Along with this gem: https://news.ycombinator.com/item?id=6858258
In summary, I invested $11k @ $1106/coin, predicting it'd rise to $1,500.
Shazam! I've transmuted that $11k into... let's see ... $5,100.
I feel pretty ill. Thought you'd all enjoy the schadenfreude, and perhaps learn from my example: "How to ignore Sam Altman and lose more than half your money."
EDIT: I'm holding onto my coins. But, now that China is strongly incentivized not to invest in Bitcoin, it's going to be a very slow climb back to $1106. And at the end of that long road (I'd say at least several months, but what the hell do I know, right?) I get to look forward to: "Yay. I've lost $0. I've also gained $0."
EDIT2: Oh, nope! It just fell from $520 to $500. So, at current market prices, my $11k is now $4,780. Of course, we've all seen bitcion dip and quickly rise again. It's just very... interesting... to me that within the timespan of writing a HN comment, I'm down another $320.
Yes. Interesting. That's the word. I'm interested. In learning from my mistakes.
FYI, that -$5,900 was enough to pay off my car loan in its entirety, or all of my (admittedly small, relatively speaking) credit card debt.
Oh well. I'm going to go build a product and sell it now.
EDIT3: The market rose from $500 to $540, so that means I've earned back $474! And since my last edit was an hour ago, that must mean I'm earning $474/hr writing HN comments in my pajamas! Why hold down a programming job when you can write HN comments fulltime for 4x the wage? Quit tomorrow, sell everything you own, and invest it all in bitcoin immediately!
Your sense of humor is worth its weight in gold. I've just bookmarked your comment as a reminder of "survivorship bias," how people can look back at any arbitrarily chosen period of their lives as evidence of their successful reasoning and planning.
Yeah, being a bit older than most participants here and remembering earlier gold booms and busts, and earlier technology stock booms and busts, and so on, means that I'm a bit less excited at each new Best New Hack Ever™ that comes along. Hot-blooded younger people will continue to ignore me, but that too has happened often enough in the past that I don't let it get to me. Good luck in building your product. I'll be glad to buy new products built by young people as they gain wisdom.
To all our friends here: "Markets can remain irrational a lot longer than you and I can remain solvent" is still good investment advice.
A favourite pass-time of mine is reading old business and financial newspapers. I remember vividly the bubbling joy and aching pain I felt as the EU and European Monetary Union came together, as in the shining future The Economist saw for the citizens of 1920.
That juxtaposition of exuberant optimism and the knowledge of cold reality has been a good template for walking through possible outcomes as if they are known eventualities. The process tends to leave one considerably soberer than at the start.
And it's even for an amount you can afford to lose in the long run! You're a lucky man. That's much better than betting the house after losing your job in your mid-life crisis.
Just take the opportunity and pay very close attention to your emotions and what triggers them. Awareness of that is what will make you a better investor in the long run and, whether we invest time or money, we're all investors in the end.
what was your rationale for investing in the first place? Was it following some person on the internet? Or was it because you believed in the bitcoin craze? Or was it because you believed that Chinese demand would drive up BTC? Or some other reason?
The way to learn from your mistakes is to sit back and understand why you bought BTC in the first place, and then try to understand what went wrong (treat this like a scientific experiment)
Prior to buying the coins that is.
 Missed the edit window by this much.
But I think most importantly, a mutual fund is much more liquid than a car (or a house).
If I had the choice between pre-paying $11,000 towards a car loan and sticking money in the bank; I would probably choose to stick it in the bank or a mutual fund. I always have the option of paying down a car loan if I want, but once I pay it down, I no longer have the cash. Stuff happens, and the utility of having the cash is more than potential savings from not paying a small amount interest for a few years.
I'm longterm bullish on BTC, so a low price is an opportunity to buy, not a time to beat myself up for timing the market wrong. Of course, I could be wrong in my bullishness. It could all fall apart, or one of the other cryptocoins could prove to be "the one" (though I tend to think most are just also-rans and can and should be ignored). But, I'm absolutely confident a cryptocurrency, of some sort, is absolutely the future. It's one of those unstoppable forces, I think, and as long as the number of people preferring it to USD (or other fiat currencies) keeps rising, the real value (not the exchange value) of BTC is going to keep going up. I want as much of that future as I can afford.
Please don't do this. No matter how confident you are in your investment thesis it doesn't ever justify 100% allocation into a single asset - that implies infinite confidence.
I am only investing money I can afford to lose. I don't want to lose it, but I won't starve if I do.
This is a crazy and interesting time to live in, and I'm glad I'm still here even if Bitcoin didn't make me rich.
Personally, my future looks good enough even if I never buy any bitcoin. If buying bitcoin makes you worry and possibly risk depression and suicide, you'd better stay out. Yes, other people are getting rich somewhere, but that doesn't have to mean anything to you.There's always someone getting rich somewhere. There's always someone winning the lottery. Do you terrible when someone bought a lottery ticket and won millions? That stuff just happens. Let it go.
If you've got a job paying more than $50k per year, you're still in the richest 1% of the world. Don't worry so much. You're doing very well.
Upon first discovering SIP addresses and that everybody on earth could have an email style phone number that would be free to call, I have been waiting and waiting for the world to transition to SIP addresses instead of phone numbers.
If such a thing occurs, someday, then publishing a phone address from one country will not be a problem. I'm sure the folks at the suicide hotline would gladly take calls from anywhere in the world, if they could do so for free. Sadly, as things stand now, they could publish a SIP address, but nobody would know how to use it.
Ended up pointing out to myself, hey if I had the power to go back in time, I wouldn't spend it going back to 2011 to get rich, I'd spend it going back to 1920 to kill Hitler. If I don't feel bad about not being able to do that, there's no point feeling bad about not getting rich on Bitcoin either.
As you say, it's a crazy and interesting time to live in.
It's quite possible to make bad decisions that turn out well and good decisions that turn out badly.
To learn the correct lessons, he needs to work out if his original plan was sensible given what he knew (or could reasonably find out) at the time and he's just unlucky, or if the decision to invest was reckless or based on inadequate or wrong information.
Having said that, it's so easy to deceive ourselves, that I've heard people say that it's a good idea to work out what would falsify your assumptions before investing.
The decision he made was either a good one or a bad one based on the information available to him at the time. That will be true regardless of whether he becomes a billionaire in the next month or goes entirely broke.
The true lesson to be learned is not dependent on the outcome.
But that wager makes no sense at all since people accidentally delete there wallets all the time and there's a limited supply of bit-coins.
If you factor in time bit-coin can only go up as long as people are still using it and i have confidence bit-coin will reach wide adoption.
I hope it doesn't end up so, luckily I'm not in a position where I need to try and work it out!
Bitcoins are up against some really big competitors called nation states and supranational unions. It's almost like trying to run a private army. Once you get big enough to impose a threat you will be outlawed, one way or the other. There is no power, no legislature behind bitcoins, so bitcoin holders will lose the regulatory game.
Nation states use their traditional currencies in monetary policies and they depend on their currencies for tax revenues. Not being able to control the amount of bitcoins and not being able to tax them effectively because they flow outside of institutions that can be controlled and because transactions are encrypted means that the bitcoin is a threat to nation states.
Danish tax authorities are currently looking into how bitcoins should be taxed and I think they will follow the Norwegian example and tax them as assets. Most important governments will eventually make life hard on bitcoins either by outlawing them flat out, by out-taxing them or in other ways.
I agree entirely BUT I can see how someone might be misled by all the bitcoin cheerleading.
I don't. Every time I see the comments on BTC articles, I get the impression the groupthink among BTC optimists is so strong it effectively kills their ability to form an individual opinion. I mean, seriously, why on earth would anyone in their right mind ever think an 'asset' (which isn't even an asset) can rise 200x within a year and not be one gigantic bubble, just because the BTC echo chamber says it's 'the currency of the future', despite the fact that ~100 people hold over ~50% of all BTC, and not much more than 1% of BTC transfers are actually used for actual trades? I'm really lost for words when it comes to the naivity of people (still) holding BTC.
But go ahead, buy the dip, hope for the best, I mean, Winklevoss says it will go to $40K :-/
So you're in good company.
If you don't decide what you think something is worth, your subjective experience of investing in it will be a rollercoaster. If you do choose a price target, then you know where you stand at all times, and whether you should buy or sell.
As well as choosing a price target, you should choose a set of situations that will falsify your price target so you aren't committed to losing all your money on one bet if you're wrong.
Lessons learned: timing investments is really hard. Trying to buy from the bottom can be equally stupid.
Personal story: I got a bit of play money when we were acquired. Naive me thought that I understand how the world works. The first months of finance crisis had just happened. In US and selected European countries real estate prices had dropped, but in Finland market hadn't crashed. I reasoned that they eventually will, and it's a bad time to buy an apartment, but a good time to invest to finance stocks because they had already crashed. Among other investments I bought some Citibank stocks -"they are the largest, thus probably the safest". Boy I was naive.
Real estate prices in Finland never crashed, Citibank's free fall had just only started.
How did you expect the price to keep climbing ? Now you need to wait a few weeks/month until we go back to the normal trend.
Made a nice profit a year later.
There's not a lot of options it's either risk it or watch your money slowly rot away.
I'm in a similar boat as you though so... dem feels.
The decision has paid off, i sold at ~1000$.
The worst thing you can do is sell now. BTC is extremely volatile, it might go down to $100, but one day it'll be $1,000 again.
But can you stomach the possibility of throwing good money after bad? After all, other states could start following China's example.
If it continues to gain adoption, those coins will rise in price again (don't let temporary drops get to you too much).
Just hang in there :)
It's only a loss if you sell it now and never buy bitcoins again, or if this is the highest price bitcoins will ever reach.
Still, if China is really getting out of bitcoin, how much does that past performance still eman?
Here's the same content from a non-paywall provider: http://www.scmp.com/business/banking-finance/article/1384688...
You can test this yourself:
If I click through from here I get a silly question and the content:
Here is another article: http://www.scmp.com/business/banking-finance/article/1384688...
While I agree with your assertion that governments have no reason to support Bitcoin, I don't believe it follows that government sponsorship is necessary for the success of Bitcoin. I suspect most people betting on Bitcoin are aware that at some point, governments are going to act forcefully to kill Bitcoin, and the fallout will be utterly unpredictable.
But, I don't think it's something that can be put back in the bottle. We're crossing into uncharted waters here. Nothing like Bitcoin has ever happened before...so, we don't know how it's going to play out. I'm bullish even with the expectation that major world governments will collude with current financial elites to kill Bitcoin, because I suspect there is no way they can actually kill it.
I don't think so. I think it's quite predictable that, if that happens, Bitcoin will lose. In the sense that it will ultimately become a cryptocurrency also-ran. Something else will probably rise to take its place after it's been bloodied, something designed to be resistant to whatever response the world's governments bring to bear.
Why would China want this? The current system works in their favor, even they admit RMB isn't ready to be a world currency yet by disallowing full convertibility.
> but central banks lose their power to control the money flow in the system
Exactly. Also, this is a big loophole over the RMB's non-convertibility limitation/feature.
Any insight into how foreigners take positions in the Chinese economy with RMB they obtained through USD->Bitcoin->RMB transactions?
- Currency: easy, as you just need a passport to open a bank account
- Starting a company: harder, as I thought that opening a WFOE required the capital to be injected in a specific way at a specific step in the process
- High interest deposits: these seem either risky (some of the bonds sold by banks) or unavailable to foreigners (yu'ebao 余额宝)
- Real estate: some cities require a hukou or minimum duration of residence
- A shares: need to be a PRC national
- Angel investments and unofficial loans to small businesses?
Honestly, I don't know what the reason for incoming hot flows are, just that they have been a problem in the past. There are obviously good investments to be had here if you are well connected.
Regardless of the Chinese government's ability to effectively enforce such a ban, the price of Bitcoin has begun another wild (and fascinating) price fluctuation period.
If you click through from Google, you will probably see the article text.
If you invest because you believe in the underlying technology, you'll have to ride out the volatility waves until it matures(or dies).
But, it's going to take more than people holding onto their bitcoins and waiting for the value to go up- people need to spend them on things for it to work.
Can't get to the article...