Buy Bitcoin and hold it: 180% annual yield on average since the first halving

[BlackHatCoiner]

I made this thread just to remind you that, in the last eight years, Bitcoin gave you the chance to increase your annual yield by 180%. Specifically, here's some satisfying results of the end of July overtime:

From 2013 to 2014: $94 -> $600 (538%)
From 2014 to 2015: $600 -> $292 (51%)
From 2015 to 2016: $292 -> $624 (113%)
From 2016 to 2017: $624 -> $2,700 (332%)
From 2017 to 2018: $2,700 -> $8,100 (200%)
From 2018 to 2019: $8,100 -> $10,100 (24%)
From 2019 to 2020: $10,100 -> $10,900 (7.9%)
From 2020 to 2021: $10,900 -> $40,000 (266%)

If you sum them all, you'll see that it's a 180% annual yield. If that number applies in the next eight years, we have on average:

From 2021 to 2022: $40,000 -> $72,000
From 2022 to 2023: $72,000 -> $129,600
From 2023 to 2024: $129,600 -> $233,280
From 2024 to 2025: $233,280 -> $419,904
From 2025 to 2026: $419,904 -> $755,827.2
From 2026 to 2027: $755,827.2 -> $1,360,488.96
From 2027 to 2028: $1,360,488.96 -> $2,448,880.13
From 2028 to 2029: $2,448,880.13 -> $4,407,984.23

Have a nice day.

[mk4]

This is the main reason why I personally don't see the need of using bitcoin lending platforms. Sure, an extra 5-8% yield off your bitcoin(on top of the bitcoin value increase) can be quite sweet, but in exchange for handing over custody? Hell nah, I'm happy with my annual 2x-3x multipliers.

[BlackHatCoiner]

This is the main reason why I personally don't see the need of using bitcoin lending platforms.

Since the ancient times, lending wasn't a bad idea. You indeed handed over your custody, but you were also informed about the bank you're depositing. It wasn't wise to keep your money into your closet; you should invest or yield them somewhere. But, I'm not sure about the lending terms of those websites. Do they ask for KYC? Do we know who are they? Lending Bitcoin pseudonymously is like giving a stranger some cash by the promise you'll get more in return. What makes me feel that he'll not rip me off using a bullshit excuse (e.g bankruptcy)?

Worth writing that by keeping your money, you're actually investing in its inflation. You should never keep fiat money for long-term commitments, but rather lend them if you're not interested in investing them in stocks or estate.

Generally, for your long-term wealth you should always invest into things that never lost their intrinsic value.

[Torque]

Good job BlackHat.

But you forgot to add the conclusion "Show me another retail investment vehicle that has had better performance gains over the last 8 years."  

[Review Master]

If bitcoin again takes bullish rally and makes upto $100k , than bitcoin could hit 1 million usd within three years or less than that.  But it's great to have 2x-3x return annually rather than taking risks into other platforms or alts. Also, DCA will be the best strategy to grow our portfolio. 

[thecodebear]

This is the main reason why I personally don't see the need of using bitcoin lending platforms. Sure, an extra 5-8% yield off your bitcoin(on top of the bitcoin value increase) can be quite sweet, but in exchange for handing over custody? Hell nah, I'm happy with my annual 2x-3x multipliers.

Yeah, I put a bit of Bitcoin onto BlockFi a few months ago to get that 6% gain, but they've adjusted it down almost every single month since then, but now I get under 2%. It's less than a tenth of my bitcoin in the first place, as wasn't willing to risk more than that on a centralized place, but since they've cut my earnings rate by two-thirds in the past few months I will probably just move that back to my own address by end of this year. 2% is not worth giving over custody. 6% maybe, but 2% is bullshit.

[hatshepsut93]

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars. Do you seriously believe that a currency barely used for any consumer transactions and being used as an asset by a small number of tech companies has a chance to absorb most of world's GDP in 8 years?

IMO it's time to say goodbye to expected 180% returns and settle for more realistic 50% returns or 25% returns, which is still very good.

[Kemarit]

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars. Do you seriously believe that a currency barely used for any consumer transactions and being used as an asset by a small number of tech companies has a chance to absorb most of world's GDP in 8 years?

IMO it's time to say goodbye to expected 180% returns and settle for more realistic 50% returns or 25% returns, which is still very good.

Yeah, better to expect a realistic gain of 50% because that's a good numbers already.

Also we have to consider that the exponential growth will slow down and obviously there is a massive growth spurt in the beginning of bitcoin market.

But this growth is a good numbers to hedge against those anti-bitcoin, would love on how they contradict this because we all know that numbers don't lie.

[o_e_l_e_o]

I will probably just move that back to my own address by end of this year.

Given that BlockFi are currently caught up in a bunch of legal battles and are facing having some of their activities and products limited or even shutdown altogether, I think that would be a wise move. I doubt they would actively try to keep your coins from you, but since they are a fractional reserve system and loan out all the coins which are deposited to their platform (how else would they generate their profits), then if lots of people try to withdraw their coins in the face of regulations or legal troubles you could end up with effectively a bank run.

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars. Do you seriously believe that a currency barely used for any consumer transactions and being used as an asset by a small number of tech companies has a chance to absorb most of world's GDP in 8 years?

It won't reach the world's GBP in 8 years obviously, but it could very well be worth $4.4 million when the Fed casually prints a few more trillion and USD devalues by another >90%.

[adaseb]

This is the main reason why I personally don't see the need of using bitcoin lending platforms. Sure, an extra 5-8% yield off your bitcoin(on top of the bitcoin value increase) can be quite sweet, but in exchange for handing over custody? Hell nah, I'm happy with my annual 2x-3x multipliers.

Yeah, I put a bit of Bitcoin onto BlockFi a few months ago to get that 6% gain, but they've adjusted it down almost every single month since then, but now I get under 2%. It's less than a tenth of my bitcoin in the first place, as wasn't willing to risk more than that on a centralized place, but since they've cut my earnings rate by two-thirds in the past few months I will probably just move that back to my own address by end of this year. 2% is not worth giving over custody. 6% maybe, but 2% is bullshit.

I think the reason why it went down was due to the GBTC premium. Most of the BTC they were borrowing was for GBTC so market makers could milk the premium. However when the premium disappeared and turned negative they got in trouble. Hence why they couldn't afford to pay the 6% or so. And 6% in my opinion was a rip off since they were making more than double it for your BTCs.

Whats popular is to lend USD and USDT however. Those historically (except bear markets) usually will yield you around 10% a year. So if you sold some crypto that you don't need. You can just lend it out for 10% instead of leaving it in your bank account to get 0.5% APY. However keep in mind there is still counterparty risks, You can't lend it while its in cold storage.

[BlackHatCoiner]

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars.

The key word here is “today”. In disruptive innovation, digital transformation is the most potential opportunity. In 2028-2029 that I have predicted $2.4M - $4.8M, you can't be sure about the GDP.

A 2017 interim report claims that digital transformation "could deliver $ 100 trillion in value to business and society over the next decade

Whats popular is to lend USD and USDT however. Those historically (except bear markets) usually will yield you around 10% a year. So if you sold some crypto that you don't need. You can just lend it out for 10% instead of leaving it in your bank account to get 0.5% APY. However keep in mind there is still counterparty risks, You can't lend it while its in cold storage.

Since when USDT can be kept in a cold storage? It is completely centralized and the mint is Tether Limited AKA Bitfinex. How do you think they manage to balance it with the USD's value?

[zanezane]

This is the main reason why I personally don't see the need of using bitcoin lending platforms. Sure, an extra 5-8% yield off your bitcoin(on top of the bitcoin value increase) can be quite sweet, but in exchange for handing over custody? Hell nah, I'm happy with my annual 2x-3x multipliers.

But there's nothing wrong with doing the lending platforms, I mean I make a lot of my portfolio through those although I agree that surrendering full custody of your coins is a bad thing so I only use about 25% of my bitcoin there and the other sit for a long while throughout all the seasons.

[Poker Player]

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars. Do you seriously believe that a currency barely used for any consumer transactions and being used as an asset by a small number of tech companies has a chance to absorb most of world's GDP in 8 years?

That is a fallacy. It's like if you say I can't have $1M net worth because my annual income is $50K.

The GDP is the annual income, the wealth accumulated is another thing.

Total global wealth is $431 trillion.

It is, of course, possible that Bitcoin, which is currently succeeding as a store of value, will absorb much of that figure. That is the thesis of Saylor and others.

IMO it's time to say goodbye to expected 180% returns and settle for more realistic 50% returns or 25% returns, which is still very good.

On this I do agree, it would be normal for growth to slow down.

[GreatArkansas]

From 2014 to 2015: $600 -> $292 (48%)

Let's try to look on the other way around,

With the current price of Bitcoin and volume, is there any chance that we could experience what happened from 2014 to 2015?
Like if you can see, 48% down from that year. If this is the case, short-term investors or believe will only get affected, and if you are for the long term, it will be worth it, the first post is the evedence.

[o_e_l_e_o]

However keep in mind there is still counterparty risks, You can't lend it while its in cold storage.

There are double the amount of counterparty risks. Obviously there is all the risk from depositing your coins with a third party lending platform, and there is also all the risk from holding a centralized coin which is owned, operated, and controlled by a single entity and is not backed up 1-to-1 with USD as has been claimed. You are at double the risk of default, double the risk of bank runs, and double the risk of losing everything. All for what? 0.5% a year? No thanks.

Since when USDT can be kept in a cold storage?

You can still move USDT to a hardware wallet, for example, but as you rightly point out, it remains entirely centralized meaning Tether can choose to freeze your coins and addresses and render your USDT worthless, even if it is in cold storage.

With the current price of Bitcoin and volume, is there any chance that we could experience what happened from 2014 to 2015?

A 50% drop from current prices is only back to $20k. That is absolutely within the realms of possibility. We may well never see that price again, but what a great time to buy the dip if we do.

[tabas]

Ahh, I just have to hold for 2 more halvings and it's going to be a dream come true. <3
The projection is lovely to look at and even if we know that there would usually be the crashes that we have to consider, still having this positivity until we finally see those 6-7 digits will be the best days of our lives.

[BlackHatCoiner]

There are double the amount of counterparty risks. Obviously there is all the risk from depositing your coins with a third party lending platform, and there is also all the risk from holding a centralized coin which is owned, operated, and controlled by a single entity and is not backed up 1-to-1 with USD as has been claimed. You are at double the risk of default, double the risk of bank runs, and double the risk of losing everything. All for what? 0.5% a year? No thanks.

You also have to trust the fiat currency these guys in Bitfinex are trying to balance with your “stable” coin. If the dollar inflates, so does the Tether, because 1 USDT should always be equal with 1 USD. So, I'd say it's tripling the amount of counterparty risks.

You can still move USDT to a hardware wallet

I've never googled it, but how is the verification of the transactions done? Are there blocks? Are we talking about a cryptocurrency that works on a block chain and uses cryptography to operate? If it's centralized, there's no point to require any mechanism for the verification; there's not even a point on using cryptography besides the coin control part. I guess that ECDSA would still be needed to prove you own USDT.

[o_e_l_e_o]

If the dollar inflates, so does the Tether, because 1 USDT should always be equal with 1 USD. So, I'd say it's tripling the amount of counterparty risks.

That's also true, and even if you ignore the fact that Tether only hold about ~5% of the total USDT in cash (yes, 5%, you read that right: https://tether.to/wp-content/uploads/2021/05/tether-march-31-2021-reserves-breakdown.pdf), then holding USDT is even worse than holding fiat in terms of security and gradually but steadily losing money.

I've never googled it, but how is the verification of the transactions done? Are there blocks? Are we talking about a cryptocurrency that works on a block chain and uses cryptography to operate?

It's a token. It was initially launched on Bitcoin's Omni layer, and then spread to an Ethereum ERC20 token as well as a token on a number of other altcoin platforms. Because it is run from a smart contract, Tether have the ability to blacklist coins, freeze transactions, and issue new coins, all from any address, at any time. It matters not if you've moved your USDT on to an Ethereum address generated from an airgapped machine. Do something Tether don't like, and your coins are worthless. Not to mention at any point they could just give themselves a few billion tokens and dump them on the market. (Although if you look at the exponential rise in their marketcap - from $20 billion to $60 billion in the last 6 months - some might argue they are already doing exactly that.)

[LoyceV]

From 2014 to 2015: $600 -> $292 (48%)

Did you mean -51%?

But you forgot to add the conclusion "Show me another retail investment vehicle that has had better performance gains over the last 8 years."  

Netflix comes closest with a 3,767% increase in 10 years. But it still can't keep up with Bitcoin.

Bitcoin @ 4.4 million would have a marketcap around ~77 trillion. The global GDP estimated today is 93.8 trillion US dollars. Do you seriously believe that a currency barely used for any consumer transactions and being used as an asset by a small number of tech companies has a chance to absorb most of world's GDP in 8 years?

If you compare to GDP, many other markets are ridiculously large too. Forex trading for instance does $6.6 trillion per day, and is worth $2,409 trillion (17 times larger than global GDP). So compared to Forex trading, Bitcoin is now at only 0.03% and can easily grow a whole lot bigger!

IMO it's time to say goodbye to expected 180% returns and settle for more realistic 50% returns or 25% returns, which is still very good.

I agree though, exponential growth will at some point have to flatten towards an S curve.

[decodx]

IMO it's time to say goodbye to expected 180% returns and settle for more realistic 50% returns or 25% returns, which is still very good.

I agree though, exponential growth will at some point have to flatten towards an S curve.

Yes, but the question is when? From the next halving? The one after that?
I think 150%-200% is still very possible. That's just over $100k compared to the current price.