old_engineer (OP)
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September 06, 2011, 08:42:52 AM |
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For example, a VC may invest $10 million in a company, in exchange for 10% of the stock in the company. At the time of investment, is the company worth $100 million? Not at all! But the VC hopes they'll be worth $200-$400 million in a few years, and they can double their money or more.
Shares in a new startup are usually vastly overpriced for a good reason: they need the money in order to make a business. And bitcoin exchanges and developers need money, too. Someone has to pay the lawyers in Mt. Gox's court case against the French bank later this month, and I'm glad to have contributed towards their expenses. And some early adopters are paying to develop FPGA miners, web site plug-ins, ATMs, and many other infrastructure tasks that take money and time, and I have, indirectly, contributed to their development costs, too. It's a zero sum game between the buyers, sellers, exchanges, and miners: no cash is being destroyed, it's just getting redistributed. And most importantly, none of it is going to Wall Street.
I'm holding, and will even likely buy more coins next month, at whatever the price it is then. And yes, a rant makes me feel better about having a lower face value on my held bitcoins. Having my money in the bitcoin economy instead of in a big bank feels good, even if the face value is currently less than I put in.
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The_Duke
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September 06, 2011, 08:47:23 AM |
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Yeah, only the shares are of a somalian company who will use the first half to bribe some local goverment officials and the second half to buy a small boat to go pirate some oil tankers that are headed your way. They then get shelled by a french navy ship and you never see any of your investments back.
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NOT a member of the so called ''Bitcoin Foundation''. Choose Independence!
Donate to the BitKitty Foundation instead! -> 1Fd4yLneGmxRHnPi6WCMC2hAMzaWvDePF9 <-
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old_engineer (OP)
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September 06, 2011, 09:00:18 AM |
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High risk, high reward! Funny you should mention Somalia: using bitcoin is actually one of the easier ways to send money to Somalia, and it makes it possible to attract worldwide investors to finance a honest-to-goodness pirate expedition. Given the non-functional government and lack of banks, you can't just deposit a check or mail them a few thousand USD to buy gas & supplies. Arrrr!
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Cluster2k
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September 06, 2011, 09:04:49 AM |
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High risk, high reward! Funny you should mention Somalia: using bitcoin is actually one of the easier ways to send money to Somalia
Once the bitcoin is in Somalia, how does it get turned into their local currency? I suspect the number of merchants willing to take bitcoins inside Somalia is somewhere between zero and none. Maybe they could send it to MtGox (Japan) and then... run into the same problem as every other currency.
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The_Duke
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September 06, 2011, 09:35:42 AM |
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They probably only cash out in AK47's though.
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NOT a member of the so called ''Bitcoin Foundation''. Choose Independence!
Donate to the BitKitty Foundation instead! -> 1Fd4yLneGmxRHnPi6WCMC2hAMzaWvDePF9 <-
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Jack of Diamonds
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September 06, 2011, 10:39:51 AM |
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They probably only cash out in AK47's though. Arms trafficking with zero traceability of ownership (given the rifles, bolts etc. have all their serials erased). No financial trail to follow either. What could go wrong? Bitcoins allow the perfect anonymous transaction for this type of items. Even better than physical cash or gold bars because instead of dozens of heavy bags, you just need a USB stick and a laptop (or just a smartphone). The seller also has 100% assurance he isn't receiving counterfeit currency in return.
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1f3gHNoBodYw1LLs3ndY0UanYB1tC0lnsBec4USeYoU9AREaCH34PBeGgAR67fx
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Hiro_Y3k
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October 14, 2014, 04:37:01 AM |
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Very interesting. I wonder what business historians will say 20 years from when they study the history and origins of Bitcoin.
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ANTIcentralized
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October 14, 2014, 06:00:59 AM |
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For example, a VC may invest $10 million in a company, in exchange for 10% of the stock in the company. At the time of investment, is the company worth $100 million? Not at all! But the VC hopes they'll be worth $200-$400 million in a few years, and they can double their money or more. This is not true. It is actually the opposite of this. VC is generally able to command a discount from the expected value of a business because of the lack of potential fundraising options, and the other options that are available would cause the company to incur significant, permanent additional costs. Shares in a new startup are usually vastly overpriced for a good reason: they need the money in order to make a business. And bitcoin exchanges and developers need money, too. Someone has to pay the lawyers in Mt. Gox's court case against the French bank later this month, and I'm glad to have contributed towards their expenses. And some early adopters are paying to develop FPGA miners, web site plug-ins, ATMs, and many other infrastructure tasks that take money and time, and I have, indirectly, contributed to their development costs, too. It's a zero sum game between the buyers, sellers, exchanges, and miners: no cash is being destroyed, it's just getting redistributed. And most importantly, none of it is going to Wall Street.
I'm holding, and will even likely buy more coins next month, at whatever the price it is then. And yes, a rant makes me feel better about having a lower face value on my held bitcoins. Having my money in the bitcoin economy instead of in a big bank feels good, even if the face value is currently less than I put in.
I do agree with the overall theory of your post that bitcoin will likely rise over time by a lot and that buying/holding bitcoin is very risky and is far from a certain investment, very similar to buying stock in a startup
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Wilhelm
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October 14, 2014, 07:27:50 AM |
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Yeah, only the shares are of a somalian company who will use the first half to bribe some local goverment officials and the second half to buy a small boat to go pirate some oil tankers that are headed your way. They then get shelled by a french navy ship and you never see any of your investments back. LOL love this post
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Bitcoin is like a box of chocolates. You never know what you're gonna get !!
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polynesia
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October 15, 2014, 01:37:29 AM |
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It is like a start up company, which already had an IPO. At least you can sell your bitcoins if you need money in a hurry.
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montreal
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October 15, 2014, 01:43:01 AM |
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Very interesting. I wonder what business historians will say 20 years from when they study the history and origins of Bitcoin.
I also enjoy lurking old threads....such a different scene then, and only a couple short years ago.
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pattu1
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October 15, 2014, 01:38:32 PM |
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Very interesting. I wonder what business historians will say 20 years from when they study the history and origins of Bitcoin.
I also enjoy lurking old threads....such a different scene then, and only a couple short years ago. The interesting thing is, these old threads are usually right.
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