Bitcoin investors are running from the crypto to invest in gold

Discussion of the Gold portion of the Permanent Portfolio

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Ad Orientem
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Bitcoin investors are running from the crypto to invest in gold

Post by Ad Orientem » Sat Jan 26, 2019 3:55 pm

Bitcoin's hot streak is well and truly dead.

The cryptocurrency has not been able to crack above $4,000 in three weeks just 12 months after trading at more than $12,000.

Signs show that bitcoin investors are moving toward a more traditional commodity, says Jan Van Eck, CEO of Van Eck Associates.

"I do think that Bitcoin pulled a little bit of demand away from gold last year, in 2017," Van Eck told CNBC's "ETF Edge" on Wednesday. "Interestingly, we just polled 4,000 bitcoin investors and their number one investment for 2019 is actually gold. So gold lost to bitcoin and now it's going the other way."

In the 12 months to bitcoin's peak above $20,000 in December 2017, the cryptocurrency increased in value 25 times over. Over that same stretch, gold rallied 4 percent. More than a year since bitcoin's peak, it's down 82 percent, while gold is up 2.5 percent.

It may be difficult for the tide to turn back to bitcoin and away from gold from here, says Tim Seymour, founder and chief investment officer of Seymour Asset Management.

"Not only have we lost all liquidity on the underlying [commodity] but truly outside of the existential blockchain argument, it's been very difficult to argue store of value which is really what we started hearing about," Seymour said on "ETF Edge" on Wednesday. "Gold is a store of value and there's no disputing that."
Read the rest here...

https://www.cnbc.com/2019/01/26/bitcoin ... odity.html
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ochotona
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by ochotona » Sat Jan 26, 2019 8:31 pm

My barber put lots of money into crypto a year ago. I tried to warn him.
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Ad Orientem
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Ad Orientem » Sat Jan 26, 2019 9:37 pm

ochotona wrote:
Sat Jan 26, 2019 8:31 pm
My barber put lots of money into crypto a year ago. I tried to warn him.
:(
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by sophie » Sun Jan 27, 2019 10:12 am

Ad Orientem wrote:
Sat Jan 26, 2019 3:55 pm
Read the rest here...

https://www.cnbc.com/2019/01/26/bitcoin ... odity.html
I figured that would happen sooner or later. Remember dualstow's experience with bitcoin? Too easy to get hacked, or lose your password or have something happen on the server side. Anyway, fantastic if gold is temporarily depressed because of this flirtation with crypto. It means it's been on sale for the past few years, and we've all been taking full advantage.

However, be really careful about taking a guy too seriously who equates gold miners with gold, and bases his idea of gold's position in a portfolio based on the last "two or three months":
If gold shares do get a bid this year, one of the ways to play it is through gold ETFs, says Van Eck. His firm created the most well-known gold ETFs: the GDX gold miners ETF and GDXJ junior gold miners ETF.

“The shares have been acting tremendously well over the last two or three months … It’s starting to zig when the stock market zags,” Van Eck said. “In the majority of the days in Q4 when the S&P was down, GDX was up. So that zigzag, that decoupling makes me really excited about gold shares as a diversifier.”
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by ochotona » Sun Jan 27, 2019 10:43 am

sophie wrote:
Sun Jan 27, 2019 10:12 am
However, be really careful about taking a guy too seriously who equates gold miners with gold, and bases his idea of gold's position in a portfolio based on the last "two or three months":
If gold shares do get a bid this year, one of the ways to play it is through gold ETFs, says Van Eck. His firm created the most well-known gold ETFs: the GDX gold miners ETF and GDXJ junior gold miners ETF.

“The shares have been acting tremendously well over the last two or three months … It’s starting to zig when the stock market zags,” Van Eck said. “In the majority of the days in Q4 when the S&P was down, GDX was up. So that zigzag, that decoupling makes me really excited about gold shares as a diversifier.”

He's talking his book. He offers GDX, GDXJ.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by buddtholomew » Mon Jan 28, 2019 7:25 pm

Oh boy, good old GDX.
I think every time period from inception the fund has been -ve.
Bought my first batch at 37 and last batch at 18 and change several years ago.
What a peach >:D
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ochotona
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by ochotona » Mon Jan 28, 2019 9:48 pm

buddtholomew wrote:
Mon Jan 28, 2019 7:25 pm
Oh boy, good old GDX.
I think every time period from inception the fund has been -ve.
Bought my first batch at 37 and last batch at 18 and change several years ago.
What a peach >:D
The miners have destroyed so much capital...
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Tue Jan 29, 2019 7:32 am

ochotona wrote:
Sat Jan 26, 2019 8:31 pm
My barber put lots of money into crypto a year ago. I tried to warn him.
He's going to take a haircut on that investment.
traveling...
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Cortopassi » Tue Jan 29, 2019 7:56 am

ochotona wrote:
Mon Jan 28, 2019 9:48 pm
buddtholomew wrote:
Mon Jan 28, 2019 7:25 pm
Oh boy, good old GDX.
I think every time period from inception the fund has been -ve.
Bought my first batch at 37 and last batch at 18 and change several years ago.
What a peach >:D
The miners have destroyed so much capital...
Got out of them completely when I switched to the PP in 2014. Agreed. I don't think I ever had a positive trade with either GDX or GDJX. Just always seemed to entice me at the perfectly wrong times.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Tue Jan 29, 2019 1:31 pm

In the 12 months to bitcoin's peak above $20,000 in December 2017, the cryptocurrency increased in value 25 times over. Over that same stretch, gold rallied 4 percent. More than a year since bitcoin's peak, it's down 82 percent, while gold is up 2.5 percent.


Does this mean that during this timeframe a $100.00 portfolio (100% bitcoin) would be $450.00 today?... vs a (100% Gold) would be $106.60...?
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Wed Jan 30, 2019 8:59 am

Another question....would bitcoin be considered a good long term SOV since inception if we only looked at its yearly lows instead of highs?

Yearly Lows:
2012 -$4
2013 - $75
2014 - $200
2015 - $185
2016 - $365
2017 - $780
2018 - $3200
2019 - TBD - Currently $3400
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Wed Jan 30, 2019 3:08 pm

gaddyslapper007 wrote:
Wed Jan 30, 2019 8:59 am
Another question....would bitcoin be considered a good long term SOV since inception if we only looked at its yearly lows instead of highs?
It's an iffy store of value, period.

I like the idea of what it was originally intended for, just a frictionless medium of exchange. As an investment or store of value...most vendors and individuals simply don't accept it. It's like it was made primarily for ransomware.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Libertarian666 » Wed Jan 30, 2019 4:05 pm

I'm sure Bitcoin will come roaring back soon!
Just like Beanie Babies!
;)
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Wed Jan 30, 2019 4:56 pm

dualstow wrote:
Wed Jan 30, 2019 3:08 pm

I like the idea of what it was originally intended for, just a frictionless medium of exchange. As an investment or store of value...most vendors and individuals simply don't accept it. It's like it was made primarily for ransomware.
I was not soley intended as a frictionless MOE.....it was designed to give people and option outside of government issued fiat cash. A money built on Sound economic principles for the people who freely choose to use it. (digital gold...but better)


The credit card was invented in 1950....how many years did it take for mass adoption? 20-30?...40? I remember the debit card being a big deal in late 90s'....adoption takes time. Time is the magical ingredient.....

Side note:
I was affected by hurricane Harvey in 2017 (we had 3ft of water in home). Believe me when I tell you....gold & silver are heavy burdens (literally & emotionally) to lug around with you at 3:00am through flooded streets to nearby neighbors house you barely know willing to take you in..., then later to hotels and friends houses as you don't want spend to much money & impose your family of 5 on friends too long. The anxiety is relentless....that you'll forget them, where's best place to store them, what if they get stolen, etc... This went on for ~8 months till we were able to move back home and occupy it. So just a heads up for you who love to hold physical yourself....maybe have some back-up plan for your stash if you have to evacuate....come to think of it....I need to do the same... :-\

This life experience is nothing compared to people having to flee ones country's from a tyrannically government...but on a small scale I damn sure came to appreciate Bitcoin's non-physical attributes.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Wed Jan 30, 2019 7:10 pm

Libertarian666 wrote:
Wed Jan 30, 2019 4:05 pm
I'm sure Bitcoin will come roaring back soon!
Just like Beanie Babies!
;)
I’m not sure about soon.....my speculation (let’s see how this ages for the sake of fun)....~September 2019 will start a real slow boring new bull run....(bitcoin is dead in the news stories continue).....then mid 2020 will start the next run up a little more excited like...(you’ll start hearing about bitcoin again)......2021 to 2022 next FOMO event and then bitcoin crashes 80% again....deemed dead again....and setttles around $20k.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Libertarian666 » Wed Jan 30, 2019 8:50 pm

gaddyslapper007 wrote:
Wed Jan 30, 2019 7:10 pm
Libertarian666 wrote:
Wed Jan 30, 2019 4:05 pm
I'm sure Bitcoin will come roaring back soon!
Just like Beanie Babies!
;)
I’m not sure about soon.....my speculation (let’s see how this ages for the sake of fun)....~September 2019 will start a real slow boring new bull run....(bitcoin is dead in the news stories continue).....then mid 2020 will start the next run up a little more excited like...(you’ll start hearing about bitcoin again)......2021 to 2022 next FOMO event and then bitcoin crashes 80% again....deemed dead again....and setttles around $20k.
Once a totally absurd bubble pops, it never comes back. That's because once people realize that it can go down, they stop and ask themselves "What is the actual use value, not the speculative value?" The answer is always "Very little or nothing".

Some examples are tulips, dot-com stocks, Beanie Babies and Bitcoin. There are many others; those are just some of the more famous and/or recent.

The only exception is when such a bubble is reinflated by the government, e.g., the housing market.
Somehow I don't think Bitcoin is going to be among the rare exceptions.

But by all means, sink all you have into it; it will be educational.

As I found out in 1980 when I bought into the silver bubble on the day of the top.
On margin.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Wed Jan 30, 2019 10:32 pm

For anyone interested in learning about bitcoin Andreas Antonopoulos is great source. This is just one video of speech he gave that I plucked from a google search.


https://m.youtube.com/watch?v=ONvg9Sbau ... e=youtu.be

If you never challenged your opinion of bitcoin I ask that you at least give this video a fair / open minded listen. I love what bitcoin can offer people....I’m not saying go all, I’m saying learn about it. That’s what this community does....shares ideas.

I first looked into bitcoin in 2011ish.....scam was my conclusion. There was no Coinbase then....I had to meet some dude at a public place where he would give me BTC and I would give him cash.....No thanks! When I finally took the time and really learned about bitcoin (2013ish).. it seemed like the final piece in the PP puzzle....and then boom! It crashed $1200 down to $200.....just my luck. But the reasons for buying bitcoin still existed then so I kept buying.....those reasons still exist today (only stronger) and I keep buying.

I’ve read this chat forum (as a visitor) learning about the PP for 5 or 6 years and now. Everyone loves to tweak the PP for performance juice...a tiny portion of Bitcoin does this. Bitcoin wedges nicely in the speculative 10% portion. Rebalance annually and enjoy the ride. Worst case it goes $0. As long as your comfortable with that who cares....the rest is gravey!
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Wed Jan 30, 2019 11:00 pm

gaddyslapper007 wrote:
Wed Jan 30, 2019 10:32 pm
For anyone interested in learning about bitcoin Andreas Antonopoulos is great source. This is just one video of speech he gave that I plucked from a google search.


https://m.youtube.com/watch?v=ONvg9Sbau ... e=youtu.be

If you never challenged your opinion of bitcoin I ask that you at least give this video a fair / open minded listen. I love what bitcoin can offer people....I’m not saying go all, I’m saying learn about it. That’s what this community does....shares ideas.

I first looked into bitcoin in 2011ish.....scam was my conclusion. There was no Coinbase then....I had to meet some dude at a public place where he would give me BTC and I would give him cash.....No thanks! When I finally took the time and really learned about bitcoin (2013ish).. it seemed like a perfect complement to the PP....and then boom! It crashed $1200 down to $200.....just my luck. But the reasons for buying bitcoin still existed then so I kept buying.....those reasons still exist today (only stronger) and I keep buying.

I’ve read this chat forum (as a visitor) learning about the PP for 5 or 6 years and now. Everyone loves to tweak the PP for performance juice...a tiny portion of Bitcoin does this. Bitcoin wedges nicely in the speculative 10% portion. Rebalance annually and enjoy the ride. Worst case it goes $0. As long as your comfortable with that who cares....the rest is gravey!
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Thu Jan 31, 2019 2:47 am

gaddyslapper007 wrote:
Wed Jan 30, 2019 10:32 pm
I first looked into bitcoin in 2011ish.....scam was my conclusion.
...
When I finally took the time and really learned about bitcoin (2013ish).. it seemed like the final piece in the PP puzzle....
VP puzzle, you mean.
traveling...
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Thu Jan 31, 2019 7:54 am

Saw this posted in the BH forum.

STUDENT TURNS $5K INTO $800K TRADING CRYPTO, BUT NOW OWES $400K IN TAXES

https://bitcoinist.com/student-400k-cry ... ncy-taxes/

(Nov 2018)
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Kriegsspiel » Thu Jan 31, 2019 8:19 am

dualstow wrote:
Thu Jan 31, 2019 7:54 am
Saw this posted in the BH forum.

STUDENT TURNS $5K INTO $800K TRADING CRYPTO, BUT NOW OWES $400K IN TAXES

https://bitcoinist.com/student-400k-cry ... ncy-taxes/

(Nov 2018)
Well, at first I thought "turning $5k into $400k isn't too shabby either."

But reading the article, his crypto is now only worth $125k. Hard ouch.
"You haven't, I suppose, ever mixed with politicians at close quarters. They're awful. I think some of these must have been the dregs anyhow, but I've discovered, what previously I didn't believe possible, that politicians behave in private life and say exactly the same things as they do in public. Their stupidity is inhuman.
- John Maynard Keynes
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Thu Jan 31, 2019 8:21 am

Or at least, that’s what it was worth at the time it was published. Maybe now it’s $125 million. Or $125.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by gaddyslapper007 » Thu Jan 31, 2019 8:57 am

dualstow wrote:
Thu Jan 31, 2019 2:47 am

VP puzzle, you mean.
yes....I certainly don't recommend it stand along side Bonds, Gold, Stocks and Cash equally. I encourage learning about it, buy enough that you can afford to lose....use it where accepted, send / receive to friends to settle small debts / credits. (Peer to Peer)…..and hopefully enjoy long term appreciation with use and adoption.


If bitcoin ever to gets to gold parity market cap (~$7trillion I believe)….then I would say it would most definitely deserve a spot equally divided in the standard PP. It is nice function of cash & gold, yet fully independent with no correlation of them both.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by dualstow » Thu Jan 31, 2019 9:56 am

I won’t be buying it myself, but I am still very interested in blockchain. I am curious to see how bitcoin and other crypto currencies fare in the coming decade.

As for small debts, my friends and I use Apple Pay Cash. Love it.
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Re: Bitcoin investors are running from the crypto to invest in gold

Post by Ad Orientem » Thu Jan 31, 2019 10:52 am

dualstow wrote:
Thu Jan 31, 2019 9:56 am
I won’t be buying it myself, but I am still very interested in blockchain. I am curious to see how bitcoin and other crypto currencies fare in the coming decade.

As for small debts, my friends and I use Apple Pay Cash. Love it.

For small debts I just use cash. It's hard to beat for convenience.
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