Quote from: miscreanity on May 15, 2017, 07:10:09 AM

Quote from: tabnloz on May 15, 2017, 06:11:05 AM

MA's latest is on Bitcoin, where he likens the volatility of btc to the crash in mutual funds in the 60's (ie, funds dropped by 80% when the Dow dropped by 25%). He just sees it as an asset with high volatility and not a currency or store of value. But he also says that after the crash, the tech may be the future.

There will undoubtedly be more rises and falls but overall the cryptocurrency field is an entire ecosystem with myriad uses in so many other industries that looking at it as simply an asset class misses the big picture. The bitcoin unit is only part of the whole; without a thorough understanding of the system it can be difficult to assess it holistically. I think Armstrong may have stopped at a mostly superficial comprehension.

Since Armstrong first started posting about Bitcoin, he seems to have changed his stance. It has been suspected that there wasn't enough data for Socrates to develop a high-confidence forecast. Whether that has changes, who knows?

One thing to note is that Armstrong is calling for the DOW to rise significantly. If anything, crypto would be aligned with private assets and therefore rise along with equities in the near-term.

Additionally, Bitcoin is a politician's wet dream: tracking and control with a keystroke. It appeals to all parties but will eventually trap users.

Yeah, his initial stance seemed to be that government is too powerful and will destroy it when necessary. Now, he seems to think the tech is worthwhile.

But I think there might be a few flaws to his latest post

- BTC is unlike Mutual Funds as it is not an easily obtainable, retail asset

- BTC faces a negative media led narrative

- The volatility of Bitcoin may be a red herring when taken on a risk adjusted return basis (ie the volatility to the downside is dwarfed by returns on price to the upside)

- BTC operates independent of governments, central banks

Looking at 2 scenarios, how will BTC react:

1) Massive economic shock / recession / stock market downturn

Would Bitcoin also see a large selloff as the old 'sell what you can, not what you want' meme is lived out?

Are enough people invested in BTC also heavily invested in the stock market, where a stock margin call would lead to a large dumping of BTC?

Would an initial dip be followed by a massive rise in this case (ala gold in 2008)

Would BTC be seen as a safe haven asset and see a tremendous inflow in during this kind of event? (seems possible based on Brexit, Trump).

2) Crack up boom. Dow hits 40,000 etc

Will this see Bitcoin also rise, as in all boats get floated?

Does BTC see its relevance wane, as the good times are here again?