1099's and such yet; we are in the wild west right now. I, of course, did *not* put any data like SSN in that site, I will simply add it to the PDF and/or import into my tax software.

Also, I'm with you TAM. I got in on a stash of Ripple at $.81 before Christmas -- it was a fun ride to $3.30, but today is not so happy at around $2.50. Ethereum is by far the best currency to buy to move into other exchanges or currencies, very fast network and low fees (when I bought it the network was fast, but I've read of delays recently). Bitcoin's fees are high and the network is slow. Litecoin is also a good one to buy to move around. Litecoin is also what I made my first big return on back in early December.

This is exceptionally volatile, and I wouldn't suggest putting in anything that you don't feel like you can flush down the toilet and be OK on the other side.
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Re: Crypto-currencies

#99

Post by Bitter Clinger » Mon Jan 08, 2018 11:29 am

The Annoyed Man wrote:
Bitter Clinger wrote:Tulip bulbs and beanie babies.

The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants.

Why not just admit that it's gambling and that's the enjoyment? You don't need to fly to Vegas, but the drinks are free once you get there.

Have fun, I hope you do well. If you don't, just remember the house always wins.

Image
You need to watch “Banking on Bitcoin”, a movie you can view on Netflix. It satisfactorily and directly addresses the “Tulip Bulb” scenario. The tulip bulb debacle lasted less than one year from beginning to end. Crypto has been around for several years now (since 2013 for Bitcoin), and it isn’t showing any signs of tanking.
https://nypost.com/2015/02/22/how-the-b ... n-crashed/

Like I said, I wish you nothing but good fortune! :cheers2:
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Re: Crypto-currencies

#100

Post by rotor » Mon Jan 08, 2018 11:43 am

Liberty wrote:
rotor wrote:
The Annoyed Man wrote:
The Annoyed Man wrote:Now I’m up $670 since 12/22, and up $181 since 6:30 this morning. A friend of mine made a little over $4000 in the last 24 hours.
It’s up to $723 of profit now.
It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
I don't think you understand what a Ponzi really is. Trading cryptocurrencies is commodity trading, it's no different than pork bellies or precious metals.
What is the commodity? Show me the pork belly. There is no commodity. You own nothing material. No silver, gold or strength of a country. There is money to be made during the frenzy but I don't believe it is sustainable.


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Re: Crypto-currencies

#101

Post by 1911 Raptor » Mon Jan 08, 2018 12:07 pm

Sounds like those in are trying to sell others to join. All we are are roses but nothing about the thorns. People say bitcoins are finite but what prevents more but coins from being created? Because someone said they wouldn’t?


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Re: Crypto-currencies

#102

Post by rotor » Mon Jan 08, 2018 12:14 pm

Why is cryptocurrency a Ponzi? As noted, there are a fixed amount of coins. In and of themselves they produce no income, have no intrinsic value and you can't hold it in your hand so to speak. They are not a commodity which actually has backing although who wants a ton of pork bellies in their garage? The only way they grow in value is if there is a buyer willing to buy in. Without new buyers coming in the whole thing collapses. Let's say your coin is valued at $12,000 right now and you decide to sell it. What happens if there are no buyers? What is your coin worth? Nothing. As with Ponzi, it depends on new people coming in with the glint of riches and easy money in their eye and willing to put their money in. No new buyers and you have nothing. All of the early investors do well as long as they get out before the bubble bursts and the late investors get hosed. This is just a variation of a Ponzi. It requires the blood of new investors to make the profit for the older investors who hopefully for them get out before it collapses. So, once the feeding frenzy is over and there are no new investors (suckers as Ponzi and Madoff would call them) the bubble will burst. Ponzi schemes can go on for years so longevity means nothing. The requirement is new people willing to buy. The incentive is greed as there is no physical "commodity" that one gets. You are not putting a Colt Python in the gun safe waiting for it to increase in value.

Since there is no physical product involved what will you have when it bursts? Spot gold right now is $1316. Not $2000. But at least you can convert the gold into a ring or necklace for your significant other if it collapses. What happens to cryptocurrency if nobody wants to buy what you want to sell (or cash in)?

Now, that doesn't mean I don't buy lottery tickets sometimes but I know I am not going to win but $5 so what, right?

Good luck my friends. Really I hope you all make a ton of money and only strangers we don't know get stuck.

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Re: Crypto-currencies

#103

Post by OldCannon » Mon Jan 08, 2018 12:22 pm

rotor wrote:It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
Please refute the following then, take your time, I can wait:

- There is no central benefactor, thus there is no "pyramid" structure. It is, in fact, the opposite. No single person or entity can simply run away with the money.

- There is no promise of riches associated with investment. It is an investment risk just like any other currency investment, with the insurance that the originating country not propping up the currency with "quantitative easing" (a fancy word for "printing money backed by nothing")

- The value of the item is independent of "continuous aggregative investor" scenarios. A collapse in people buying/trading the currency does not result in a subsequent collapse of the value of the existing currency.

- Bitcoin (or other digital currencies) have a functional limit on quantity. Unlike national currencies.

- Ponzi scheme products cannot function as currency in any way, shape, or form

- There is technically no "bubble" upon which everything collapses. The quantity of bitcoin/litecoin/ethereum always exists in unhackable digital ledgers. The only fluctuation is based on the perceived value of the per unit item. It is, quite literally, impossible to destroy the existing currency without destroying the internet, and that's an entirely different problem.

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Re: Crypto-currencies

#104

Post by 1911 Raptor » Mon Jan 08, 2018 12:37 pm

OldCannon wrote:
rotor wrote:It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
Please refute the following then, take your time, I can wait:

- There is no central benefactor, thus there is no "pyramid" structure. It is, in fact, the opposite. No single person or entity can simply run away with the money.

- There is no promise of riches associated with investment. It is an investment risk just like any other currency investment, with the insurance that the originating country not propping up the currency with "quantitative easing" (a fancy word for "printing money backed by nothing")

- The value of the item is independent of "continuous aggregative investor" scenarios. A collapse in people buying/trading the currency does not result in a subsequent collapse of the value of the existing currency.

- Bitcoin (or other digital currencies) have a functional limit on quantity. Unlike national currencies.

- Ponzi scheme products cannot function as currency in any way, shape, or form

- There is technically no "bubble" upon which everything collapses. The quantity of bitcoin/litecoin/ethereum always exists in unhackable digital ledgers. The only fluctuation is based on the perceived value of the per unit item. It is, quite literally, impossible to destroy the existing currency without destroying the internet, and that's an entirely different problem.

:tiphat:
Unhackable? Please.

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Re: Crypto-currencies

#105

Post by AndyC » Mon Jan 08, 2018 1:16 pm

Well, if you have a way to hack the specific transaction you want to - while hacking every single block in the chain which came before it as well otherwise the math won't work - as well as the millions of "miners" around the world who validate the ledger - all at the same time - then I'm all ears.

Users' computers can be compromised, exchanges and websites can be hacked - but the blockchain itself is going to be a beast to try and compromise. Literally everyone using/holding/trading/mining that currency will be automatically working a single person trying to modify even one transaction.
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