If you want to invest your money, buy index funds. That's about as safe as it can be while still bringing in reasonable returns.
S&P 500 seems to be a particularly stubborn climber. No idea why it climbs harder than other index funds, but it's been very reliable for as long as I've been paying attention to it.
Would be interesting to see distributions compared. I imagine it to be similar everywhere: most stuff is owned by not that many people. Only difference: in Bitcoin, they might be different people, thus adding to a better distribution overall.
Also I do not consider ETFs safe at all. If you dislike Bitcoin (which is totally fine), maybe buy gold or land, since ETF composition might change, land and gold might not.
ETF and land represent real production value. Land most directly of course, and that's about the most stable as you can get: even if literally the entire economy collapsed, at least you still have land you can farm.
ETFs are a bit indirect; to be more direct, you'd have to buy shares of the individual companies represented in them, but for most people that's a lot of work. ETFs get you the same thing. Their composition might change, but only slowly and tied to a whole bunch of criteria. And in the end, they do represent the economic value of real companies that produce things.
My thesis remains, that "real production value" does not exist, or at least is dwarfed by people "electing" a store of value. Like Tesla, gold or land.
Bitcoin seems to me uniquely suited to become the next store of value elected by the most.
If it does, even land might lose value compared to it.
Volatility might lessen over time, in any case is only a real problem if there is a long-term down trend. Else, just DCA in and out.
Of course, this is all hypothetical, no guarantees.
I strongly doubt that. It's too impractical. Literally the only thing that gives it value is the trust of people, and that's a fickle thing.
It might have gotten big as an online payment system if it could scale sufficiently for that, but it turns out it can't; payments are too slow and expensive. With that gone, blind trust in a system that has proven to be very volatile and has had a lot of events where a lot of people lost access to their bitcoins, does not seem very likely.
It’s this funny quasi status that I see lots of statements around. We need a digital currency. But currencies shouldn’t fluctuate or be primarily an investment since that makes it sucky as a currency.
For example, I had a friend who grew up in post-communist Yugoslavia. Their grandmother would send them to the grocery store with a thousand dinar (or whatever) to buy vegetables for dinner and the price would go up during the time to walk to the store. That sucked.
If I want to get a salary of 1 Bitcoin a year, and that varies in value from buying a month’s rent to six month’s rent that is not useful.
No currency is guaranteed to lose or gain value over a mid to long term. Venezuela will go away and change their currency, few are holding Venezuelan currency except people who live there and must use it to live. People there don’t want to switch to Bitcoin for many reasons like it’s volatile, shitty for transactions, and not as widely used. Last I heard they are trying to use dollars and maybe euros unless their government bans.
There are more countries that just use the dollar [0] and don’t think it would be wise for any to switch to Bitcoin. For all it’s weaknesses at least the US$ is fairly stable and tied to the USG that has some accountability. A country tied to a currency as manipulated as Bitcoin will be in a bad space.
The first stable government that comes out with a digital currency will be in a good macro place. But it won’t be a good speculative investment.
[0] https://en.wikipedia.org/wiki/International_use_of_the_U.S._...
All inflation does is set a cap on real pay decrease. Since very few businesses will decrease pay, then a 4% inflation environment means Bob who didn't get a rise this year effectively gets a 4% pay cut in real terms.
One major thing I like about Bitcoin is that anyone can buy small amounts from an app, and even self-custody it themselves. This is similar to gold but much, much easier and because Bitcoin is purely digital you don’t need anything more than an app and an internet connection. Bitcoin is inflation-protection for the global poor, something rich HNers are less likely to appreciate.
And I recognize that Bitcoin is extremely volatile, which makes it harder to use as a hedge against inflation. But if you use currency that is guaranteed to lose 30 to 90% of its value per year (Venezuela, Turkey, Lebanon) then dollar-cost-averaging into Bitcoin makes way more sense than holding worthless paper.