Topic: Investing into alts with higher inflation, velocity and less hashpower+security? (Read 374 times)

With the way that the price is rising right now I would just stick with bitcoin. You are way better off hoping that the price will continue to rise than trying to mine a coin that might not end up being successful. But then again it could rise like bitcoin did in the early days and you would have lots of money so it is sort of a tough decision. I am sticking with BTC for my part.

 - replace profit  -> volatility   yes!

everyone in cryptocurrency world knows that altcoins are where the big profit lies. but only a few have figured it out that the profit is only short term not long.

these altcoins have always been small time and controlled 100% by the whales and pumpers to generate massive amounts of profit for some and a huge amount of loss for the masses.

and the hashpower, security, or even having a virus in their wallet executable file does not matter at all. people are only trading these on exchange platforms to make money. and it makes perfect sense when you factor in the greediness and gullibility.

Speaking of ripple many have been mourning and posting sad comments on facebook as to how they lost a huge amount after ripples value went down. But anyway not all atcoins are that bad what we need really is the timing and luck so if we do some trading we can get a huge profit from those altcoins. But compared to bitcoin altcoins have a big probability of price meltdown compared to bitcoins.

My idea is that crypto is in a bubble since 2009, because that's what bitcoin and the rest of crypto were designed for: assets that are easy to come by in the beginning, and then, get scarce when more people know about it.
I don't know of any instant in time (well, a part from the very first bitcoin years maybe) when the bitcoin price reflected the demand for coins to buy stuff with (that is, as a currency).  I think that bitcoin and the rest of crypto has always been price-determined by:

1) buying/mining/holding coins because they might gain in value, to sell them higher than what we put in it in the long term
2) trading, that is, try to buy them somewhat lower, and sell them somewhat higher in the short term

That doesn't mean that bitcoin in particular has not been used also as a means of payment (especially in dark markets), but I think that the demand for coins "in order to buy stuff with" has rarely been the price setter.

As such, technical parameters rarely matter, and adoption as a currency is rather contra-productive to high speculative value (the more it is circulated as a currency, the higher its velocity, and the lower its price will be).  The price you see has not much to do with, nor, the block chain technology, nor the real world usage (contract, currency, ...) but is the price of an abstract speculative token on exchanges (mainly poloniex).

You can easily see this when coins rise a manifold in price, and their transaction volume on chain remains essentially constant (and sometimes small).  Price setting has nothing to do with what happens on the block chain.

But this is even true for bitcoin.  Given that the blocks are full, essentially, its adoption cannot rise (it cannot be used more as a currency) ; but nevertheless, the price rose by a factor of more than 2 in less than half a year.  When you do a quick estimation, though, you see that bitcoin's market cap has always been a large multitude of the market cap it would have been if its demand were that of a currency.  So bitcoin too, has a price that is entirely disconnected from its block chain happenings or usage, and I claim that this has even always been the case.

Does not really make sense to me - any ideas where I might be wrong ?

If not - we might see a big dot-com like bubble burst soon ....

Sorry for warning and ripple your nipple as long as you can.