Bitcoin in the PP?

[Smith1776]

How long is the vetting process?

I say at least 100 legit looking posts and at least 50 of them have to be praise for Craig/Tex/PP.

[europeanwizard]

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

[pmward]

1% allocation is not enough to lose sleep over. Now, it's highly likely that it's not going to continue going up at the rate it has historically, so 1% also might not be enough to move the needle up either. But, I see no reason why someone can't allocate 1% of their portfolio to a moon shot.

[Medolark Lemon]

or real person sucked in by clickbait asking an honest question? i am going to give benefit of the doubt for a moment. if the account doesn't engage in an actual conversation in a reasonable amount of time i will take care of it...

Real person asking a genuine question lol... I havent really read up on the forum rules so not sure if you aren't allowed to post links.

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?

welcome to the forum... no rules against posting links, 98% of the time links on a first post are spam bots, sorry for the suspicion..
my best guess on response to bitcoin in a pp will be "bitcoin in the VP sure go for it" - "it has potential but its to young/new for pp at this point" "RUN AWAY RUN AWAY" " and "love the cripto anarchist non government money side but as an investment not so much" i personally would say 1,2,and 4..

thanks for the response, I can definitely understand the viewpoints

[Medolark Lemon]

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

Ahh i see, yeah that makes sense. I have seen a couple other people mention a "VP" and didnt know what it meant. I like that idea, have my PP to keep honest and stay away from market timing and then a VP as well as I naturally have always been interested in alternative investments as well (even if it may be sort of a moon shot)

[dualstow]

If ML is a bot, so am I.

So you finally admit it.

pugtron

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EDIT: resized image

[Libertarian666]

I'd rather add Beanie Babies to the PP.

[l82start]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

[Libertarian666]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

Got me. That was just a figure of speech.

[vnatale]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

I'd head to eBay to see what they are worth...

Vinny

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[bitcoininthevp]

Did someone flash the Bitcoin signal in the sky?!

I proposed a version of the PP with 24/24/24/24/4 allocation (with 4% being in Bitcoin). But it is really more for fun and also the same as a normal PP with a Bitcoin sidecar in the VP. Im a huge long term Bitcoin bull, but the only way it makes any sense in the PP context is putting the Bitcoin in the variable portfolio.

viewtopic.php?f=1&t=9347&p=167356&hilit=name#p167356

Even if you think of Bitcoin as the worlds "third favorite money" (which it isnt yet) and it eating out of some of golds value proposition, it is still a speculation.

To be completely clear Im talking specifically about Bitcoin here. Stablecoins (USD equivalents), utility tokens (like ETH), and less sound
cryptocurrency attempts at "money" (like LTC) are not valuable long term IMHO.

[bitcoininthevp]

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

In the radio shows or elsewhere Harry mentioned that if you are going to speculate in the VP it is best to be outsized bets with high potential returns.

via An (Institutional) Investor’s Take on Cryptoassets
https://s3.eu-west-2.amazonaws.com/john ... ets+v6.pdf

Regarding risk, an investment with a 20x – 60x upside only requires a probability of
success of between 2% to 5% to be a positive net expected value investment. Each of us can
reflect on his own view of what that the probability is of the foregoing scenario materialising.
I’m personally pretty comfortable that, given where we are today in Bitcoin’s development
and adoption, that the probability is higher than 2 – 5%, likely much higher. While there are
many technical, political, regulatory and psychological hurdles ahead, the store-of-value use
case is by far the simplest one, and already closest to reality. I would argue therefore that
here you have an investment with a downside:upside skew of -1x : 60x and a positive net
expected value. Investments with both those characteristics are extremely rare.

He is specifically talking about Bitcoin replacing a certain % of gold here. Recommended reading the full PDF if you are curious.

[bitcoininthevp]

I'd rather add Beanie Babies to the PP.

Still waiting for an intellectual criticism from you.

Every thread on Bitcoin you spin the wheel-of-bitcoin-attempted-insults-from-2013 and pull out tulips or beanie babies or some nonsense without adding any value to the thread.

Reminds me of close-minded Boglers trying to insult gold as a useless shiny rock without ever trying to understand it.

And I would add you are also devaluing any of the contributions you make elsewhere on the forum doing this.

[Libertarian666]

I'd rather add Beanie Babies to the PP.

Still waiting for an intellectual criticism from you.

Every thread on Bitcoin you spin the wheel-of-bitcoin-attempted-insults-from-2013 and pull out tulips or beanie babies or some nonsense without adding any value to the thread.

Reminds me of close-minded Boglers trying to insult gold as a useless shiny rock without ever trying to understand it.

And I would add you are also devaluing any of the contributions you make elsewhere on the forum doing this.

I understand bitcoin just fine. Blockchain in general has the potential of revolutionizing commerce, but that doesn't mean that bitcoin is worth anything as an investment.

As soon as bitcoin as an investment has 10th of the length of the track record of gold, I'll consider it as an investment.

In the meantime, feel free to ignore my messages on this topic, as I generally ignore yours.

[bitcoininthevp]

feel free to ignore my messages on this topic

Ill ignore what has no value. Like your one line beanie baby posts that are a waste of electrons. I dont mind criticisms, discussions, or arguments as perhaps one of us learns something.

Blockchain in general has the potential of revolutionizing commerce

Ok, the blockchain not Bitcoin argument. Help me understand in what context blockchain has or can be applied that is a better context than being applied to money (Bitcoin)?

Blockchain, to me, only makes sense in a censorship resistant context. For Bitcoin (money), that means central banks inflating the money supply against the will of the users, censoring/preventing transactions of users, or confiscating/freezing funds of users. Bitcoin and blockchain "solve" these issues in the money context. (I use "solve" in quotes as I fully and humbly realize Bitcoin is a web of incentives for humans and that at some point those incentives could break down in some way)

In your example, what commerce is being censored that a blockchain will help solve? What comes to my mind are things like black market transactions where the government says you cant sell drugs or something of the sort. But with Bitcoin, as outlined above, can help get around censored transactions.

So help me understand then the context where blockchain can be applied, that isnt money, having to do with commerce being revolutionized?

[Medolark Lemon]

feel free to ignore my messages on this topic

Ill ignore what has no value. Like your one line beanie baby posts that are a waste of electrons. I dont mind criticisms, discussions, or arguments as perhaps one of us learns something.

Blockchain in general has the potential of revolutionizing commerce

Ok, the blockchain not Bitcoin argument. Help me understand in what context blockchain has or can be applied that is a better context than being applied to money (Bitcoin)?

Blockchain, to me, only makes sense in a censorship resistant context. For Bitcoin (money), that means central banks inflating the money supply against the will of the users, censoring/preventing transactions of users, or confiscating/freezing funds of users. Bitcoin and blockchain "solve" these issues in the money context. (I use "solve" in quotes as I fully and humbly realize Bitcoin is a web of incentives for humans and that at some point those incentives could break down in some way)

In your example, what commerce is being censored that a blockchain will help solve? What comes to my mind are things like black market transactions where the government says you cant sell drugs or something of the sort. But with Bitcoin, as outlined above, can help get around censored transactions.

So help me understand then the context where blockchain can be applied, that isnt money, having to do with commerce being revolutionized?

Yeah I tend to be of the same thought process. From what I can tell a blockchain is rather inefficient, a centralized third party would probably be better for most online commerce options, but when you need an extremely secure digital ledger like money a blockchain seems useful. Also when it comes to a blockchain you literally need a token/item/money to incentivize security of the network by rewarding the miners with it so the idea of a blockchain that isn't specifically designed towards being a money doesn't make much sense to me.

I like that idea of 24/24/24/24/4.

[bitcoininthevp]

I agree with your points. And welcome to the forum! (sorry the others gave such a harsh welcome)

Blockchains are terribly inefficient. The only time youd use one is if the decentralization/censorship resistance that you require absolutely necessitate it.

A group of companies working together can form a (centralized, technologically-efficient) consortium/federation instead. If they largely trust each other.

If there is a question of being able to prove something, there are also cryptographic tools like hashes that can help with that even with a traditional database without needing a blockchain. Such techniques have been around for decades.

[I Shrugged]

I have never heard of such a strategy, but after your post, I will watch a couple of videos on YouTube about this topic, you have seriously interested me in this. In general, I have developed my own strategy for buying cryptocurrency. I do not buy an expensive cryptocurrency like bitcoin and so on. I believe that it is necessary to buy such a cryptocurrency as dogecoin or Vaffa Token, which currently costs a small amount of money, but in the future, I assure you, this cryptocurrency will bring me a lot of money. I was advised to do this by several businessmen who have been investing for a long time.

That’s hilarious in the overall context of the last two pages.

[vnatale]

I have never heard of such a strategy, but after your post, I will watch a couple of videos on YouTube about this topic, you have seriously interested me in this. In general, I have developed my own strategy for buying cryptocurrency. I do not buy an expensive cryptocurrency like bitcoin and so on. I believe that it is necessary to buy such a cryptocurrency as dogecoin or Vaffa Token, which currently costs a small amount of money, but in the future, I assure you, this cryptocurrency will bring me a lot of money. I was advised to do this by several businessmen who have been investing for a long time.

That’s hilarious in the overall context of the last two pages.

I am assuming that annalonco is no longer with us?

[Xan]

When was that post? I wonder if they managed to hold onto doge.

It was yesterday, from a spammer, pushing some particular e-coin. The link gives it away (I redacted the destination).

[Kbg]

Down almost 66% since November 2021...

[Arthur Boe Nansa]

Down almost 66% since November 2021...

kbg don't you know that dollar valuation is just an illusion? There's only 21 million Bitcoin and 1 sat = 1 sat, so Bitcoin's value remains immutable. The repricing of everything around it is the fault of mismanaged financialization. The purity of Bitcoin is everlasting, it is the only constant in a dynamic world.
In the words of his holiness Michael Saylor: "#Bitcoin is a swarm of cyber hornets serving the goddess of wisdom, feeding on the fire of truth, exponentially growing ever smarter, faster, and stronger behind a wall of encrypted energy."

If you don't understand this, you do not understand economics, psychology, philosophy, and everything that defines the future of humanity. You are, as the kids say, Not Gonna Make It.
Few understand this.


Joking aside: I've said it before and i'll say it again. Sans utility, Bitcoin can be anything you want it to be. It has been called a monetary network, a unit of account, a store of value, a beacon of hope for the disenfranchised[1], the one stop shop for all things web5[2], etc. It has little to no proof of being literally any of those things, but BTC'ers will convince you "it's only a matter of time. It's inevitable." Those of us who actually believe in using cryptocurrencies for doing good, and creating real change, have moved on to other projects. They're not perfect, but they're actually trying to deliver a use case.

______________

For those who want to read my observations:

[1] Consider what i'll call the Fictitious Freedom Paradox. Isn't it strange that most of the the states/countries adopting Bitcoin are economically weak, relatively underdeveloped and have had checkered governmental histories? These are the places ushering the new age of personal freedoms? You'd think a country dedicated to the prosperity of it's people would lower barriers to entry and provide sensible opportunities while still keeping an eye on growing systemic changes (you know, what governments are supposed to do) and allowing the citizens to decide freely. Instead, you have politicians lavishly broadcasting their acceptance of Bitcoin using a top down approach that feels almost too convenient. It's as though the governmental adoption is primary, with the potential improvement to its citizens' lives merely an afterthought...
So these governments who have been providing underwhelming results are now the real agents of human progress? You'd have to bake in many assumptions to argue that point convincingly and I think Occam's razor applies here. They simply have little to lose and much to gain (this dynamic is often true of "new paradigms", especially when the earlier you are, the more you stand to gain). So to sum up the Fictitious Freedom Paradox, those that score lowest in promoting the rights and freedoms of their citizens are somehow the greatest proponents of Bitcoin and the free utopia it enables.
Even if you wanted to ignore all that, you can very clearly see the deteriorating situation of El Salvador. Not only has their Bitcoin adoption been controversial, but their federal holdings are at a serious loss and their Bitcoin Bonds have been delayed twice (despite claiming to be oversubscribed), all while the internal state of affairs (gang violence, crime, etc.) has only grown more chaotic. BTC'ers would have you believe that Bitcoin solves these problems, but the evidence shows otherwise.

[2] I won't go into it too much detail, but Jack Dorsey, cofounder and previous CEO of Twitter, has announced an initiative to bring "web5" to Bitcoin. The idea is to build the future of the internet over "the rails" of the Bitcoin blockchain. It is meant to be an end all be all solution to dwarf all the hundreds of projects and companies that have spawned over the last few years in the tech and crypto industry. Jack, after having decided that he does not want to associate with the common VC's of Silicon Valley, is biting his thumb at the industry that put him where he is. He was CEO for years and yet somehow asleep at the wheel, not providing much shareholder value despite golden opportunities to advance the success of Twitter as both a company and platform. And now only half a year since stepping down, Dorsey has considered being part of Elon Musk's plan to take Twitter private. Musk cites much of the issues plaguing Twitter and vocally explained the importance of preserving "the de facto public town square", a company Dorsey was in charge of FOR YEARS. And yet somehow Musk directs the blame at its current management? All this is to say that while I think Dorsey's intentions are well meaning, they are wholly misguided and rest on somewhat hypocritical foundations.

A final note: Lyn Alden has been the queen of macro finance, providing illuminating insight and charts relating to where we are and where we're going. Yet one of the most interesting trends she has conveniently kept away from the spotlight- that BTC's correlation to the SP500 has been reaches new all time highs. An asset that is somehow supposed to be a ballast against inflation, lax monetary policy, and economic uncertainty is increasingly becoming a more volatile proxy for equities. She is a great commentator, but not without her faults and biases. Had she been more objective she'd report it much the same as everything else she does, but she's awaiting approval of "what's the current narrative?" from the influential people in the BTC community before posting to her audience information that might hurt the overall message. A user here (whose name escapes me) asked me to explain my comments i've made about her in the past. This is another glaring example. The user has since deleted their posts/account, but I get the feeling they still lurk in the forums from time to time. If they are reading this...hope all is well!

[Kbg]

Joking aside: I've said it before and i'll say it again. Sans utility, Bitcoin can be anything you want it to be. It has been called a monetary network, a unit of account, a store of value, a beacon of hope for the disenfranchised[1], the one stop shop for all things web5[2], etc. It has little to no proof of being literally any of those things, but BTC'ers will convince you "it's only a matter of time. It's inevitable." Those of us who actually believe in using cryptocurrencies for doing good, and creating real change, have moved on to other projects. They're not perfect, but they're actually trying to deliver a use case.

By no means would I ever claim any expertise in this area, but I will claim just a small amount of financial expertise and as an investment or a monetary instrument cryptocoin of any kind is and always has been essentially a massive scam and/or criminal enterprise. If one understands anything about "money" how it works, who controls it and what its operating principles are they know the following: Crypto isn't going to survive as "money." As an "investment" it has zero redeeming qualities to it. It produces nothing and returns nothing. Its "scarcity" lasts until it gets forked which can happen when the controlling technical entities decide to make a change.

On the positive...I've no objection to speculation and it has been a massively good speculation in both directions if you are good at timing its moves and the technology genuinely appears to have superior qualities as an accounting technology.

[bitcoininthevp]

[1] Consider what i'll call the Fictitious Freedom Paradox. Isn't it strange that most of the the states/countries adopting Bitcoin are economically weak, relatively underdeveloped and have had checkered governmental histories? These are the places ushering the new age of personal freedoms? You'd think a country dedicated to the prosperity of it's people would lower barriers to entry and provide sensible opportunities while still keeping an eye on growing systemic changes (you know, what governments are supposed to do) and allowing the citizens to decide freely. Instead, you have politicians lavishly broadcasting their acceptance of Bitcoin using a top down approach that feels almost too convenient. It's as though the governmental adoption is primary, with the potential improvement to its citizens' lives merely an afterthought...
So these governments who have been providing underwhelming results are now the real agents of human progress? You'd have to bake in many assumptions to argue that point convincingly and I think Occam's razor applies here. They simply have little to lose and much to gain (this dynamic is often true of "new paradigms", especially when the earlier you are, the more you stand to gain). So to sum up the Fictitious Freedom Paradox, those that score lowest in promoting the rights and freedoms of their citizens are somehow the greatest proponents of Bitcoin and the free utopia it enables.
Even if you wanted to ignore all that, you can very clearly see the deteriorating situation of El Salvador. Not only has their Bitcoin adoption been controversial, but their federal holdings are at a serious loss and their Bitcoin Bonds have been delayed twice (despite claiming to be oversubscribed), all while the internal state of affairs (gang violence, crime, etc.) has only grown more chaotic. BTC'ers would have you believe that Bitcoin solves these problems, but the evidence shows otherwise.

Doesn’t seem that paradoxical to me. Any country that can print their own currency is not likely to adopt BTC. So you are left with non-printing countries as more likely BTC adopters. Of those non-printers, the ones closest/friendliest/under-the-thumb of the US (or other money printers) are the least likely to adopt as well. So you’re left with these el salvador-types (dont have their own currency, not tight with USG or others) as the most likely adopters. That seems logical to me. I dont personally agree with the legal force requiring adoption and I think the president "buying the dip" and acting hot shot on twitter isnt great (but popcorn-level enjoyable).

I dont really have any thoughts on your @Jack takes. Seems like a good guy, seems like hes trying help bitcoin and build services around it.

...Yet one of the most interesting trends she has conveniently kept away from the spotlight- that BTC's correlation to the SP500 has been reaches new all time highs. An asset that is somehow supposed to be a ballast against inflation, lax monetary policy, and economic uncertainty is increasingly becoming a more volatile proxy for equities.

Bitcoin was actually a pretty great monetary inflation hedge (went up a lot during money "printing" in the last years), and not a good CPI hedge, esp during tight money.

As it seems the monetary inflation has stopped and we are in tightening money mode it makes sense to me that BTC would be punished accordingly. Pain is likely to be strong for BTC, and exacerbated by the crypto worlds nuances like leverage/LUNA, until whatever we expect the Fed pivot event to be.

In terms of tracking S&P500/Nasdaq, "correlations go to 1" when there is a rush to the exits and whatnot.

[glennds]

Bitcoin was actually a pretty great monetary inflation hedge (went up a lot during money "printing" in the last years),

I'm still wondering if this was causation or random correlation.

I keep reading things from BTC aficionados that the price cycles have a lot to do with "halvings" and adoption. I don't claim to fully understand the phenomenon, but I don't think it has any relationship to inflation, monetary or price.
So if you're right, they're wrong and vice versa, or you're both wrong. Maybe there is no rational answer for Bitcoin's movements.