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How valuable would it have been for you to learn about bitcoin when it was trading at $0.01 before going to $0.10 or even $1.00?
What about when it was at $1.00 going to $10?
$10 to $100?
$100 to $1,000?
$1,000 to (almost) $10,000?
What about now when it's almost $10,000? What if it goes to $100,000+ as some very smart people predict? If you buy $100 worth now and it does go up, that would be quite nice, right? Note: you never have to buy a "whole" bitcoin as there are 100 million divisions in each bitcoin.
The challenge with explaining the value proposition of bitcoin (and cryptocurrency in general) is that it's highly technical and involves some macroeconomic theory. On top of that, there's a lot of speculation and volatility. I've been digging into this stuff since the start of 2013, and I'm still learning daily. I'm a programmer who gets open-source software and loves learning economics stuff, specifically the origin of money and how we use it, so this all makes some sense to me.
But I won't suggest you should go buy into a speculative investment if you don't understand it. The old model of trusting someone else (like a stock broker or a bank) to make your decisions is falling away. We have to take personal responsibility for our actions. With cryptocurrency, you only own it if you control the private key and take the appropriate steps to secure it. It's digital cash so if you lose your private key, it's like flushing your money down the toilet as it'll be gone forever.
I will suggest you will benefit if you put in some effort to learn. Avoid a knee-jerk reaction and recognize your paradigm of value itself may be unexamined. Learn from some experts, be cautious of the scammers, and put in some time. I think it will be well worth it for you.
Yes, the market is going up crazy fast right now. If you zoom in on this chart, you'll see similar volatility repeated over and over again (though the 2014 highs now look like small bumps in the road):
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I'm not trying to encourage FOMO (Fear of Missing Out) where people buy in at the top of the market only to watch it crash the next day. What I am suggesting is to just get involved in what might be the future of finance. Money, as I've talked about before, is essentially a ledger and the blockchain is an immutable, cryptographically-secure, globally-distributed digital ledger making it the best form of money ever invented.
If you're already here on Busy/ChainBB/Steemit, then you're already using the blockchain, and you already have a cryptocurrency wallet with STEEM, Steem Power, and SBD. You are here learning from other cryptocurrency early adopters. You have an advantage. Take the extra step and put in some time to learn this stuff so you can educate your friends and family.
A friend reminded me today of emails I sent a while back, trying to get my friends involved in what I was learning about. Here's one to a group of friends in April of 2013:
For many, it seemed crazy to buy at $100. Crazy again at $1,000.
Will people in the future look back at our opportunity to buy bitcoin today at $10,000 and think we're crazy not to buy?
What about BitShares at $0.15?
EOS at $2.90?
Steem at $1.21?
I can't predict the future, and I won't tell you what to invest in. I also personally know what it feels like to watch the price of bitcoin go from $1,200 down to $250 like it did in 2014. I know that feeling of sadness as you second guess all your reasons for why bitcoin (and more generally, cryptocurrency) was going to change the world.
I don't see a reason to second guess any more. We've had 192 bitcoin obituaries so far, and it's still here. The more I learn, the more I want to live in a world where money isn't controlled by violent governments, but through open protocols and secure cryptography.
I'm excited about the future, and I want you to be onboard also.
I put some videos together at @ubf (understandingblockchainfreedom.com) to help you. Check it out. Ask questions. Learn. A future financial system is coming that is very different than what most people have known their entire lives. I want to help people understand.
You can also create a BitShares wallet (here's a referral link) to buy and sell on a decentralized exchange: https://wallet.bitshares.org/?r=luke-stokes
The Cryptocurrency Bank Spreadsheet will help you keep track of all your trades and holdings.
You can do this. You have a community here on the STEEM blockchain ready to help you, including me.
Created with ChainBB to help support that project.
Just be careful, is all. Nothing goes up like that forever. "What goes up, must come down" -
Let's just take the contrary position for the sake of argument - "the price rise you're looking at will continue, perhaps with small corrections here and there, but will basically continue to rise over time."
If that's true, there's no point in owning Apple stock. There's no point in buying a house. There's no point in owning any commodity, currency, or anything. Everything ought to be in Bitcoin. Investing in anything else would be crazy or pointless.
And if that's true? Then there's no more investment into anything else. Everything goes into Bitcoin.
I guess your "success scenario" after that is every commodity, product, service - everything, ever - would suddenly get re-priced into Bitcoin. Because why take a failing fiat currency, when you can take Bitcoin instead? Dollars dissipate in value. Everything ends up in ruin.
But the inflation rate on the US $ isn't particularly nutty right now. Couplea percent per year I'd figure. So that doesn't add up.
I don't doubt you can make a pretty penny on the odd bitcoin here and there. But the graphs look just like the Tulip graphs, or the above-mentioned South Sea Company.
So, just, be careful is all I ask. I love being right, but I don't want to be right on this one, because I know too many people are going to get hurt. I'm hearing things like "Borrowing into Home Equity Lines of Credit to buy Bitcoin" and that freaks me out. Plenty of people will be in financial ruin.
Please at least try and have some kind of backup plan. Because whenever something cannot possibly fail, then it can't win either - if there's no risk, it doesn't make sense that there'd be any reward.
After almost 5 years in the bitcoin space, I now find it funny how many people are so eager to tell me, personally, to be careful. I've already paid off my house and done very well with cryptocurrency. I wonder, are they just trying to make themselves feel better about not getting involved themselves?
I've got nothing but love for you, @uberbrady, and I genuinely believe you care about people and don't want to see them get hurt. I also think borrowing money to buy into a speculative investment is straight up crazy (I told a friend exactly that just a few days ago). That's why I mention FOMO in the post. I invested after getting out of debt and already having investing in traditional ROTH IRA mutual funds for retirement. Maybe I should emphasize that point more because some people are just financially stupid and take irrational risks.
As to
dhhand so many other cryptocurrency skeptics (see this fun reply to patio11 yesterday), I sometimes feel it's not worth our time debating with them. I heard the exact same arguments as bitcoin went up to $100 in 2013 and there was even more volatility (percentage wise) then.It won't go up forever, obviously, but it will go up until it reaches a market equilibrium in perceived value. The arguments I've seen (and linked to in this post) for $100,000 or $1,000,000 a bitcoin seem sound to me. $10,000 is really cheap if those are actual realities in our future.
For me, it's not about the inflation rate of the USD that concerns me as much as the deflation rate we're not seeing. How much purchasing power is being stolen from people because deflation is not allowed? What if this massive spike in purchasing power in cryptocurrency is more of an indication of how much wealth exists as an emergent property of humanity's technological advancement? What if instead of the government cronies skimming all the value off the top, we had a universal basic income powered by the blockchain?
How much would human well-being improve?
Your caution is noted. As I said in my post, I watched bitcoin go from $1,200 to $250 in 2014. That would be like it going back down near $2,000 today. I'm prepared for that, and I agree with you that others should be as well. Diversification is key and not just in the cryptocurrency space.
Nice post! What will happening, if someone resteem your post?
Disclaimer: I am just a bot trying to be helpful.
I've argued that Inflation (mild, not-crazy) is what you want to see. What Inflation would mean is that 'old work is less useful than new work.'
What deflation means is that 'old work is more useful than new work.' It rewards the old, and punishes the new. Deflation punishes debtors, and rewards lenders. The 'haves' get more, the have-nots earn less, and find their debt harder to pay off.
Example: I borrow 1000 'credits'. I'm earning 10 credits an hour. Over time, the currency deflates. My boss says, "Hey, I'm only gonna pay you 5 credits an hour now, your purchasing power will remain the same." It's now harder for me to pay down my debt. Meanwhile, the guy I borrowed from, the amount I owe him (in terms of purchasing power) has now doubled.
I think you're talking about a paradigm where "work" still has meaning, and I'm thinking about a future of automation and AI where most human beings will be unable to compete to provide value. I also think debt can be a form of slavery, and it keeps the poor in poverty. If people want to become rich, they have to do things rich people do which includes saving, investing, and not borrowing at high interest rates.
You added the "My boss says..." part which, to me, changes the entire equation significantly. I don't think people realize just how messed up the whole system is because we've been living with a manipulated currency since the 1971 Nixon shock. With more purchasing power, why couldn't workers (however many may still fit that category after automation and AI) instead say, "No thank you, I'm not going to take that job at that rate because a blockchain UBI takes care of my needs and my savings (small though they may be) will sustain me and grow in value. If you want me to work for you, you'll have to compete by offering me higher wages."
Financially, both for society and individuals, do you think incentivizing borrowing is better then incentivizing savings and investment?
I am also grateful to those who tell me to be careful when buying bitcoin. The more the merrier! Someone was telling me to watch out because crypto is “really volatile”. They had just heard my pitch and wanted to save my bacon. I’m not sure if they will look into bitcoin any time soon.
“The old model of trusting someone else (like a stock broker or a bank) to make your decisions is falling away. We have to take personal responsibility for our actions.” @lukestokes that was a fantastic comment.
Thanks for listing out your success with crypto investments. I bought into the idea of crypto when people discuss the deflationary value of fiat currencies. The reality is most legal currencies are worth nothing and the ones who have authority makes the rules as to it does. Bitcoin and a host of altcoins will prove them wrong.
Honestly everything is a bubble investment, but to actually earn a living and have life changing experiences through financial gains is worthy of the risk. I personally think whether or not bitcoin will pop soon would not matter to you because you already gained the finance you need to survive on. I hope to follow the same path with conviction.
Too much news and data in today's world that can easily impair one's judgement. But the reality is to all those who are on steemit we are in a revolution together. Discussions of why we invest in crypto is a key reminder that we are all in this overall crypto revolution. Whether the outcome is good or bad is for us to decide. Lets bring the best out of mankind through the use of crypto.
LikeTulip bulb mania? Didn’t Jamie Dimon say that? I just checked out the tulip bulb mania bubble. Seems that at the time a tulip bulb came to be worth more than a house.
So if the forecast is that the price of bitcoin will replicate that, we have some way to go. Of course, it depends on whose house we are talking about. I hope it’s Buck house where our dear Queenie hangs out.
Really enjoyed your post, I am one of the stupid ones who know nothing about how it works. But what you wrote make a lot of sense to me.
I just got done making a tutorial video for coinbase because I have so many family and friends asking about how to get into bitcoin. The word is getting out.
2 things I tell them.
Great post and well thought out. Upvoted and followed.
That's some good advice and thanks for the follow.
That's the same reason I made the @ubf videos. Saves me time answering the same questions over and over again. :)
Nice article,its fascinating how crypto works but complicated for me too.
@lukestokes - I must say that reading your previous articles about crypto currency and your account of how you invested encouraged me. I have a small investment in bitcoin and couple other crypto currencies due to that. I am happy I have invested and am sure it will pay off in future. I am also diligently putting in efforts to grow with Steemit. Thanks. Appreciate all the practical guidance your articles provide.
Upvoted
Regards,
@vm2904
@lukestokes I had to FULLY UP Vote this Posting you just wrote what I have been trying to tell people around me for the last 8 months. They still have not wanted to DIP their Toe in the Water. I tell them once you get your first Crypto and just send it from one wallet to another you will understand a New FREEDOM................FREEDOM is here you just need to dip your toe in the water.
That's so true. Once you control your own store of value for the first time, it unlocks something in the brain and you get it. FREEDOM indeed.
Why are people waiting? Is it too late? It is NEVER too late.. the best time to get in... is ALWAYS NOW!
I like your posr.
That cryptocurrency spreadsheet is incredible! I was going to tell you this on your next post!! I think it may be time for a post soon dedicated just to it!
The education is key in this realm because it appears that blockchain is the future and the future is now!
And what about SmartCash at $.05? haha
Thank you! Yeah, maybe I should do another root post on it soon, but I try to link to it whenever I do anything cryptocurrency related so people can find it easily.
Yeah, I almost included SmartCash in my list as well, but I really do see that one as highly speculative at this early stage. I'm happy with the SMART holdings I have now and am really interested to see where it goes from here, but I'm really, really excited about the ones I listed. To me, they are proven technologies (or, in the case of EOS, proven technical leadership with a track record of proven technologies).
I heard about bitcoin last year for the first time and I'm glad I didn't even think twice to jump in
So I had great wall your post and I have understand that there is inbuilt features in the currency and as you said about the various. And the levels of Bitcoin and there will be the probability that Sunday it will touch a level of 100000 so suggest I want to know so please give genuine suggestions to me I actually wanted to put my money then bit share what would you think about this cryptocurrency
I think BitShares is a fantastic project. Here are some of my previous posts on it:
I was with you right up until the "sent from my iPhone" part. LOL
Yeah, it's still early days for crypto. Now the question is which ones to invest in. Not if, but where, and how much of each? I'm spreading things around trying to "cover my bases". I'm learning more and hopefully choosing smarter than I did when I first tossed money onto bittrex and took a shotgun full of darts and let the chips fall where they may.
I'm for sure coming back to check the link to your videos! I need all the learning I can get!
I remember listening to Sneak talk about how the iPhone is the most secure phone on the market. I can't complain about it. :)
Yeah, there are a lot of amazing projects out there. I think the more we learn, the more we can find the winners among the losers. As long as the team is solid, the plan is solid, and the code is solid, there's almost no bad choices in this crazy bullish run.
Informative and motivational too ! thankful for your effort !!
wow nice post i like it so cool plz follow me @technical.google
Asking for followers is a good way to get flagged, not get followers. Instead, provide value. Maybe the posts I link to here will help: #SteemitIsToMe: Relationships, Reputation, and Rewards
I remember not buying 10 bitcoin at $100 each. Ouch!
We all have to measure the risk and the reward
I had no problem holding through the drop to $250 because btc was only competing with fiat and a few other PoW coins.
Whole different story now.
Yeah, that's a good point. A drop in BTC would most likely mean a transition to some other cryptocurrency, not just a flight to fiat (IMO). We've already seen this with Tether, bitUSD, and SBD.
This is a fantastic article. Everyone perhaps has a doubt of 'when to really join' and leverage the crypto market. I would say, the best time to buy is 'now'.
Everyday learning is what the crypto market demands. I got into Bitcoin pretty late (June, 2017). I have so much interest in other promising coin and ICOs.
I predict digital currency taking over full time soonest. It's a digital world afterall.
Great post @lukestokes
Thank you!
by next year it will be $20000
Everyone should start looking at Bitcoin in increments of Satoshi's.. because $10 worth of Bitcoin is either 100,000 satoshi or 0.001 Bitcoin, which sounds better? I find when I tell people how much $20 or even $100 can buy them nobody is impressed..I could see things priced in Satoshi's one day tho!
Steem is the absolute BEST way, bar none, to acquire funds to invest in Crypto.
If you win..you win big..
because what have you invested but your time?
if you lose...all you've lost is your time.
and likely as not you'd have been doing the SAME thing anyway.
Thanks for delightful post.
I'm asking myself everyday when seeing the prices of bitcoin and other coins going up the same question: "Should I invest now", but it's very wrong if you start investing without understand it clearly.
I also think that blockchain is a long-term thing, it will not beneficial if you are just surfing
I have 1 Bitcoin already
Actually I don't prefer to invest in Bitcoin. Because i will not get that much % of profit that i can get investing in other low prices atlcoin.
I have invest good amount of money in ETC etherium classic 3 months before and now i got a very good profit and also the future is better that Bitcoin in % profit. Of course Bitcoin is best but not to get % profit as a investor.
And now a days i am focusing on Steem because of this promising project steemit. I can easily see the future of steemit on the sky. Great bloggers are joining steemit now a days. Future is very bright.
Yeah exciting times ahead! I will leave this here since it is related to the topic... Obituaries will happen along the way I completely agree, 50% correction or more is always possibility...
"Will people in the future look back at our opportunity to buy bitcoin today at $10,000 and think we're crazy not to buy?" Of course, it's just a beginning. Someday people will regret they did not buy at 20-30+k
Thank you very much for transmitting your experience to those like me who are more novices in the cryptoworld.
I feel very identified, I am one of those who entered the crypto when 1 btc was worth $3600 and it seemed like a brutality ... look now :)
Just a few hours ago I was thinking and mediating on a point very similar to the one you posted and I wrote a post titled cryptoapocalypse,.......... yes, the title is catastrophic but my reflections and conclusions are not, in reality they are very alienated with your opinions.
Thanks again for sharing your vision and experience.
The current price of EOS really took me by surprise. I had been quietly stocking up on it for quite some time, but then decided to wait for a dip before I bought more. Now, it has more than doubled than when I initially invested. Any information what caused the surge?
STEEM's recent surge bodes well. I just hope that Bitshares gets the attention it deserves. I think it should be valued way more than Waves.
Love it! Yes I am following you! Great post! Follow me I am new here \o/ Up-voted and resteem on!
Today is my one year anniversary and I decided to do a post of collages representing my journey- I snatched a couple pictures from this post :) My aim was to represent every awesome person I've met on the journey. If you get a chance to check it out, please do :)
@lukestokes
Quite informative and o cannot agree more on most assertions here. I posted 3 days ago on Bitcoin exceeds the $9k mark just to update another post on same Bitcoin exceeding $10k mark!
Amazing option which is taking over the world. Thanks for sharing