What I think is that your comprehension of the subject matter is holistically weak. And as for your throwaway insult of calling people that base their views on fact and not hype “boomers,” listening to it is like hearing a tiny dog jumping up and down behind a chain link fence that is incessantly barking. Everyone can agree that it can safely be ignored.
lol, okay Boomer!
I’d respect your opinion a lot more if you put $$ behind it vs spouting off. But hey, you do you.
Crypto worth more than $3 Trillion – a lot of rich fools out there, huh? Just don’t call it an asset class – you’ll distract @destroyer from clipping his Standard Oil and AT&T bond coupons to mail in for his end of year interest payments. 
Interesting watching Marlowe and DoW go at it and seeing the typical responses of both sides.
I’m definitely more in the DoW camp. Think +99% of crypto has very little-to-no utility (as echoed by many crypto KOLs) beyond speculation and regulatory arbitrage that amounts to a global MLM scheme hyping “the future” with heavy and misguided undertones of a gold-bug 2.0 utopian dream. The space is rampant with market manipulation, ignorance, extreme leverage (just cannot see it with a normal lens), fraud, scams, and blatant lies. Moreover, from what I’ve researched, the underlying tech doesn’t scale well or materially outperform existing tech (except for maybe niche applications for append-only databases). This is why you see a lot of L2 “fixes” that essentially re-centralize a decentralized platform or gimmicky applications (e.g. NFTs). It’s just recreating existing finance / other platforms, but with extra steps (completely unnecessary).
I also find most crypto arguments riddled with circular reasoning, warped logic, and/or devolve to superficial shaming / name-calling vs. have an objective discussion. "It’s the future, NGMI, HFSP, no-coiner, OK boomer, FUD, few understand, you haven’t done enough research (i.e. code for → keep researching until you see how great crypto is!), the market-cap is at ATHs! (never mind market cap makes no sense for crypto), etc…" It’s almost like arguing against a religion (which I believe that is what it has turned into).
That said, there are a significant amount of financial and human capital moving into the space. At best, I see it as actively traded hyper-VC with maybe some real lasting application emerge. At worst, the majority buys into the hype and it becomes politically impossible to shut down and we regress as a society (e.g. hyper-deflation → see hyper-bitcoinization). My bet is that it goes to 0 as there is essentially no intrinsic value (almost entirely extrinsic). However, no idea what breaks it (bad and fake positive news comes out all the time, but it all seems to be “this is good for BTC”) and so it will probably keep going up for some time. I don’t think a collapse of crypto is “systemic” like banks were in '08. However, I do think there would be a lot of public outcry as many would see their sizeable paper gains evaporate (triggering defaults elsewhere) while the maxis would cry their dream has been taken away by the evil central bankers. In other words, the systemic risk might be in a different form and force politicians to temporarily prop crypto up…
As such, I’ve come around to the idea putting in ~1% as a hedge (aka a lottery ticket or a life-safer in the new Michael Saylor Moon insanity world). Where I see more interest on the traditional institutional side is VC and crypto stocks vs. the actual tokens (still very illiquid, though some are making 10-100bps allocations there).
Lastly, think effectively shorting crypto is very hard to do. Illiquid, highly opaque, and tons of manipulation that make the risks far too great.
Interesting post, and I think a lot of folks in the finance industry in particular have a pretty similar viewpoint as you are expressing here.
I would differentiate rational optimists from fanboys, very similar to how most Tesla shareholders are optimistic about Tesla vs a small hard core are Elon Musk fanboys. A lot of crypto naysayers conflate those two.
Time will tell if crypto continues to build, tails off or becomes an Enron or Worldcom. Bitcoin in particular has a lot of risks, not least of which is from ESG investors and greens who don’t like the energy usage of mining. Bitcoin cannot be killed but it could certainly be hampered if OECD countries banded together to regulate it. At this point, though, I am viewing that as decreasingly likely because BTC is becoming increasingly popular among “normies” and therefore has a political constituency. A lot of former skeptics are putting “some” amount of $$ into crypto as you are considering to do. The custody issue is becoming more mainstream vs intimidating & risky, and when/if ETFs are approved in the US that will only hasten adoption.
One area where I must correct you is that shorting crypto is easy. You can access futures trading for the more popular coins such as BTC and ETH on mainstream platforms like Trade Station.
LOLOLOLOLOLOLOLOL
@Marlowe - come back to us when the bond market collapses. What do you do in this industry if you don’t mind me asking? Do you have investors/clients? Do they know your position on bitcoin as a “long term investment”, curious, because I’d love to poach those assets from you!!
For ■■■■■ sake dude.
You understand that those periodical tables of returns allow us to tell clients that they can expect a 7%'ish CAGR over a full market cycle right? This is what our entire industry is based on. I wonder how we’re going to get to 7% on average this decade if the first two years of market action brought 30% each…
DoW is so ■■■■■■■ right on this ■■■■ it’s not even funny.
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This is just the sort of sneering attitude I was reacting to when I first came across this thread. You come across as unhinged and certainly not rational. Reasonable people can disagree but you clearly have an axe to grind and aren’t applying an unbiased lens to the subject.
I don’t owe you any information about myself or my profession, so run along and mind your own business, Mr. Angry.
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I’m not angry, I’d say all of that right to your face in person too, I just personally swear a lot. However, if you actually believe in bitcoin being a good long term investment, then yes, I want you to know right to your face that I think you’re an imbecile, and may the worlds tiniest of violins be playing over your career gravestone when the record is finally set straight.
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Again, I won’t share any details of my profession with you because it’s none of your business, but I will be happy to shed some light on my own portfolio.
A little over 4 years ago I made a bet with 3% of my portfolio and put it all into BTC at about $1700/BTC. Since then the ‘other’ 97% of my portfolio has out-performed both the S&P 500 and Mr. “Rat Poison Squared” Warren Buffet, every year, due to me being over-weighted in tech stocks and having done pretty well in stock-picking such as Okta, ServiceNow, and Tesla.
Despite those healthy returns on that 97% and combined with all of my personal savings I’ve done in the interim, darned if that “little engine that could” 3% crypto has ballooned to about 20% of my portfolio. About 80% of that is BTC and 20% is other coins I’ve bought with my savings, with BNB doing particularly well over the last couple of years.
And I’m going to let it run. I personally think in 10 years BTC will be $1M, but even if it flat-lines or goes to $0 (which it won’t), I’ll be fine since the other part of my portfolio has done pretty well in its own right.
So feel free to call me an imbecile, but I saw crypto as a once-in-a-lifetime opportunity that I took a small but big-enough bet on, and so far it’s paid off pretty well and I’m going to let it run because I have enough outside of crypto that I don’t feel the need to hedge.
Maybe you’ve never taken a big bet on your career or your investments before and as a result you are bitter to see other people you consider to be less intelligent doing so much better than you are and it’s a blow to your ego. I get it, but I would suggest that you try to let go of some of your anger because it’s not healthy for you and isn’t going to improve your lot in life.
The people that don’t make very much in total comp in their day jobs are always bragging about their personal portfolios.
Never met a patagonia that didn’t love talking about his day job either!
This one of them, “double whammy’s” they speak of.
Honestly, I own some bitcoin and ETH. BTC is simply a new store of value. Not a currency. Saying converting it to USD invalidates it is like saying selling gold (or any store of value) to USD invalidates the asset. If 08 taught me anything, it is that stores of value become increasingly important when there is monetary uncertainty.
Hey, that’s fair. You need to play your strengths.
Not the same comparison though. Gold is not a fiat currency. It is an asset. Bitcoin is not an asset, as commonly defined. What is Bitcoin? It’s not really used as a currency. >1% of average daily volume is actually used to facilitate the purchase of goods and services. So why does it exist? What does it do? The circular argument that, well, others are piling into it, making money, so it must therefore have credibility is hard to get behind intellectually. Somebody tell me why this is not in essence a lottery or a raffle (or worse, a de facto, spontaneously generated pyramid scheme that gained momentum due to severe network effects).
This post made for an amusing lunch break, cheers gents.
@Destroyer_of_Worlds Best trade, long the environment short bitcoin
I’m on board with this trade ha ha…
imo someone who invests in crypto, tesla, or amazon are speculators. i mean taking out the last five years it was hard to imagine that these companies could possibly mint cash flow. if you are bound to speculate into those, then you are very likely to gamble in other things. they prolly like to gamble in general, buy lottery tickets, open up pokemon cards, buy art, trade stocks, forex, and commodities. lol
anyways me personally, i like to things that add value and extract cash from people’s lives at a decent multiple. though i like to see future growth potential, i dont like to depend on it. i want a good long history of earnings and to own it for life. because the last thing i want to do is worry about selling something because it no longer adds value.
It’s cute that you think salaries and day jobs are the best way to develop wealth. You keep chasing that dime, my guy. 
I think someone’s age should dictate their growth allocation more so than the market cycle. Even at this stage of the market cycle there’s some growth names that are worth holding and even buying into ahead and during a bear market if you have ten years.
What’s even cuter is that I’m doing it. You know, at some point, your variable and long term comp swell to the point where, for most executives, this IS how wealth is principally created. Not day trading. But I smell that this world is foreign to you. In the absence of other opportunities that you may be denied, definitely keep doing what you’re doing. In fact, I think an even more muscular allocation to crypto makes complete sense. You go, buddy!