Fools rush in to trade bitcoin
Dec 12, · When most analysts think of bitcoin, they think of tulips. The cryptocurrency's run-up in recent months, in which it's rocketed from around $2, Author: Jeff Spross. Back in January, a Bitcoin was trading at around $3,, and by early July, the price was nudging $13, Despite all the talk of Bitcoin’s growing domination over Altcoins, it is worth noting that over the same period, Ethereum went from $ to more than $ and Litecoin from $30 to $ Dec 02, · So then, if you bought $ worth of the cryptocurrency when it was trading at around $19,, you’d get roughly of a Bitcoin. I’ve Heard About ‘Bitcoin Wallets’. Do I Need One?
Fools rush in to trade bitcoinSo you're thinking about investing in bitcoin? Don't | Bitcoin | The Guardian
An asset can't serve as a store of value if you can never get the value back out. Sure, there can be a brief bubble, where everyone buys the thing in the hopes of selling it later for a big payday. The bubble could even last long enough for people to build additional financial instruments, like futures, on top of all that buying and selling.
But for the market to stabilize and sustain itself over time, like gold sort of has, the chain of purchases has to actually end at some point in real-world applications.
That's what allows everyone else in the market to treat the asset as a store of value: They know whatever money they invest can eventually be retrieved. So what makes bitcoin innately valuable? Even its autonomy and the ease of its digital transactions are replicable and found not only in other cryptocurrencies, but in many normal online payment systems as well.
Winklevoss' defense of bitcoin has nothing to do with this: "Gold is scarce, bitcoin is actually fixed. Bitcoin is way more portable and way more divisible," he said, before descending into outright tech-jargon gobbledygook: "Social networks grow in value exponentially based on the number of users and participants.
The difference between one and is dramatic — and a million is that much more dramatic and exciting. As more people join it gains more value. None of this escapes the charge that bitcoin is just a particularly bad case of irrational exuberance.
In fact, it turns out about 40 percent of all bitcoins are held by around 1, people. And they're clearly holding them purely in anticipation of a big payday. This is a relatively small subculture of enthusiasts who talk amongst themselves, are probably all looking at the same information, and thinking about that information in the same way. When you make this kind of purchase — which you should never do — you are speculating.
This is not a useful activity. Even if you win money through dumb luck, you have lost time and energy, which means you have lost. Investing means buying an asset that actually creates products, services or cashflow, such as a profitable business or a rentable piece of real estate, for an extended period of time. An investment is something that has intrinsic value — that is, it would be worth owning from a financial perspective, even if you could never sell it.
Blockchain is simply a nifty software invention which is open-source and free for anyone to use , whereas bitcoin is just one well-known way to use it. As a real-world comparison for blockchain and bitcoin , take this example from the blogger The Unassuming Banker :. Imagine that someone had found a cure for cancer and posted the step-by-step instructions on how to make it online, freely available for anyone to use.
Now imagine that the same person also created a product called Cancer-Pill using their own instructions, trade marked it, and started selling it to the highest bidders.
I think we can all agree a cure for cancer is immensely valuable to society blockchain may or may not be, we still have to see , however, how much is a Cancer-Pill worth? Our banker goes on to explain that the first Cancer-Pill bitcoin might initially see some great sales.
Prices would rise, especially if supply was limited just as an artificial supply limit is built into the bitcoin algorithm. But since the formula is open and free, other companies quickly come out with their own cancer pills.
Anybody can make a pill, and it costs only a few cents per dose. This screenshot from coinmarketcap. As Bitcoin in particular and cryptocurrency in general continues to rally, this innovative technology is opening up a world of possibilities.
Suddenly, even the most conservative, risk-averse or inexperienced trader can confidently add crypto to his or her portfolio with as good a chance as anyone else of reaping the financial rewards. Disclaimer: The information presented here does not constitute investment advice or an offer to invest.
We strongly advise our readers to DYOR before investing in any cryptocurrency, blockchain project, or ICO, particularly those that guarantee profits. Could you be next big winner? I consent to my submitted data being collected and stored. The cryptocurrency market is growing aggressively, faster than investors can keep up.
Terms like ICOs initial coin offerings that were commonplace just two years ago have now been What is Earn Finance? Earn Finance is a blockchain agnostic decentralized finance aggregator platform that supports DeFi projects deployed on Ethereum, Binance smart chain, etc.