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Not a billionaire, but also trying to keep some percentage of my net worth in cryptocurrencies. Worked great so far. 10% seems to be about right.

(I have much more trust in blockchain than in government retirement schemes).




>Not a billionaire, but also trying to keep some percentage of my net worth in cryptocurrencies. Worked great so far. 10% seems to be about right.

I don't see how people can look at cryptocurrencies as investments over the long term. It's like saying you have all your money in Swiss Francs in a checking account that returns no interest because you think the Swiss are doing a stellar job at setting up an economy/banking system.

In the short term you're basically betting on cryptocurrencies gaining adoption and thus more of the economy needing them. In the long term it's just a currency not an investment.

>(I have much more trust in blockchain than in government retirement schemes).

That's not the alternative, some kind of diversified portfolio of stocks (a simple index fund is usually the easiest) is the right benchmark. Personally I will always feel safer with owning a (very small) percentage of the total productive companies in the world than a currency that's only worth something as long as someone is willing to keep trading in that specific one and not change to some other one. I look at the value of my stock holdings in euros only because it's also my day to day currency but the underlying value can be repriced in any currency over the next 50 years (my investment horizon).

What I would really like to do is price my stock holdings as percentage of total world stock market capitalization (with plenty of decimal points). Anyone have a good source for that number?


> I look at the value of my stock holdings in euros only because it's also my day to day currency

Until it isn't and it's replaced by a new one. Less than 20 years ago Euros didn't exist. It's entirely possible that in 20 years time they won't exist either...

You've played your hand by saying you look at your stock holdings in fiat. What happens if fiat fails you? i.e. if hyperinflation kicks in or the powers that be decide to restrict access to your fiat? I realise it sounds tinfoil hat-esque but if investing to safeguard your future, these are possible doomsday scenarios... (just ask people of Venezuela)

> In the short term you're basically betting on cryptocurrencies gaining adoption and thus more of the economy needing them. In the long term it's just a currency not an investment.

A deflationary currency with a fixed supply... so it's an investment in the sense that (a) it's scarcity will naturally drive up the price if demand increases (b) it will hold value better than fiat, given that the supply of fiat is, well, unlimited.


>You've played your hand by saying you look at your stock holdings in fiat.

Are we having a discussion or playing poker? What hand did I play?

> What happens if fiat fails you? i.e. if hyperinflation kicks in or the powers that be decide to restrict access to your fiat? I realise it sounds tinfoil hat-esque but if investing to safeguard your future, these are possible doomsday scenarios... (just ask people of Venezuela)

I'll just sell my stocks for another fiat currency or even bitcoin if/when I want to. You're missing the point completely. My stock holdings are shares of companies not fiat currency. I can look at them in whatever currency I want. I can also see the value of my holdings in dollars or yen or bitcoin and it's just as valid. I'm not storing value in euros, only using them as the unit when doing valuation of my holding of companies. The same applies to cryptocurrencies, they're not valuable in themselves, only as a means of exchange.


But a diversified stock portfolio wouldn't allow me to write smug Medium articles when speculation drives the price up and remain conspicuously silent when the price craters shortly thereafter.


You are doing it wrong. Sell the rips and buy the dips.


Diversification only on the stock market isn't a good idea. It doesn't protect against the insurers going bust, for instance. In this case, keeping some % of net worth in a cryptocurrency makes sense, just like keeping a few gold bars/coins or an emergency stack of bills makes sense for that day when the internet is broken.


>It doesn't protect against the insurers going bust

Can you clarify? I mean, I agree that your diversification should extend beyond the stock market (bonds, some metals, real estate). But I'm not sure what you mean by the above.


Bitcoin should be seen as digital gold. It has no value in itself, but its likely that you will be able to use it for payment even if all else fails.


In the event of a societal collapse so great that no money is usable, it's pretty hard to imagine people caring about Bitcoin. There might not even be power in this weird Mad Max scenario. They'd probably want to barter for goods.


Societal collapse doesn't have to mean going back to the stone age, it could mean e.g. the Iranian revolution. Or for a contemporary example: the Syrian civil war.

Even Spain was a dictatorship until 1975. Everybody should consider the possibility that their society will collapse, even if they choose to do nothing about it.


My point is that there are a lot of things that seem like they'd be better to have in case of societal collapse than an Internet currency with no intrinsic value that you'd have to educate most of your (possibly former) compatriots about just to have a chance of them letting you use it.


>but its likely that you will be able to use it for payment even if all else fails.

Can you give an example of a modern economy collapsing and reverting to gold as a medium of exchange?


I can't give any such example. However, EVERY economic collapse has been followed by rebuilding. Maybe the nation has a new name or new boundaries, but something is always rebuilt. And once it is, gold has value again.


I hear Bitcoin is popular in Venezuela, where the people hunt pigeons for food after the communists took over. It's also popular in China, where - again - people are scared of their government.

I don't know that the US federal government is as scary, but it's not unheard of.


So we're back to "Bitcoin is mainly good for evading the law."


The law is not always universally good.


Especially when your and their opinions on taxable assets differ.


Oppressive governments are essentially the only good reason to use bitcoin, since the usual financial system is far more efficient at storing and transmitting money. He's either evading taxes or speculating.


My bank charges $40 + 2% forex spread for a wire transfer to Thailand. With Bitcoin I actually come out at a small profit. Bitcoin is way better at consumer level international transfers than banks.


Even generally non-oppressive governments make errors, and it happens more often that you'd think (and suing might be prohibitively expensive, untimely, or not an option at all).


The usual financial system is far more efficient at converting your wealth for the use of the oligarchs. USD for example has lost almost 100% of its value since the institution of the Federal Reserve system. The wealth did not go away. It was merely transferred from the populace to the rentiers.


Mostly collapsing countries revert to .. dollars.


So you think when society around you is failing you'll still have enough infrastructure to be able to do transactions in bitcoin? Seems like a narrow scenario. Bad enough that there are no reasonably stable fiat currencies to be able to trade (whatever they may be because my value is in companies not currency so I can use whichever) and yet good enough there is still a working internet and enough miners for the blockchain to work.


Because it's not an investment but a safety net like gold and silver. Crypto-currencies fans are the younger version of goldbugs.


>because it's not an investment but a safety net like gold and silver

Only if you're a resident of an unstable country.

Can you name a crisis where having a stash of gold and silver mattered? Do you think people are going to trade valuable goods (food? water? ammo?) for your metal bars? I can't imagine the circumstances.

When SHTF the government (or someone else) will confiscate that wealth. They have in the past. Personally, I think metals will matter less in any apocalypse, because they have no practical use.


As a Russian, I have survived the USSR economic collapse. Having a stash of gold would be handy (dangerous, as it would have put a mark on your back, but still preferable to holding any amount of Soviet money, which became worthless in mere months.) Gold was traded for great value in the harshest of times there.


Cypress is a stable and prosperous country, but they had banks crisis and their bank savings were confiscated to prop up the banks.


Cyprus is a country with a wall running across one corner of it which operated its financial industry as a tax haven, overbalancing the economy. Savings in excess of the insured level (€100k) took a cut (8% I believe).


I think the most valuable thing you can possibly own in a full blown collapse situation is a well stocked seed bank.


You don't need anything except potatoes and fast-growing greens to survive. Grain and rice are too labor-intensive and generally require a functioning economy.

(And if you don't have guns and ammo, you'll be immediately robbed by those who do)


>Anyone have a good source for that number?

You can get close with a few ETFs: US market and bonds, Ex-US global market and bonds:

http://www.pragcap.com/a-simple-four-fund-global-financial-a...


Those are ways to invest in that total number. I already do that. I mean an information source for the total valuation of the world's stock markets on a monthly basis at least.


I am betting on Bitcoin market cap (roughly, adoption rate, for any reason) to grow faster than the total number of Bitcoins in circulation (which is growing logarithmically and capped by 21 million)


> government retirement schemes

This is your weekly public service announcement.

Social Security is not an investment, it is an insurance. The goal of Social Security is not to make everyone rich but to keep anyone from being destitute.

This has been your weekly public service announcement.


My goal is not to make myself rich, but to put some funds somewhere they can't be seized, being accessible only by me. I am using a scrypt brainwallet for that (all precautions taken, with paranoid scrypt settings).

I am not aiming for becoming very rich for that — my goal is personal security. But thank you for your concern.


This depends on your government and its pension schemes - the UK operates both a minimum pension and a state-run contributory scheme.


Is this for the speculation of the value increasing, or tied to another reason? You're of course aware of the potential value increase and how that benefits you?




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