Investing In The Bitcoin - Advice

[jbgc]

Hey Everyone,

I am not a bitcoin miner but I do support it and want to invest in hopes of making some extra $$$.  I've been watching the bitcoin price rise and drop over the week and I am unsure when to buy.  Before I do though, I have a few questions:

1.  Where do you see the price of the BTC by 2013?  (BTC/USD)
2.  Is it stable enough now or could the bitcoin system easily crash and turn into nothing?
3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?
4.  Is it going to reach $1000/btc eventually or is $15-20 (current price) pretty much the standard price now?
5.  When would you buy?  Now?  In a week?  Explain.

Any advice/help/opinion is welcome and thank you in advance!

[Babylon]

Hey Everyone,

I am not a bitcoin miner but I do support it and want to invest in hopes of making some extra $$$.  I've been watching the bitcoin price rise and drop over the week and I am unsure when to buy.  Before I do though, I have a few questions:

1.  Where do you see the price of the BTC by 2013?  (BTC/USD)
2.  Is it stable enough now or could the bitcoin system easily crash and turn into nothing?
3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?
4.  Is it going to reach $1000/btc eventually or is $15-20 (current price) pretty much the standard price now?
5.  When would you buy?  Now?  In a week?  Explain.

Any advice/help/opinion is welcome and thank you in advance!

1. 1BTC/$100
2.  I doubt it will crash, but it is possible
3.  If that $10,000 were gambling money yes,  it's a high risk high return investment currently
4. It shot up in price a whole lot just recently, I wouldn't expect any stability for a while yet.
5.  Now, I'd suggest dollar cost averaging, buy a certain amount in dollars each week, that's the safest strategy for a commodity that fluctuates but increases in the long term, which is the behavior bitcoin usually has.

[hugolp]

http://forum.bitcoin.org/index.php?topic=19144.msg241480#msg241480

[bitbot]

I would not recommend that you invest any money into bitcoin for the sole purpose of profiting from it.
if you do want to "invest" I would say that you just set it and forget it

[Electrongolf]

I would not recommend that you invest any money into bitcoin for the sole purpose of profiting from it.

I agree with this. The price of Bitcoin won't start to rise in any predictable way until there is some kind of market to support it.

[hello_good_sir]

I believe that bitcoin will eventually be worth a lot.  However the key word is "eventually".  If you are hoping to make money any time soon you are just as likely to lose your money.

[killer2021]

1.  Where do you see the price of the BTC by 2013?  (BTC/USD)
2.  Is it stable enough now or could the bitcoin system easily crash and turn into nothing?
3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?
4.  Is it going to reach $1000/btc eventually or is $15-20 (current price) pretty much the standard price now?
5.  When would you buy?  Now?  In a week?  Explain.

1. Highly variable. Really depends on how many people use it. If lots of people jump on board then it can go through the roof. by 2013 I could see 200-300$/btc. However, if we get the facebook effect (widespread mass adoption) then it could easily go over 1,000$/btc. At 6.5 million btc in existance and 1k/btc then the total valuation is only $6.5 billion. Theres 14 TRILLION usd in circulation. Plus BTC has the potential to be the first widespread used global currency. So you can also include the value of all the other fiat currencies as well.
2. Highly volatile, however I think we will see higher highs and higher lows going forward.
3. Yes, I'd invest it but don't invest anything you can't lose.
4. See answer to number 1. If lots of people adopt it, it'll go through the roof. If not, it will fall. Thats why lots of people want to use btc for commerce.
5. I'd buy now, but thats just me.

[drapetomaniac]

1. Highly variable. Really depends on how many people use it. If lots of people jump on board then it can go through the roof. by 2013 I could see 200-300$/btc. However, if we get the facebook effect (widespread mass adoption) then it could easily go over 1,000$/btc. At 6.5 million btc in existance and 1k/btc then the total valuation is only $6.5 billion. Theres 14 TRILLION usd in circulation. Plus BTC has the potential to be the first widespread used global currency. So you can also include the value of all the other fiat currencies as well.

14 trillion in circulation is what causes the value of these notes to plummet.  Along with the 70 trillion in debt our dollar has acquired really puts the nail in the coffin for the USD.
Something is only valuable when it is tough to obtain and there is enough market demand for it.  Bitcoins are ingenious because you can just divide them up, rather than printing out more.

If I have one apple I can sell that apple to a hungry man for a dime and be happy.
But if I have one apple and there are 5 hungry men begging me for it, the value of that apple just increased exponentially.
The same thing will happen with bitcoin, while the opposite happened with the dollar.

[SmokeAndMirrors]

If I have one apple I can sell that apple to a hungry man for a dime and be happy.
But if I have one apple and there are 5 hungry men begging me for it, the value of that apple just increased exponentially.
The same thing will happen with bitcoin, while the opposite happened with the dollar.

What I would do is sit on that apple and wait for more hungry men. Once there are about 100 hungry men, I would eat the apple.

 I would just buy. If you have no faith in bitcoins, buy a few anyway then go back to your life before bitcoins. Come back in a few years and you may have made a few thousand dollars. Worst case, you lose a few bucks.

[ploum]

3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?

I would bet on the success of bitcoin in the long term without betting on its future value. How? Simply by investing in a business that accept bitcoins or by creating a new business based on bitcoins or anything similar.

[ktomi]

Oh, sensible people in this thread...

I am just the average Joe, a wannabe geek who thinks Bitcoin is cool and who has some spare money. Take my words with a pinch of salt, these are just my personal opinion.

1. Right now it's pretty much a guess game, there are just too much uncertainties. If it gains traction it can easily be multiples of today's price, even 10x-1000x or who knows, or it may completely crash and disappear.

2. I think this is possible and at any point it can crash and turn into nothing.

3. I personally invested about 10% of my savings into it. At the moment I wouldn't feel comfortable with putting any more money.

4. I don't know what it's going to reach, but I think 15$-20$ is a realistic price for it now.

5. I would (and I did) buy now. Depending on how keen you are to get on board, anywhere between 10$ and 20$ is OK if you think in a 1-2+ years term.

In my opinion it won't revolutionize the current financial system and won't make ordinary money disappear, however it is a healthy and viable alternative currency.

At the moment it's considered to be a rather 'dark side' tool thanks to it's anonymous and unregulated nature. This is not necessarily a problem as there are enough possibilities in the grey and black markets, however it can prevent it from becoming truly mainstream. It's still a question to how and in what direction this perception will evolve or change.

It's robust by design, but this is a people science. These are self generating processes. More adoption leads to more adoption. Or if the government makes it outright outlaw, things can turn into a downward spiral easily. Or it can induce even higher demand? Who knows, difficult to guess.

[jbgc]

Would now be a good time to buy considering that the price has almost cut in half or will it go lower?

[killer2021]

1. Highly variable. Really depends on how many people use it. If lots of people jump on board then it can go through the roof. by 2013 I could see 200-300$/btc. However, if we get the facebook effect (widespread mass adoption) then it could easily go over 1,000$/btc. At 6.5 million btc in existance and 1k/btc then the total valuation is only $6.5 billion. Theres 14 TRILLION usd in circulation. Plus BTC has the potential to be the first widespread used global currency. So you can also include the value of all the other fiat currencies as well.

14 trillion in circulation is what causes the value of these notes to plummet.  Along with the 70 trillion in debt our dollar has acquired really puts the nail in the coffin for the USD.
Something is only valuable when it is tough to obtain and there is enough market demand for it.  Bitcoins are ingenious because you can just divide them up, rather than printing out more.

If I have one apple I can sell that apple to a hungry man for a dime and be happy.
But if I have one apple and there are 5 hungry men begging me for it, the value of that apple just increased exponentially.
The same thing will happen with bitcoin, while the opposite happened with the dollar.

What I was referring to was what the value of bitcoin would do if people started dumping their dollars for bitcoins. Lets do the math here:  14,000,000,000,000 (14 trillion) / 7,000,000. That equals $2,000,000 for every 1 bitcoin. How about if we have a little less than 21 million bitcoins then what is the value? Then it would be $666,666/bitcoin

To say the least bitcoins at 15-20$ each is rather cheap if you ask me.

I'd put a couple grand into bitcoins for fun and just set it and forget it.

[killer2021]

Would now be a good time to buy considering that the price has almost cut in half or will it go lower?

Yes now would be a good time to buy, even with the volatility. Buy the bitcoins for the long term, 3-5 years.

Also what do you want to do? wait until it goes higher before you buy? You want to buy while its cheap. Bitcoins are only cheap when there is fear in the market and trust me, now is a once in a life time opportunity especially with all the hack attacks. Lots of fear in the markets so it will force people to dump their btc IN THE SHORT TERM.

Remember, btc as a currency is still fundamentally sound. The btc hasn't been breached at all. The only thing that has been breached are a couple insecure websites. Those websites are important to btc in the short term only. There are a bunch of exchanges that are opening up. So in the future if one website is breached it will be no big deal because there will be 10 others to use.

Remember this. The best time to invest are when there is blood in the streets. The best time to sell is when there is gold in the streets.

What this means is simply: buy when there is fear in the market and prices are low. Sell when prices are high and optism is high.

Now is the buying opportunity of a lifetime. You don't want to pass it up.

[minor_miner]

But always remember the most important principle: Don't gamble with money you can't afford to lose!

(at the moment, buying Bitcoins is not investing, it's speculating - and that's more gambling than anything else)

[memvola]

3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?

I would bet on the success of bitcoin in the long term without betting on its future value. How? Simply by investing in a business that accept bitcoins or by creating a new business based on bitcoins or anything similar.

Good advice.

It's funny how, in a matter of months, Bitcoin turned from "how can we put this to use" to "I want to make $$$ off of it". Absolutely nothing wrong with the latter, but still...

The appeal of Bitcoin to me, is that you have a chance to help make it successful. It's not a blind bet, it's something you can work towards, earn and be proud of. The current success of Bitcoin is the work of the people who nurtured it and built around it when it was still a baby. It's hard to identify from an external viewpoint though. As an example, I suggest following Namecoin as a younger sibling, which, although having a lot of advantages by walking on a path that has been walked before, still has to go through the same route. Yes, there are lots of miners, speculators and whatnot, but its success solely depends on people who build an infrastructure and people who put it to use. The core idea of it all, is that rational investors have an incentive to build that structure.

By investing in a business that accepts Bitcoin, or investing your time to make bitcoins, you are not only investing it on its success, but helping it succeed at the same time.

[MikesMechanix]

1. Somewhere between $1 and $100
2. I expect Bitcoin price to get more stable over time. I think the possibility of a complete crash is close to 0.
3. Yes. If I had $10k to spare, I'd invest at least $500 in a heartbeat. I'd never invest all of it in just any one thing, though.
4. I think we will be seeing prices between $10 and $20 for a while.
5. Once mtgox opens, I expect there to be a short term dip in prices, which is when I'd buy my first $500 worth of coins, in small batches (hopefully getting a pretty good average along the bottom of the curve), and then take it from there.

[Andrew Vorobyov]

3.  If you personally had $10,000+ to spare, would you invest it in bitcoins?

I would bet on the success of bitcoin in the long term without betting on its future value. How? Simply by investing in a business that accept bitcoins or by creating a new business based on bitcoins or anything similar.

The best answer

[bitcoin.monger]

Since bitcoins are deflationary in nature, the price should keep going up as difficulty and adoption increase.
However... the legal status of bitcoins is uncertain, and if you want to run a business on bitcoins you should know that $1000/day is your limit.
If these two aspects were solved, I guess one can expect A LOT of growth...

Also, if bitcoins can be made truly anonymous, wait to see what happens to the price when the underground guys start to use it on a large scale 

[FooDSt4mP]

Since bitcoins are deflationary in nature, the price should keep going up as difficulty and adoption increase.
However... the legal status of bitcoins is uncertain, and if you want to run a business on bitcoins you should know that $1000/day is your limit.
If these two aspects were solved, I guess one can expect A LOT of growth...

Also, if bitcoins can be made truly anonymous, wait to see what happens to the price when the underground guys start to use it on a large scale 

$1000 per day per exchange.  And most will allow you to raise that limit by providing a little personal information (similar to what is needed for a US bank account).  Investing in inventory to sell for bitcoins really is the best way to invest in bitcoins.  We need more vendors.  We've acquired plenty of new speculators in the past few months.  We need the economy behind bitcoin to catch up before we can handle another major growth spurt.