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Remarkable statistic

How to buy, profit and invest in crypto currencies or NFTs
Clitheroekid
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Remarkable statistic

#511687

Postby Clitheroekid » July 4th, 2022, 5:21 pm

I was reading this report today, and calculated that had you timed it right (which I assume nobody actually did) then if you'd spent $100 on Bitcoin in 2009 and sold it 12 years later in 2021 you could have made over $6,000,000,000 profit! :shock:

https://www.ii.co.uk/analysis-commentar ... E4NjQzNQS2

This has to be the biggest 12 year return on an `investment' in the history of the world.

Adamski
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Re: Remarkable statistic

#511691

Postby Adamski » July 4th, 2022, 5:33 pm

Probably. Similar I suppose to investing in Amazon, Facebook or Apple at the IPO price.

Difference being Amazon etc sell real products and services in the real world. Whereas a 'currency' which gains 100% then loses 50% value in 12 months is essentially worthless except as a speculation vehicle.

XFool
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Re: Remarkable statistic

#511698

Postby XFool » July 4th, 2022, 7:00 pm

Clitheroekid wrote:I was reading this report today, and calculated that had you timed it right (which I assume nobody actually did) then if you'd spent $100 on Bitcoin in 2009 and sold it 12 years later in 2021 you could have made over $6,000,000,000 profit! :shock:

https://www.ii.co.uk/analysis-commentar ... E4NjQzNQS2

This has to be the biggest 12 year return on an `investment' in the history of the world.

Yeah. Assuming you hadn't forgotten/lost the key to your Bitcoin wallet, or the HD the wallet was on hadn't terminally failed, and the wallet hadn't been hacked over the Internet and drained of Bitcoin, or the Bitcoin exchange holding on to your Crypto wonga hadn't collapsed, been hacked or done a runner with all your and everyone else's Bitcoin.

And of course, assuming you hadn't spent the last ten years in gaol for drug running, money laundering or funding international terrorism. ;)

AWOL
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Re: Remarkable statistic

#511858

Postby AWOL » July 5th, 2022, 2:25 pm

Clitheroekid wrote:I was reading this report today, and calculated that had you timed it right (which I assume nobody actually did) then if you'd spent $100 on Bitcoin in 2009 and sold it 12 years later in 2021 you could have made over $6,000,000,000 profit! :shock:

https://www.ii.co.uk/analysis-commentar ... E4NjQzNQS2

This has to be the biggest 12 year return on an `investment' in the history of the world.


I expect historic returns like that will continue to entice bigger fools to the buy the crypto dip party. The case for crypto is the case for gambling or ponzi schemes.

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Re: Remarkable statistic

#511872

Postby woolly » July 5th, 2022, 3:14 pm

Another remarkable statistic can be found in the "grift counter" at the bottom right of this page: https://web3isgoinggreat.com - the gear wheel lets you specify if you want the total to date, or for it to add up as you scroll down (a long way down!)

Urbandreamer
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Re: Remarkable statistic

#511891

Postby Urbandreamer » July 5th, 2022, 4:28 pm

I was listening to a podcast where a more realistic, yet still remarkable one was given. They picked the 4 year returns.
However it might be better to chose the time periods used for other assets.

Rounded values.
1 Year, up 10%.
3 Year, up 400%
5 Year, up 900%
https://www.barchart.com/crypto/quotes/ ... erformance

I'm down 25%, but that's probably what happens if you start buying at the peak.
Still, I'm only buying really small amounts as yet.

GrahamPlatt
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Re: Remarkable statistic

#511995

Postby GrahamPlatt » July 5th, 2022, 8:59 pm

Sadly, I saw what was probably the first public announcements of the existence of Bitcoin. Was that only 2009? Whatever, it was on a website called slashdot.org. Had a look, thought it would be a flash in the pan & moved on. Damn.

Edit. Just tried to find the article, but their archive seems to only go back to 2017.

Urbandreamer
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Re: Remarkable statistic

#511998

Postby Urbandreamer » July 5th, 2022, 9:24 pm

By the way, does anyone know why detractors often use the term "Ponzi scheme". It's almost as if they are repeating something that they have heard without bothering to look it up. Or know little of bitcoin and assume that all crypto is the same.

In the hope that some might chose to educate themselves, here is a link to a bit about Charles Ponzi and others who planned/executed such schemes or wrote of such.

https://www.investopedia.com/terms/p/ponzischeme.asp

Ps, buying Bitcoin provides NO YIELD! Ponzi schemes promise yield, but use new investors money to pay that "yield" or "guaranteed return" as stated in the article.

bungeejumper
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Re: Remarkable statistic

#512073

Postby bungeejumper » July 6th, 2022, 9:24 am

Urbandreamer wrote:By the way, does anyone know why detractors often use the term "Ponzi scheme". It's almost as if they are repeating something that they have heard without bothering to look it up. Or know little of bitcoin and assume that all crypto is the same.

Discuss. I'd say that Ponzi has become a generalised name to describe an investment of zero absolute value, which is sold down an ever-expanding chain of gullible buyers with the aim of creaming off their money and then getting out before the project crashes.

To that extent, you're partially right. True HODLers tend not to sell and run with the money. But now that people are leveraging their way into crypto, many are being forced by margin calls into hasty sell-offs, so the original "purity" of the bitcoin concept is becoming somewhat muddied. And the emerging reliance on sometimes shaky stablecoins has also shifted the risk in some quite dramatic ways, worse luck.

That being the case, it seems a bit picky to object that the language has changed its meaning over time. We might as well ask whether the word Tesla still means what it did in the days when poor old Nikola was on the case. :)

BJ

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Re: Remarkable statistic

#512075

Postby pje16 » July 6th, 2022, 9:34 am

GrahamPlatt wrote:Sadly, I saw what was probably the first public announcements of the existence of Bitcoin. Was that only 2009? Whatever, it was on a website called slashdot.org. Had a look, thought it would be a flash in the pan & moved on. Damn.

Edit. Just tried to find the article, but their archive seems to only go back to 2017.

Try this site
https://archive.org/web/
(hours of fun)

Specifically
https://web.archive.org/web/20090701000 ... shdot.org/

Urbandreamer
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Re: Remarkable statistic

#512228

Postby Urbandreamer » July 6th, 2022, 6:35 pm

bungeejumper wrote:
Urbandreamer wrote:By the way, does anyone know why detractors often use the term "Ponzi scheme". It's almost as if they are repeating something that they have heard without bothering to look it up. Or know little of bitcoin and assume that all crypto is the same.

Discuss. I'd say that Ponzi has become a generalised name to describe an investment of zero absolute value, which is sold down an ever-expanding chain of gullible buyers with the aim of creaming off their money and then getting out before the project crashes.

To that extent, you're partially right. True HODLers tend not to sell and run with the money. But now that people are leveraging their way into crypto, many are being forced by margin calls into hasty sell-offs, so the original "purity" of the bitcoin concept is becoming somewhat muddied. And the emerging reliance on sometimes shaky stablecoins has also shifted the risk in some quite dramatic ways, worse luck.

That being the case, it seems a bit picky to object that the language has changed its meaning over time. We might as well ask whether the word Tesla still means what it did in the days when poor old Nikola was on the case. :)

BJ


Or we might well ask if the words inflation and debasement mean what they use to.

Austrian economists still regard inflation as an increase in the money supply, arguably another term for debasement.
https://mises.org/library/what-you-shou ... -inflation
If you turn to the American College Dictionary, for example, you will find the first definition of inflation given as follows:
Undue expansion or increase of the currency of a country, especially by the issuing of paper money not redeemable in specie.

Not at all how the term is currently used.

Is communication possible at all if we can't agree upon what is meant by what is said?

As for the term Ponzi, can we now apply it to the ever increasing money supply fueled by increasing government debt and hand outs? Surely that would meet your description of how the term is now used.

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Re: Remarkable statistic

#512316

Postby Aegis » July 6th, 2022, 10:29 pm

Urbandreamer wrote:By the way, does anyone know why detractors often use the term "Ponzi scheme". It's almost as if they are repeating something that they have heard without bothering to look it up. Or know little of bitcoin and assume that all crypto is the same.

In the hope that some might chose to educate themselves, here is a link to a bit about Charles Ponzi and others who planned/executed such schemes or wrote of such.

https://www.investopedia.com/terms/p/ponzischeme.asp

Ps, buying Bitcoin provides NO YIELD! Ponzi schemes promise yield, but use new investors money to pay that "yield" or "guaranteed return" as stated in the article.


That's an odd hill to choose to die on. The point of a Ponzi scheme is that future returns come solely from future "investment" of capital into the scheme. Whether it's expressed as a guaranteed yield, a guaranteed return or just a high return without an explicit guarantee, it's still a Ponzi scheme if it meets that criterion, and it's really difficult to see how you could argue that future growth from bitcoin DIDN'T come from future purchases of bitcoin with external assets. After all, it does nothing else to generate revenue.

Urbandreamer
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Re: Remarkable statistic

#512329

Postby Urbandreamer » July 6th, 2022, 11:45 pm

Aegis wrote:That's an odd hill to choose to die on. The point of a Ponzi scheme is that future returns come solely from future "investment" of capital into the scheme. Whether it's expressed as a guaranteed yield, a guaranteed return or just a high return without an explicit guarantee, it's still a Ponzi scheme if it meets that criterion, and it's really difficult to see how you could argue that future growth from bitcoin DIDN'T come from future purchases of bitcoin with external assets. After all, it does nothing else to generate revenue.


Err, two points about bitcoin, rather than Fiat:

Who guarantees the return?
Who benefits?

Some don't regard Bitcoin as a currency or money. They can't see any money value in it. Hence it has no value, because any money use of it is disregarded.

Some view it as a form of money, hence they compare it against other money. If you have that view you can't help but see how fiat falls short. By all means simply reject bitcoin and consider gold instead. Most of the arguments still hold.

So will you "die" on the hill of the argument that gold is "a barbarous relic"? Will you die claiming that Gold won't rise in price against inflating money supply?

The question is if bitcoin ,which is as limited as gold, but easier to move across the world, has any value.

But back to words. YES I will argue that we can't just chose to use them how we feel. BJ's description of a Ponzi scheme fits fiat. If we chose to claim that bitcoin is a Ponzi scheme because it meets that description then YES by that argument we must claim the same of fiat!

Can you provide another argument that makes Bitcoin a "Ponzi" scheme?

Hallucigenia
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Re: Remarkable statistic

#512332

Postby Hallucigenia » July 7th, 2022, 12:05 am

Urbandreamer wrote:So will you "die" on the hill of the argument that gold is "a barbarous relic"?


Well if you're going to get picky about definitions of Ponzi schemes, then at least get your Keynes quotes correct. He said in 1924 that "the gold standard is already a barbarous relic", not gold itself.

But just as a gentle suggestion, shouting at people and nitpicking about definitions is not going to persuade anyone to your cause.

Going back on topic, perhaps the most famous demonstration of bitcoin appreciation is the 2 pizzas bought in the first "real-world" bitcoin transaction in 2010, for BTC10,000. Was worth about $41 then, would have been $676m at the peak, now $205m.

https://bitcointalk.org/index.php?topic ... 41#msg1141
https://web.archive.org/web/20211219130 ... oin/pizza/

Urbandreamer
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Re: Remarkable statistic

#512335

Postby Urbandreamer » July 7th, 2022, 12:26 am

Hallucigenia wrote:But just as a gentle suggtreolic estion, shouting at people and nitpicking about definitions is not going to persuade anyone to your cause.


Sorry, you are right about that.

It wasn't originally about persuading anyone of the virtues of bitcoin. It was a vitriolic response to the abuse of the term ponzi.

Possibly best relegated to pendents corner.

I just feel that changing what words mean to suit yourself is as much a form of lying as fiddling with the math to suit what you want to argue.

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Re: Remarkable statistic

#512456

Postby Aegis » July 7th, 2022, 11:25 am

Urbandreamer wrote:
Aegis wrote:That's an odd hill to choose to die on. The point of a Ponzi scheme is that future returns come solely from future "investment" of capital into the scheme. Whether it's expressed as a guaranteed yield, a guaranteed return or just a high return without an explicit guarantee, it's still a Ponzi scheme if it meets that criterion, and it's really difficult to see how you could argue that future growth from bitcoin DIDN'T come from future purchases of bitcoin with external assets. After all, it does nothing else to generate revenue.


Err, two points about bitcoin, rather than Fiat:

Who guarantees the return?


No-one. A guarantee isn't necessary for a Ponzi scheme to be a Ponzi scheme. That said, the existing holders are performing this service indirectly with the idea of prices continuing to rise "to the moon", so arguably it's a good example of the first decentralised and self-inflicted Ponzi scheme.

Who benefits?


As with all Ponzi schemes, early investors. They get their returns, but those returns are solely based on greater fools than them buying at a higher price.

Some don't regard Bitcoin as a currency or money. They can't see any money value in it. Hence it has no value, because any money use of it is disregarded.

Some view it as a form of money, hence they compare it against other money. If you have that view you can't help but see how fiat falls short. By all means simply reject bitcoin and consider gold instead. Most of the arguments still hold.

So will you "die" on the hill of the argument that gold is "a barbarous relic"? Will you die claiming that Gold won't rise in price against inflating money supply?


I don't consider gold to be a good investment because it doesn't generate a yield or carry out any economic activity. It's okay as a hedge against inflation. Similar to cash in that sense - in itself it's a very poor investment, but it might well be necessary within a portfolio for stability and diversification.

I'm genuinely not sure why you think that I have any specific views on gold price, especially compared to an inflating money supply.

The question is if bitcoin ,which is as limited as gold, but easier to move across the world, has any value.


Limited in terms of supply, yes, it might be similar to gold, but bitcoin has a lot less utility than gold, which I already dislike as an investment because it doesn't provide enough utility. Gold has value because it's pretty and is used as a catalyst or conductor in a variety of applications. Conversely, a bitcoin is utterly useless, in that it does literally nothing between buying and selling and doesn't equate to anything tangible.

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Re: Remarkable statistic

#512458

Postby Hornblower » July 7th, 2022, 11:34 am

Clitheroekid wrote:I was reading this report today, and calculated that had you timed it right (which I assume nobody actually did) then if you'd spent $100 on Bitcoin in 2009 and sold it 12 years later in 2021 you could have made over $6,000,000,000 profit! :shock:

https://www.ii.co.uk/analysis-commentar ... E4NjQzNQS2

This has to be the biggest 12 year return on an `investment' in the history of the world.


Remarkable returns indeed. Though veeeeery few people were even ABLE to buy in 2009, there were no exchanges. The MT Gox exchange didn't start operating until July 2010. The archived tweets of people selling out 1000s of bitcoin in 2011 or 2012 are legendary.

For much of the past 10 years, bitcoin has been the best performing asset out there. Someone putting a regular amount into bitcoin every week or month has tended to do very very well over time. The last statistic I saw was an average of 200% annualised returns (albeit with extreme volatility) over the past 10 years.

Even the bitcoin skeptics, of which there seems to be many on lemonfool, would have enhanced their returns significantly by allocating just 5% of their portfolios to bitcoin.

Bitcoin is not a 'ponzi' by the definition of the word, however it is subject to the pressures of supply & demand. This can result in self-reinforcing price movements, just like other assets.

H

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Re: Remarkable statistic

#512583

Postby Aegis » July 7th, 2022, 9:32 pm

Hornblower wrote:
Clitheroekid wrote:I was reading this report today, and calculated that had you timed it right (which I assume nobody actually did) then if you'd spent $100 on Bitcoin in 2009 and sold it 12 years later in 2021 you could have made over $6,000,000,000 profit! :shock:

https://www.ii.co.uk/analysis-commentar ... E4NjQzNQS2

This has to be the biggest 12 year return on an `investment' in the history of the world.


Remarkable returns indeed. Though veeeeery few people were even ABLE to buy in 2009, there were no exchanges. The MT Gox exchange didn't start operating until July 2010. The archived tweets of people selling out 1000s of bitcoin in 2011 or 2012 are legendary.

For much of the past 10 years, bitcoin has been the best performing asset out there. Someone putting a regular amount into bitcoin every week or month has tended to do very very well over time. The last statistic I saw was an average of 200% annualised returns (albeit with extreme volatility) over the past 10 years.

Even the bitcoin skeptics, of which there seems to be many on lemonfool, would have enhanced their returns significantly by allocating just 5% of their portfolios to bitcoin.


Ditto if they'd all bought winning lottery tickets, but that doesn't seem like a sound investment strategy to me either.

Bitcoin is not a 'ponzi' by the definition of the word, however it is subject to the pressures of supply & demand. This can result in self-reinforcing price movements, just like other assets.


That's an interesting claim, and I'd genuinely like to know how you distinguish between cryptocurrency and Ponzi schemes. After all, if I tell you that I have an investment opportunity for you which involves buying an asset now which will be economically inactive but someone else will pay you more for it in a year or a decade or whatever because they will also be in a position where someone will buy that asset for a greater price at some point in future, then the asset in question is purely valued by Grater Fool Theory, which makes it indistinguishable from a Ponzi scheme.

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Re: Remarkable statistic

#512668

Postby Hornblower » July 8th, 2022, 9:28 am

Ditto if they'd all bought winning lottery tickets, but that doesn't seem like a sound investment strategy to me either.


This is a silly argument. Maybe like a grandfather saying back in the early 2000s that 'investing in that Google stock is like buying a lottery ticket', when their grandson could see the opportunity there as it slowly defeated the other search engines before growing into the tech giant we see today.

It was new technology. No-one even knew if the internet was going to be a big thing (few suspected how integral the internet has become to our lives & the world economy). There was lots of competition. It was loss making. It wasn't even clear how they would monetise.

Similarly, bitcoin is new technology. There are some futurists who predict it will up-end the world. That sound money that governments can't steal, inflate away, or contain within their borders is going to usher in a new renaissance of human flourishing. Just like Google it has lots of competition, 20,000 'cryptos' & counting. Many promising to be the 'next bitcoin' or to be faster, or offer more bells & whistles. They come, they go. A thousand scams & ponzis & dreams crash against bitcoin every year, never to be seen again. The promising 'next bitcoins' in 2014, 20216, 2018... all gone or sunk into irrelevance. Bitcoin isn't a business, it doesn't make any money. It's a new thing that many tax & financial authorities classified as a commodity. It's an emerging speculative asset, just as Google was a speculative investment back in the day. Comparing it to a 'lottery ticket' just exposes your ignorance. I heard the same claim over the years when it was $150, $600, $20,000, $60,000. At some point, people will have to revise their mental model.


That's an interesting claim, and I'd genuinely like to know how you distinguish between cryptocurrency and Ponzi schemes. After all, if I tell you that I have an investment opportunity for you which involves buying an asset now which will be economically inactive but someone else will pay you more for it in a year or a decade or whatever because they will also be in a position where someone will buy that asset for a greater price at some point in future, then the asset in question is purely valued by Grater Fool Theory, which makes it indistinguishable from a Ponzi scheme.


I make no claim about 'crypto', I'm talking about bitcoin.

According to wiki, 'A Ponzi scheme is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors'.

There's no payouts, there's no-one luring, there's no-one in charge. Bitcoin isn't masquerading as equity, just treat it like a (speculative, digital) commodity. Gold is 'economically inactive', so by your definition is a ponzi! Bitcoin is open-source software that people are voluntarily interacting with. Buying something in the expectation that it will increase in value in the future is exactly the behaviour of people investing in stocks, or buying commodities or real estate.

38% of US investors that were surveyed recently hold 'some kind of cryptocurrency', with the number rising to 60% among millennials! The comparative figures that I've found for the UK are around 3% across all ages. This isn't telling us that the people in the UK are more sophisticated investors, it's showing what a backwater the UK has become. Once again, just like the internet, all the innovation & value creation/capture will happen elsewhere while UK investors debate the merits of buying a slowly-growing insurance company with a good yield while the £ inflates their wealth away.



H

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Re: Remarkable statistic

#512680

Postby Bubblesofearth » July 8th, 2022, 10:18 am

Hornblower wrote:
Similarly, bitcoin is new technology. There are some futurists who predict it will up-end the world. That sound money that governments can't steal, inflate away, or contain within their borders is going to usher in a new renaissance of human flourishing.


What exactly is the vision here? Governments (which remember are elected by the people in democratic countries) abandon all control over the money supply? Collect taxes in Bitcoin? Or are we talking anarchy?

You need to think beyond just what governments can't do to how that plays out.


Buying something in the expectation that it will increase in value in the future is exactly the behaviour of people investing in stocks, or buying commodities or real estate.


You are describing the behaviour of speculators/gamblers. IMO most investors are looking for a reasonable return from stocks and real estate, in the form of both income and capital growth, that is tied to economic growth. Many may never sell their investments.

BoE


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