What?? Bears infesting my thread? 
The correct way to value BTC is to take a scenario analysis:
- What is the value per unit if A) it fulfills its promise?
- What is the value if B) it does not?
- What is the probability of A)?
- How long does it take?
- What is the current price?
A: value $1,000,000
B: value <$100,000
A: probability 20%
A: duration at least 3 years, up to 10 years
current: $500.
It seems to me that (with the caveat that better investments such as Monero may be available) I should invest everything that I can afford to lose.
Kelly formula: With essentially infinite payoff, invest same % as is the probability of success = 20%. (Kelly is valid if B automatically leads to loss of entire investment, and is higher if this is not the case.)
My suggestion: 50% of investment capital in crypto, of which the %-age of Monero should approach 50% if the sum is very small but be much less if the sum is significant.
The correct way to value BTC is to take a scenario analysis:
- What is the value per unit if A) it fulfills its promise?
- What is the value if B) it does not?
- What is the probability of A)?
- How long does it take?
- What is the current price?
A: value $1,000,000
B: value <$100,000
A: probability 20%
A: duration at least 3 years, up to 10 years
current: $500.
It seems to me that (with the caveat that better investments such as Monero may be available) I should invest everything that I can afford to lose.
Kelly formula: With essentially infinite payoff, invest same % as is the probability of success = 20%. (Kelly is valid if B automatically leads to loss of entire investment, and is higher if this is not the case.)
My suggestion: 50% of investment capital in crypto, of which the %-age of Monero should approach 50% if the sum is very small but be much less if the sum is significant.
Very interesting...I invested a significant sum in crypto+miners, so my percentage of active capital (not counting real estate equity) in crypto is ~20% .
I don't think that I will "actively" up it up to 50% (if it goes there by appreciation-fine)
Monero-invested (exchanged) 2% of my BTC into XMR.