How is bitcoin worth buying now at these prices?

[thecodebear]

You don't need to "buy low, sell high." You can also "buy high, sell higher."

Tabling the discussion of Bitcoin's fundamentals, three words actually explain why BTC is worth buying right now: greater fool theory.

In finance and economics, the greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by the local and relative demand of a specific consumer.

In real estate, the greater fool theory can drive investment through the expectation that prices always rise. A period of rising prices may cause lenders to underestimate the risk of default.

In the stock market, the greater fool theory applies when many investors make a questionable investment, with the assumption that they will be able to sell it later to "a greater fool". In other words, they buy something not because they believe that it is worth the price, but rather because they believe that they will be able to sell it to someone else at an even higher price. It is also called survivor investing.

https://en.wikipedia.org/wiki/Greater_fool_theory

Keynes referred to this behavior as a "beauty contest" and thought of it as a defining characteristic of markets:

Keynes described the action of rational agents in a market using an analogy based on a fictional newspaper contest, in which entrants are asked to choose the six most attractive faces from a hundred photographs. Those who picked the most popular faces are then eligible for a prize.

A naive strategy would be to choose the face that, in the opinion of the entrant, is the most handsome. A more sophisticated contest entrant, wishing to maximize the chances of winning a prize, would think about what the majority perception of attractiveness is, and then make a selection based on some inference from their knowledge of public perceptions. This can be carried one step further to take into account the fact that other entrants would each have their own opinion of what public perceptions are. Thus the strategy can be extended to the next order and the next and so on, at each level attempting to predict the eventual outcome of the process based on the reasoning of other rational agents.

"It is not a case of choosing those [faces] that, to the best of one's judgment, are really the prettiest, nor even those that average opinion genuinely thinks the prettiest. We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees." (Keynes, General Theory of Employment, Interest and Money, 1936).

Keynes believed that similar behavior was at work within the stock market. This would have people pricing shares not based on what they think their fundamental value is, but rather on what they think everyone else thinks their value is, or what everybody else would predict the average assessment of value to be.

https://en.wikipedia.org/wiki/Keynesian_beauty_contest

Focusing only on the underlying fundamental value is sort of basic, first order thinking. Second order thinking would account for the perceptions of the market.

If the rest of the market is buying BTC because they think it's going to the moon, how much does your assessment of Bitcoin's fundamentals really matter? It doesn't!

I mean yeah markets don't react purely to fundamentals, actors within markets react based on how they think others will react. Look at the stock market, there is no earthly reason it should have rebounded from the March drop, yet it's breaking record now simply because it's a money game and everyone assumes everyone else is going to keep buying, so everyone keeps buying.

Everyone who knows anything about Bitcoin knows it is custom built for price appreciation, and knowing this makes people expect the market to keep going up in general, so there is always some sense of FOMO that if you don't buy now you'll just have to buy higher if you want to make money.

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[zeingrind777]

I don't know if today is the right time to buy bitcoin? I have sold my bitcoin for $ 25k and it is a top value for me. looks like the bull market is still very strong and bitcoin will continue to rise, but I am still hesitant to buyback. while waiting for the bitcoin price to drop, I daily traded different altcoins to multiply the money.

[bitterguy28]

With the price of it 25k at the moment... even when its 20k... in order to double your money, you need it to hit 50k or 40k.  That number still looks so far away with how much btc has went up this year.  And imagine wanting to 5x your money. 

Its Our money ,why care ?then Invest in something else we don't Care.

Yea i know you would say... imagine btc is 50k or 100k or 300k, then what about then?  Well by then, i don't even know how it would make any sense to buy it as even doubling your money would be extremely hard.

Because We Know the meaning of HOLDING ,and that is the essence of wanted a safer and not stressful coins.

Yeah you can at least choose other cheap and fast moving coins ,But assurance? that you will Never be scam or victim of Pump and dump ?

at least in Bitcoin  safety is what we have and also we are not in a Hurry ,so

For example I don't know anything about stocks but i think i rather buy a random stock and it has a much better chance to double in price than btc when its 25k.  Thoughts on this?

Random stocks , and random chance also?

Why dare to choose stocks that you have no knowledge ?even in Bitcoin i will never ask you to buy first ,study and learn more at least you are ready if what happens along the way.

[Wingsbtc]

In this case the higher the risk the lesser the investment, how about that? Invest very little amount of money just in case, we can say bitcoin will hit 50k but bounce back at 30k, very risky IMO, to double your gains or expect more like 5x altcoins is the best plan right now

[adaseb]

By the time of an IPO, the real money has already been made by venture capitalists. The vertical part of the s-curve of adoption is long gone. The retail suckers who buy through brokers are just being thrown scraps.

Yes you couldn't be even more correct. The perfect recent example of this is what happened with the DoorDash IPO last month. The DASH price IPO was like $102. And when it launched it went all the way up to $200 pretty much. Pretty sure no retail trader bought it at $102. Most bought at almost $200 and now the price is crashing all the way to most likely the IPO price, its currently at $147 or so.

This is a prime example why its not always easy trading stocks. Sure sometimes you get lucky. However if you buy a bluechip stock like McDonalds or CocaCola how much profit are you going to earn per year, maybe 5-10%. Sure better than a savings account however unless you are a millionaire, never going to get rich that way. You can try and trade options, however know that they all got huge premiums and most expire useless.

[rodskee]

With the price of it 25k at the moment... even when its 20k... in order to double your money, you need it to hit 50k or 40k.  That number still looks so far away with how much btc has went up this year.  And imagine wanting to 5x your money. 

For someone Like you who does now have a concrete Knowledge and understanding about Bitcoin and how this investment place is ,Better keep away from buying this coins for  now,and instead focus in some Reliable altcoins .

For example I don't know anything about stocks but i think i rather buy a random stock and it has a much better chance to double in price than btc when its 25k.  Thoughts on this?

In my belief Stocks is different from crypto investing.

and also It's not advisable buying Bitcoin in this Hyping process ,if you can wait then by next year or when the correction comes.

[exstasie]

The perfect recent example of this is what happened with the DoorDash IPO last month. The DASH price IPO was like $102. And when it launched it went all the way up to $200 pretty much. Pretty sure no retail trader bought it at $102. Most bought at almost $200 and now the price is crashing all the way to most likely the IPO price, its currently at $147 or so.

This is a prime example why its not always easy trading stocks. Sure sometimes you get lucky. However if you buy a bluechip stock like McDonalds or CocaCola how much profit are you going to earn per year, maybe 5-10%. Sure better than a savings account however unless you are a millionaire, never going to get rich that way. You can try and trade options, however know that they all got huge premiums and most expire useless.

I always avoid IPOs for that reason. The only exception is quickly flipping to greater fools during the launch hype, knowing it's likely to come back down near the IPO price.

I would say there is some middle ground between buying into IPO craze and investing in blue chips. In fact, I'd avoid picking stocks at all and focus on sector wide trades.

One of my favorite equity listings is BLOK, an ETF that heavily invests in crypto platforms, related funds and auxiliary services, and also has some BTC exposure, along with some general tech industry exposure. I see crypto and tech stocks riding the same overall wave, reinforcing each other's bull markets, and unlike trying to pick blue chips, I would expect BLOK to consistently outperform the S&P500 and other benchmarks, at least given the current monetary policy context.

https://www.barrons.com/quote/fund/us/arcx/blok

[justdimin]

There will always be some sort of corrections and falls in between of our going up, but when you can't break over even further, realize that it may not be the greatest situation neither. because you may want to see bigger increases afterwards, but this is basically where we are stuck. When it goes down people worry that it will crash, when it goes up people hype about going to insane levels, nobody considers the fact that maybe the price is stuck between a bit under $23k and a bit under $24k prices? And its not moving too much above $27k and not moving under $26k neither.

I think just like the time it was stuck between $17k-19.5k levels, it is going to be about the same once again and not change all that much, in the end we went up and down between those levels for a whole month even a bit more, in the end we broke over the $25k barrier and reached to around $28k which means we may target $40k in coming months.

[Reatim]

All you have to do inorder to double your money is to buy now and hodl but if you want a quick way to double your money why not try trading futures with high leverage yeah its kinda risky than spot but if your lucky you can double your money in just a week or less I can see some trader with a profit almost 100% in 24 hours but if you are hoping to double your money by just waiting the btc price to increase 2x then you need to wait and have patience..

Buying at 28,000$ value won't give you double in the next year of holding ,We might reach another ATH this year but we also knew that halving is what the factor market shows us .
for the last halving years we are recording each ATH so maybe if you are capable of Holding long term it is reasonable buying today,but if not then consider waiting for the correction ,or Try Altcoin for a while .
I'm planning to at least take half of my  Bitcoin either tonight or tomorrow and invest in some falling altcoins in market since i know they will recover once the bitcoin run rest a while.

[Dollar_Hunter]

Bitcoin has broken out, and we don't need to be afraid to buy it,
but short term Bitcoin can still be up to $ 30k, but remember a correction might come after that,
if you want to invest in Bitcoin it's time and buy back again when the price correction.

[jostorres]

The perfect recent example of this is what happened with the DoorDash IPO last month. The DASH price IPO was like $102. And when it launched it went all the way up to $200 pretty much. Pretty sure no retail trader bought it at $102. Most bought at almost $200 and now the price is crashing all the way to most likely the IPO price, its currently at $147 or so.

This is a prime example why its not always easy trading stocks. Sure sometimes you get lucky. However if you buy a bluechip stock like McDonalds or CocaCola how much profit are you going to earn per year, maybe 5-10%. Sure better than a savings account however unless you are a millionaire, never going to get rich that way. You can try and trade options, however know that they all got huge premiums and most expire useless.

I always avoid IPOs for that reason. The only exception is quickly flipping to greater fools during the launch hype, knowing it's likely to come back down near the IPO price.

I would say there is some middle ground between buying into IPO craze and investing in blue chips. In fact, I'd avoid picking stocks at all and focus on sector wide trades.

One of my favorite equity listings is BLOK, an ETF that heavily invests in crypto platforms, related funds and auxiliary services, and also has some BTC exposure, along with some general tech industry exposure. I see crypto and tech stocks riding the same overall wave, reinforcing each other's bull markets, and unlike trying to pick blue chips, I would expect BLOK to consistently outperform the S&P500 and other benchmarks, at least given the current monetary policy context.

https://www.barrons.com/quote/fund/us/arcx/blok

You both are forgetting that big banks and other places that are filled with whales usually end up getting in before the IPO officially starts and put up their numbers, which means by the time IPO is actually officially open, they will be the first ones to get it, think of it the same was as you might buy a game pre-order before it is released, and one day before the release you get to download it, and on the second its released you are ready to start playing whereas anyone who buys at the release would have to wait at least until its downloaded.

So, IPO's are bought by big banks way before they are officially starting, and they buy from lower end of the price, all those who buy at 200 are not banks, usually just regular investors like us. Plus buying blue chip to make %10 a year is not that bad, if you do that for 30-40 years, you retire a rich person, not a bad idea, just doesn't make you rich overnight that's all.