Posted by DigiNomad on 10th of Jan 2024 at 04:40 pm
Cash on sidelines - we all know how the talking heads always
talk about what's going to happen when cash comes off the
sidelines. Welp, crypto ETF's are a HUGE monkey wrench in that
theory.
Back of the napkin calc - if prices double from here, that
would make it close to a 4 TRILLION market cap market. If Tom Lee
is correct about the 5 year path, it would be about a 40 TRILLION
dollar market cap. That's a crap ton of money on the
sidelines!
I don't quite understand Bitcoin's comparison to Gold.
Bitcoin going to 4 Tril. - to converge to the
Gold market cap, relies on limited supply and Massive demand.
The only problem is that there are a large number of cryptos that
are out there and each one is vying to be the digital Gold
standard. So, if there's going to be widespread adoption of
cryptocurrencies then the combined market cap of all cryptos may
converge to Gold. In such a case, Gold's market cap will decline as
well. Interesting to see how the demand for Bitcoin will unfold
going forward.
Posted by DigiNomad on 10th of Jan 2024 at 05:56 pm
BTC has a fixed cap on supply - that's why I like it more than
gold or any of the cryptos...especially now that the Gov today
effectively gave it long term legitimacy. It is a unique aspect of
BTC and extremely valuable in a world controlled by money printing
central banks.
I don't like it as much as BTC because it lacks a cap on
supply, but I bought a crap ton of ETH earlier today on COIN
(because I want to have the keys to my coins). COIN was down
in the regular session, now it's powering higher (up 5.25% in the
aftermarket as I type this). Apparently I'm not the only one using
their platform this afternoon!
yes BTC has a limited supply, but again to me that's not the end
all be all. It's just a digitally created instrument, sort of like
the Robux money for that game that my son wants me to buy him, it's
simply digitally created currency for some dumb game.
Or you take some brand new baseball card and only print 10
copies, which causes the card to be worth $5000 artificially
because of the very low supply of that card, whereas my 1960 Hank
Arron card that survived for 64 years during all those years kids
put them in bike spokes and moms throw them out, is only worth
$300, to me I always hated that artificial value demand just by
limiting demand
Bitcoin is limited, that's great, but there's nothing backing
it. The US Dollar fiat currency yes the print and print, but it's
at least backed by the assets of the governments and
country.
Again Bitcoin is really cool for many things, and of course
criminals love it.
Again it is what it is, I'll ride the wide, but something longer
term doesn't sit well with me about it. Maybe that means I'm
getting old and a fuddy duddy, oh well
Posted by DigiNomad on 10th of Jan 2024 at 07:04 pm
I think you're right to be wary of it. The network effect is
where crypto gets its power (compared to say baseball cards) and
that's why the Gov only approved because of a horrendous legal
mistake and did so through clenched teeth. Just imagine if it
goes to 100K (about a 4 trillion crypto market). That money would
otherwise be sitting in productive assets whether in money market
funds (Gov debt which we all know is being issued like crazy and
needs constant buyers), corporate bonds which benefit private
companies, equities which benefit private companies...and now
crypto. If crypto becomes a viable asset class (seems like a lock
after today) and takes away from the others which historically at
least benefited the Gov and banks when parked in "cash", eventually
it will grow into a real problem. It could actually become
deflationary if it approaches the Tom Lee market cap prediction
levels (parked "cash" in money market funds puts downward pressure
on short term rates. Park it somewhere else and rates rise, all
else remaining equal).
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Cash on sidelines - we
Posted by DigiNomad on 10th of Jan 2024 at 04:40 pm
Cash on sidelines - we all know how the talking heads always talk about what's going to happen when cash comes off the sidelines. Welp, crypto ETF's are a HUGE monkey wrench in that theory.
Back of the napkin calc - if prices double from here, that would make it close to a 4 TRILLION market cap market. If Tom Lee is correct about the 5 year path, it would be about a 40 TRILLION dollar market cap. That's a crap ton of money on the sidelines!
I don't quite understand Bitcoin's
Posted by coolhat on 10th of Jan 2024 at 05:42 pm
I don't quite understand Bitcoin's comparison to Gold. Bitcoin going to 4 Tril. - to converge to the Gold market cap, relies on limited supply and Massive demand. The only problem is that there are a large number of cryptos that are out there and each one is vying to be the digital Gold standard. So, if there's going to be widespread adoption of cryptocurrencies then the combined market cap of all cryptos may converge to Gold. In such a case, Gold's market cap will decline as well. Interesting to see how the demand for Bitcoin will unfold going forward.
BTC has a fixed cap
Posted by DigiNomad on 10th of Jan 2024 at 05:56 pm
BTC has a fixed cap on supply - that's why I like it more than gold or any of the cryptos...especially now that the Gov today effectively gave it long term legitimacy. It is a unique aspect of BTC and extremely valuable in a world controlled by money printing central banks.
I don't like it as much as BTC because it lacks a cap on supply, but I bought a crap ton of ETH earlier today on COIN (because I want to have the keys to my coins). COIN was down in the regular session, now it's powering higher (up 5.25% in the aftermarket as I type this). Apparently I'm not the only one using their platform this afternoon!
yes BTC has a limited
Posted by matt on 10th of Jan 2024 at 06:46 pm
yes BTC has a limited supply, but again to me that's not the end all be all. It's just a digitally created instrument, sort of like the Robux money for that game that my son wants me to buy him, it's simply digitally created currency for some dumb game.
Or you take some brand new baseball card and only print 10 copies, which causes the card to be worth $5000 artificially because of the very low supply of that card, whereas my 1960 Hank Arron card that survived for 64 years during all those years kids put them in bike spokes and moms throw them out, is only worth $300, to me I always hated that artificial value demand just by limiting demand
Bitcoin is limited, that's great, but there's nothing backing it. The US Dollar fiat currency yes the print and print, but it's at least backed by the assets of the governments and country.
Again Bitcoin is really cool for many things, and of course criminals love it.
Again it is what it is, I'll ride the wide, but something longer term doesn't sit well with me about it. Maybe that means I'm getting old and a fuddy duddy, oh well
I think you're right to
Posted by DigiNomad on 10th of Jan 2024 at 07:04 pm
I think you're right to be wary of it. The network effect is where crypto gets its power (compared to say baseball cards) and that's why the Gov only approved because of a horrendous legal mistake and did so through clenched teeth. Just imagine if it goes to 100K (about a 4 trillion crypto market). That money would otherwise be sitting in productive assets whether in money market funds (Gov debt which we all know is being issued like crazy and needs constant buyers), corporate bonds which benefit private companies, equities which benefit private companies...and now crypto. If crypto becomes a viable asset class (seems like a lock after today) and takes away from the others which historically at least benefited the Gov and banks when parked in "cash", eventually it will grow into a real problem. It could actually become deflationary if it approaches the Tom Lee market cap prediction levels (parked "cash" in money market funds puts downward pressure on short term rates. Park it somewhere else and rates rise, all else remaining equal).