Bitcoin Investment: Good Debts vs Bad Debts

Altryist

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Quote from: barisbilgili on November 22, 2023, 11:20:26 PM

When we have made the decision to take out debt to be able to meet what we need, of course we are obliged to pay it off, for some people who run businesses they have to take out loans from banks for capital in the business they have run and also as a motivation for them to work working hard to make the business run well so that they can pay off the loans they have taken from the bank.

It would be better before we decide to take a loan from the bank, we must first assess ourselves whether we will be able to pay it off and if we think we will be able to pay it then we can take it, don't let it happen that after we take the loan we can't pay it off of course. This will get us into a problem that we should be able to avoid.

Buying Bitcoin with credit money is a game of luck, those who did it at the beginning of the year will definitely benefit from it, but if you take out a loan to buy Bitcoin now, then everything may be different.

Due to the high volatility, it is very difficult to calculate how advisable it might be to buy Bitcoin with credit money, because you can buy now for 37k and tomorrow you can see the price of 30k or 25k, which will bring losses, since you will need to make monthly loan payments.

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Quote from: speeder on November 22, 2023, 04:30:57 PM

Good debt or bad debt, I don't like either. Debt is not a very good thing. Debt degrades human nature. Although the borrowed money seems to be own money for some time, later the borrowed money has to be paid back on time. There are some bad loans that incur penalties if not repaid on time. It is not always possible to get success by using borrowed money, if the borrowed money fails to be used properly, the borrower must face losses. If you decide to invest or do business with borrowed money. I think, it is a wrong decision because there are risks in both investment or business. So I will never risk investing or trading with borrowed money.

I also have a mindset where I am feeling allergic when it comes to debts. I am feeling better and at peace when I have no debts.

But those rich people and companies are actually taking loans in order to establish more business. Of course, there are loan interests and penalties when loan payment dates aren't followed, otherwise, borrowers can abuse the system.

Borrowing money in order to trade is always a no/no to me and to most people here as I observed. Borrowing money is only at best when used in a business. Of course, before considering a loan, there should already be a business plan in order to have a higher chance of success.

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Quote from: Essential10 on November 22, 2023, 11:57:41 AM

I think there is no such thing as good debt or bad debt, debt is debt. My father had taken some loan from the bank for house repair work. Later on he had to get a lot of speed to repay the loan. My father had to repay the loan to the bank with a fixed profit every month from his monthly income. I still remember that time, my family went through many crises due to this loan. So I think debt is never good. It is wise to be cautious about taking out a loan for any other business or Bitcoin investment. Debt can have a negative impact on financial stability and future opportunities. Risks and potential consequences should be carefully considered before taking any type of loan. Although some individuals may be successful using loans for financial management or investment, it is important that not all situations are the same and careful consideration should be given to taking out loans.

When we have made the decision to take out debt to be able to meet what we need, of course we are obliged to pay it off, for some people who run businesses they have to take out loans from banks for capital in the business they have run and also as a motivation for them to work working hard to make the business run well so that they can pay off the loans they have taken from the bank.

It would be better before we decide to take a loan from the bank, we must first assess ourselves whether we will be able to pay it off and if we think we will be able to pay it then we can take it, don't let it happen that after we take the loan we can't pay it off of course. This will get us into a problem that we should be able to avoid.

CryptSafe

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Quote from: alastantiger on March 30, 2023, 04:10:42 AM

There are bad debts and there are good debts. Bad debts- loaning money to buy a car that won't be used for business ( Uber, Bolt). Loaning money to buy a pair of shoes, clothes, a piece of furniture etc.

Good debts - loaning money to purchase something that would appreciate in value over time. Real estate, precious metals, commodities etc.

They say poor people have bad debts and rich people have good debts.

One of the popular pieces of advice you'd hear in the Bitcoin space is to never borrow to invest in it.

Despite the volatility, our hope is that Bitcoin will appreciate in value.

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

OP, as far as I know, a debt is a debt, and it would still be whether it is a good debt or a bad debt. As you have said, a loan that does not generate income to me seems like a waste of resources because it is expected that debts are to be serviced, and this means that such a loan must have been able to generate many returns so as to service it properly.You talked about bitcoin and why you should not get a loan to invest in it. I believe you should have had knowledge of the volatility of bitcoin and as such, one is not advised to get a loan for bitcoin investment and also should know that investing in bitcoin with loan is highly risky and not advisable to do because the bitcoin market has no control and can swing to any direction at any time.

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Good debt or bad debt, I don't like either. Debt is not a very good thing. Debt degrades human nature. Although the borrowed money seems to be own money for some time, later the borrowed money has to be paid back on time. There are some bad loans that incur penalties if not repaid on time. It is not always possible to get success by using borrowed money, if the borrowed money fails to be used properly, the borrower must face losses. If you decide to invest or do business with borrowed money. I think, it is a wrong decision because there are risks in both investment or business. So I will never risk investing or trading with borrowed money.

Essential10

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I think there is no such thing as good debt or bad debt, debt is debt. My father had taken some loan from the bank for house repair work. Later on he had to get a lot of speed to repay the loan. My father had to repay the loan to the bank with a fixed profit every month from his monthly income. I still remember that time, my family went through many crises due to this loan. So I think debt is never good. It is wise to be cautious about taking out a loan for any other business or Bitcoin investment. Debt can have a negative impact on financial stability and future opportunities. Risks and potential consequences should be carefully considered before taking any type of loan. Although some individuals may be successful using loans for financial management or investment, it is important that not all situations are the same and careful consideration should be given to taking out loans.

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Quote from: Fivestar4everMVP on November 18, 2023, 06:22:50 AM

Well, I personally do not advice people to borrow money to invest in bitcoin, most especially if the borrower will depend on bitcoin's price appreciation to be able to settle the loan.

If the borrower has a business, or is working and earning money through which he or she can settle the borrowed money without touching the money he or she invested in bitcoin, then borrowing I did consider as good dept.

Even though I still believe that borrowing to invest in bitcoin generally is a good dept, I personally still believe that, taking a loan to invest in bitcoin without a plan B means of paying back the money is not ideal and not advisable.

borrowing money for the sake of investing defeats the essence of investing in itself, only someone is brave enough to take on the risk and speculate, their profit would just eaten by interests.
moreover the essence of hodling was keep bagging bitcoin until opportunity arise doesn't matter how bad the market might get but with borrowed money is that even possible?
after all there's money need to be paid every month added with the interests I don't think its even a good idea at all.
People should know that investing in bitcoin isn't some short term investment where you gonna make half of your initial capital as profit in the next week sometime it requires months if not year before someone might have meaningful profit for holding even more realistically so when the market is in bearish.

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Well, I personally do not advice people to borrow money to invest in bitcoin, most especially if the borrower will depend on bitcoin's price appreciation to be able to settle the loan.

If the borrower has a business, or is working and earning money through which he or she can settle the borrowed money without touching the money he or she invested in bitcoin, then borrowing I did consider as good dept.

Even though I still believe that borrowing to invest in bitcoin generally is a good dept, I personally still believe that, taking a loan to invest in bitcoin without a plan B means of paying back the money is not ideal and not advisable.

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Quote from: Cryptmuster on October 22, 2023, 03:25:46 AM

Quote from: alastantiger on March 30, 2023, 04:10:42 AM

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

I would classify this debt as too risky, because in the case of Bitcoin it is difficult to calculate exactly the time when we will be able to profit from our investment. A bear market can be very long and all this time we will need to repay the loan, and if you find yourself in such a protracted period, then such an investment will not bring you anything, in addition, and you will owe even more than you borrowed.

Yes ,you are right . For Bitcoin debt is very dangerous for person who is employee or self employee. It will be financial burden on one's family because when it's price will go down , one's family will suffer . So if you have your own money , invest in Bitcoin otherwise it will kill you with your family . Because debty person has no choice , people will take money if he took money from people and if he took money from Bank ,Bank will also give burden on his head. He can suicide. Liquid will help in Bitcoin investment and you would have no burden on your head. You should invest in Bitcoin if you have some extra money and you want to invest your money and you want to double , triple and multiple your investment .There is no investment tip like Bitcoin.

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Quote from: alastantiger on March 30, 2023, 04:10:42 AM

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

I would classify this debt as too risky, because in the case of Bitcoin it is difficult to calculate exactly the time when we will be able to profit from our investment. A bear market can be very long and all this time we will need to repay the loan, and if you find yourself in such a protracted period, then such an investment will not bring you anything, in addition, and you will owe even more than you borrowed.

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Quote from: Nerdy doctor on October 21, 2023, 10:31:01 PM

Now in the hopes that Bitcoin will appreciate, it then turns out to be a good debt of one borrows money to invest in it. Some might also say playing it safe doesn't bring in any real cash. There's always a tendency for things to go south when it comes to investments regardless of where the investments are allocated. Bitcoin brings forth the possibilities of financial freedom but it also comes with a cost.

The point is that the so-called good debts should not be used for investment in the case of low and medium incomes, only in the case of your house, which Kiyosaki would not agree with, but I give my take on it.

For people of moderate or low income what works best for them is to control expenses, try to increase income, and save constantly in assets in which they can do DCA, it can be bitcoin, index funds or we can consider the mortgage of your house a DCA. As much as Kiyosaki considers it a liability, from a balance sheet point of view it is not (it takes money out of you pocket but you build equity that you can cash in later on).

Companies, for example, or people with large amounts of capital such as Michael Saylor, who has bought a large part of the bitcoins he has by issuing debt, do it for investment. But they are on a different level.

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Quote from: Nerdy doctor on October 21, 2023, 10:31:01 PM

In regards to the question "would you classify borrowing money to invest in bitcoin as good debt or bad"... I would say a little bit of both. As there are so many risks involved, let's not forget the market volatility, that is at best one of the top concerns involved while investing in bitcoin.

I think most people will definitely not forget the volatility that exists in the market because they are already very aware of the risks before investing in Bitcoin. This is still a worry for some people who invest in Bitcoin, but we also need to see investors who remain calm when they invest in Bitcoin so that they don't even seem to panic when there is a price correction in Bitcoin.

Quote

Now in the hopes that Bitcoin will appreciate, it then turns out to be a good debt of one borrows money to invest in it. Some might also say playing it safe doesn't bring in any real cash. There's always a tendency for things to go south when it comes to investments regardless of where the investments are allocated. Bitcoin brings forth the possibilities of financial freedom but it also comes with a cost.

Everything has costs and risks, so everyone cannot deny this because they must first be well understood when they want to invest. Because Bitcoin is indeed able to bring financial freedom to everyone, but people who are only looking for security will not get more real money because they may still be very afraid of taking risks. So there is no real money that they can hope for other than just the security of the assets they already own and I think that is very natural because people who earn real money are people who are able to take risks after understanding the basic concepts for any risk.

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Quote from: alastantiger on March 30, 2023, 04:10:42 AM

There are bad debts and there are good debts. Bad debts- loaning money to buy a car that won't be used for business ( Uber, Bolt). Loaning money to buy a pair of shoes, clothes, a piece of furniture etc.

Good debts - loaning money to purchase something that would appreciate in value over time. Real estate, precious metals, commodities etc.

They say poor people have bad debts and rich people have good debts.

One of the popular pieces of advice you'd hear in the Bitcoin space is to never borrow to invest in it.

Despite the volatility, our hope is that Bitcoin will appreciate in value.

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

In regards to the question "would you classify borrowing money to invest in bitcoin as good debt or bad"... I would say a little bit of both. As there are so many risks involved, let's not forget the market volatility, that is at best one of the top concerns involved while investing in bitcoin.

Now in the hopes that Bitcoin will appreciate, it then turns out to be a good debt of one borrows money to invest in it. Some might also say playing it safe doesn't bring in any real cash. There's always a tendency for things to go south when it comes to investments regardless of where the investments are allocated. Bitcoin brings forth the possibilities of financial freedom but it also comes with a cost.

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Quote from: Wend on July 02, 2023, 01:33:05 AM

It does not depend on the bank's interest rate, it all depends on your ability. If you have a job and can repay the loan even if your investment fails, an investment loan may be considered. Borrowing money for investment or business is not recommended, but if we have a plan for it and can pay off the debt, we can try because there is no success without trade-offs, I agree with your argument. But we need to know how much our ability is, don't be too greedy or too subjective, otherwise, we will have to pay dearly.

Borrowing, of course, is something that looks easy to do but can also be difficult to get, because it is likely that the bank that provides the loan will see how much ability the borrower has, whether he will be able to repay the loan or can he have greater collateral than the loan made, or already has a job. so you can pay it every month.

In my opinion, borrowing for investment and business can be done as long as the loan installments can be paid every month from the results of the work done, or later it can be returned from the results of the investment or business that has been carried out. agree with you that if you want to borrow, you have to also do a calculation of whether we can repay the loan later, keep borrowing according to what you can do, if you anticipate wrongly, you will be entangled in debt problems.

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Quote from: Synchronice on June 21, 2023, 02:35:53 AM

Quote from: alastantiger on March 30, 2023, 04:10:42 AM

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

Depends on the interest rate of your bank. If it's two digits, on the upper side (20-30-40 percent), then it doesn't worth the risk to my mind but if it's a low percent and you have a salary enough to pay your loan and you won't ruin your life doing so, then why not? He who does not risk will never drink champagne, you know.
By the way, if someone takes a loan to buy bitcoin when it reaches its ATH, I would call it a bad debt but if someone buys for example before halving or soon after halving or after the crash of its ATH, then I would call it a good debt.

It does not depend on the bank's interest rate, it all depends on your ability. If you have a job and can repay the loan even if your investment fails, an investment loan may be considered. Borrowing money for investment or business is not recommended, but if we have a plan for it and can pay off the debt, we can try because there is no success without trade-offs, I agree with your argument. But we need to know how much our ability is, don't be too greedy or too subjective, otherwise, we will have to pay dearly.

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Quote from: xSkylarx on June 27, 2023, 05:13:22 AM

Quote from: Synchronice on June 21, 2023, 02:35:53 AM

Quote from: alastantiger on March 30, 2023, 04:10:42 AM

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

Depends on the interest rate of your bank. If it's two digits, on the upper side (20-30-40 percent), then it doesn't worth the risk to my mind but if it's a low percent and you have a salary enough to pay your loan and you won't ruin your life doing so, then why not? He who does not risk will never drink champagne, you know.
By the way, if someone takes a loan to buy bitcoin when it reaches its ATH, I would call it a bad debt but if someone buys for example before halving or soon after halving or after the crash of its ATH, then I would call it a good debt.

As long as you can pay it off, then it is okay, because that is really your problem if you invested at ATH, as you haven't researched more. You are right, you can't drink a wine if you are staying in your comfort zone and just waiting for luck to come to you, and even now, most people take out loans to take a risk on their businesses. How much more on us if we know about bitcoin and have the capability to gain profit from it? But again, we only invest what we can afford to lose, as we don't know what will happen to our investment. That is why it is better that if we take out those loans, we can still pay them off even if we lose all our investment.

Your comment, while imbued with the entrepreneurial spirit of taking risks, slightly romanticizes the potential dangers of investing borrowed money into something as unpredictable as Bitcoin. The belief that 'you can't make an omelet without breaking some eggs' might work in some business scenarios, but when it comes to volatile assets like cryptocurrencies, the stakes are much higher

Just like you wouldn't bet your house on a single roll of the dice, putting all your borrowed money on Bitcoin seems to be tempting fate. Crypto markets are notorious for their volatility - today's all-time high might be tomorrow's epic crash

Furthermore, the risk of being unable to pay back the loan in the event of an investment loss could have serious financial and personal implications. A more prudent approach would be to only invest money that you can afford to lose

Altryist

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Quote from: CryptoHeadlineNews on June 21, 2023, 01:49:24 AM

I think we should say that good debts are assets while bad debts are liabilities, and Bitcoin on the other hand could be referred as a good debt, because of its potential to rise or fall in value depending on the current nature of the market, and how long the period of investment. But however, I'm not a type who will advise people to take loan so to invest in Bitcoin, because just as the interest of your loan keeps accumulating, Bitcoin is an investment nobody is sure of it's next moved, as it is been controlled by market demand & supply. And don't be surprised that the due day you were supposed to pay back your loan, Bitcoin could be 20% lower or higher in price, depending on the nature of the market at that very moment.

An asset will also not always be good debt, even if it is capable of making a profit, but this income is not enough to even cover the payments on this debt, then such an asset will definitely be just as bad. As for buying bitcoin with credit money, this is probably the worst idea that could be accepted, because I don’t know a single story when someone took a loan to buy bitcoin and didn’t lose money on it, let alone to earn something.

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Quote from: Synchronice on June 21, 2023, 02:35:53 AM

Quote from: alastantiger on March 30, 2023, 04:10:42 AM

Would you classify borrowing money to invest in Bitcoin as good debt or bad debt?

Depends on the interest rate of your bank. If it's two digits, on the upper side (20-30-40 percent), then it doesn't worth the risk to my mind but if it's a low percent and you have a salary enough to pay your loan and you won't ruin your life doing so, then why not? He who does not risk will never drink champagne, you know.
By the way, if someone takes a loan to buy bitcoin when it reaches its ATH, I would call it a bad debt but if someone buys for example before halving or soon after halving or after the crash of its ATH, then I would call it a good debt.

As long as you can pay it off, then it is okay, because that is really your problem if you invested at ATH, as you haven't researched more. You are right, you can't drink a wine if you are staying in your comfort zone and just waiting for luck to come to you, and even now, most people take out loans to take a risk on their businesses. How much more on us if we know about bitcoin and have the capability to gain profit from it? But again, we only invest what we can afford to lose, as we don't know what will happen to our investment. That is why it is better that if we take out those loans, we can still pay them off even if we lose all our investment.

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Quote from: lepbagong on June 27, 2023, 12:05:00 AM

because it takes large funds to be able to invest in bitcoin.

If you're going to buy 1 whole bitcoin then yes. But don't forget that you can buy in bits and little amounts depending on how much the minimum amount is being asked by the exchange where you're buying.

Quote from: lepbagong on June 27, 2023, 12:05:00 AM

there's nothing wrong if you want to take on debt with the aim of buying bitcoin

That's not advisable and many will agree that it's a bad idea to take a debt for buying bitcoin even if you can afford to pay. Much better to just save that money and buy later on.

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Quote from: Kadal Ijo on June 14, 2023, 02:16:56 AM

Bitcoin investment promises big profits so we have to be brave to invest, unfortunately many people don't have money to invest, the last option is of course to dare to take on debt, if we dare to take on debt now then the opportunity for profit is very large because early 2024 there will be a halving that will make we get big profit.

very promising profit and you are right about investing in bitcoin but the main obstacle is clearly the funds that must be prepared, because it takes large funds to be able to invest in bitcoin. there's nothing wrong if you want to take on debt with the aim of buying bitcoin, but you have to analyze it properly because it's not the halving period that can make bitcoin increase sharply, but still a year later there will be an achievement of ATH. so it must be remembered that the waiting period is quite long if you want to get into debt for bitcoin, so you must correctly determine when it is time to buy bitcoin because the long time situation will make the calculations must be accurate, in order to get maximum profit.

Topic: Bitcoin Investment: Good Debts vs Bad Debts (Read 1537 times)