Why I'm avoiding investment in bitcoin.
Probably not going to be a popular opinion, but here goes.
I have a rule for investing in cars, and it goes like this: "Invest in something that won't be made obsolete".
The car I would invest in right now is an early model Honda S2000. It's never going to be made again, as it has a high revving engine that would not pass modern emission testing. It has plenty of parts, and can be easily kept running for a long time into the future and it's at a price that's accessible to most people. It's from a trusted brand, it's known for reliability and low running costs, and it has a price history that shows a clear linear trend upwards.
Most people aren't thinking of investing in it yet though, because they're ubiquitous and common. It's a good opportunity, because you'll be able to get one at a great price.
Compare this is bitcoin. It's been replicated thousands of time, it has extremely close competitors that are technically superior. It's barely functioning, with very long transfer times and costs. How am I supposed to convince a friend to try bitcoin when it costs $5 every time you try to buy something?
Bitcoin is not what I'd call a trusted brand. I don't really know who's controlling it, they are constantly arguing about how to manage it, and it's hardly decentralized if every five months another group of devs undermines the whole concept by creating a new spinoff.
It's an extremely wasteful technology, huge amounts of waste heat are created doing pointless calculations. The infrastructure relies heavily on the increasing price of bitcoin. Miners will quickly disappear without a profit motive, furthering the problem of transaction times.
Another reason I'm not investing, is the famous wall street saying: "When taxi drivers start giving you stock tips, it's time to get out of the market".
I am getting friends and family who I've tried to get into bitcoin for years, finally coming up and asking "Hey how do I invest in this bitcoin thing?". If your average Joe is starting to invest in bitcoin, I'd say it's pretty likely the smart money has already come and gone. You're going to see a drying up of the demand side. I just don't think the available capital is there. When inexperienced investors start panic buying and panic selling, they're going to create instability in the price which could easily lead to a crash.
My strategy is now, what it always has been. Invest about 5% of your income weekly as a hedge against inflation, and forget about it; but right now? I'm calling a bubble. An obvious bubble.
If anyone knows of an actually decentralised, non inflationary currency with low transaction costs, let me know. Until then, my advice?
Invest in an early Honda S2000, buy a house in a rural town and always wear a condom.
Best regards,
Business.
I think bitcoin is the best investment
Okay, and why do you think that?
If you follow the advice in the last sentence... "always wear a condom..." you'll be able to afford all the BTC you want..
lol we invested in a Volt last year. Best investment yet. Electric with gas componenent, fuel economy, though we hardly ever use the gas. And it doesn't add too much to the electricity bill.
I invested in NEO recently, when it was only $7 and it's gaining nicely now. It also has a GAS component lol as we can claim GAS every now and then. NEO generates GAS token.
If only MY gas could take value, then we'd all be rich. No shortage of supply there.
In all seriousness though, I myself have not invested in Bitcoin, because the fees are too much since it's worth so much. Litecoin seems to be the new "norm", though Frank has Bitcoin and a bunch of other cryptos.
Oh, and to your last sentence, I add, unless you're trying to have a baby ;)
your logic is sound. i don't know about bitcoin, i think it's so different from money before that it's almost impossible to genuinely know what is going on. like you say - who owns it? how do they make decisions? etc... are really important points that people are just ignoring for some reason. i remember my grandfather way back in the early 90s saying CDs would never catch on. he was wrong, billios of units were produced for a plethora of reasons and yet 20 years later CD's were virtually obsolete. so in a way he was right too. i fear bitcoin may be one of these types of thing and most people are going to get burned, especially now that the buy in price is so high, relatively speaking. thanks for the article @business :-)
have a sunny week,
HA
@humanauction
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