Don't rely on Venture capital money - these guys don't know what they're doing

[tvbcof]

...
Let's take a few examples shall we?

Tim Draper. Big VC guy, billionaire. He bought BTC in the millions at $500-600. Then he posted on twitter stuff like: "if I was Russian I would buy bitcoin right now". Right before the ridiculous BTC crash.

Does it look like he knows what he's doing?
No.

What about Bill Miller? I have enormous respect for the guy, but he bought BTC at $500. Let's be honest, he screwed up big time.

What about Barry Silbert and his fund investors who can't liquidate their holdings from the fund and they are stuck with their bags?
Did he fuck up? You tell me.

Those guys are now public Bitcoin BAGHOLDERS. We are not talking about small percentages. They lost millions.
...

That may or may not be the case.  The truly proficient would probably recognize that a great deal of fruit is still up in the tree and would just require a certain amount of 'wasted energy' and risk of a strained back to shake it free.  On top of that, the violent shaking is likely to scare away most of the competition from the more primitive gathering groups.

So, it may be the case that you are ridiculing people for wasting all their energy pushing the tree back and forth while they could just look around in the grass for the olives that are there already.

Or they might just be bagholders.  I dunno.  They probably didn't get the funds they have by being stupid however.  Assuming otherwise could be a mistake.

[tvbcof]

...I understand that but I feel like its still possible to get VC funding with Bitcoin companies...

Yes.  If you're good at getting VC funding.  It's sorta like getting grants--a skill in itself.

A fair bit more than 'sorta like' as I see it.

[inca]

I see  a lot of people in here getting excited about VC money being poured in the bitcoin space (like the NSYE news) and taking it as some guarantee that the bitcoin's price is gonna go to the moon because of that.

Wrong.

First of all, some of them are investing in bitcoin exchanges, not in bitcoin itself. BTC price could crash to $10 and exchanges would do fine. Bitcoin "investors"? not so much.

Secondly, some of the VC guys investing in this space don't know what they are doing or what they are really getting into.
Now permabulls will probably shout at me something like:
-"you troll! We are talking about Citi CEO and NSYE! Do you think you know more than them of what's going on? Hahaha"

K.


Let's take a few examples shall we?

Tim Draper. Big VC guy, billionaire. He bought BTC in the millions at $500-600. Then he posted on twitter stuff like: "if I was Russian I would buy bitcoin right now". Right before the ridiculous BTC crash.

Does it look like he knows what he's doing?
No.

What about Bill Miller? I have enormous respect for the guy, but he bought BTC at $500. Let's be honest, he screwed up big time.

What about Barry Silbert and his fund investors who can't liquidate their holdings from the fund and they are stuck with their bags?
Did he fuck up? You tell me.

Those guys are now public Bitcoin BAGHOLDERS. We are not talking about small percentages. They lost millions.

Oh, and they invested on bitcoin directly, unlike others who invested in exchanges, who are not technically dependent on the bitcoin price to rise...


You still think you should take VC money as a guarantee that nothing can go wrong (it can easily fail by definition FFS)?  Or even better, as a guarantee that any VC money in exchanges is gonna make bitcoin's price go to the moon even if the two are not directly related?


There was a lot of VC money during the dotcom bubble too. Just sayin'.

I am sensing a lot of fear on this forum, but not in the bulls who have seen this all before, but in the bears who seem to have convinced themselves bitcoin will fail and are using a downsloping chart to justify it.

Yesterday US banks and senior bankers began to publicly invest in bitcoin infrastructure. In the next few days US regulation will be announced. It has begun. If you don't think the action of the last few months was bitcoin being entered by major players you deserve to be wiped out shorting a hyper volatile asset like bitcoin.

Keep droning on about Tim draper, about mining costs, coin inflation, 'it's the blockchain not bitcoin' to your merry hearts content. You will shortly be proven wrong. Most of you know it, too.

[NotLambchop]

...
Keep droning on about Tim draper...

Tim Draper tho...

[WTrader]

...
Keep droning on about Tim draper...

Tim Draper tho...

http://s29.postimg.org/pdt3ue9t3/99268907_Smeyus_64786264_freaks.gif

I see  a lot of people in here getting excited about VC money being poured in the bitcoin space (like the NSYE news) and taking it as some guarantee that the bitcoin's price is gonna go to the moon because of that.

Wrong.

First of all, some of them are investing in bitcoin exchanges, not in bitcoin itself. BTC price could crash to $10 and exchanges would do fine. Bitcoin "investors"? not so much.

Secondly, some of the VC guys investing in this space don't know what they are doing or what they are really getting into.
Now permabulls will probably shout at me something like:
-"you troll! We are talking about Citi CEO and NSYE! Do you think you know more than them of what's going on? Hahaha"

K.


Let's take a few examples shall we?

Tim Draper. Big VC guy, billionaire. He bought BTC in the millions at $500-600. Then he posted on twitter stuff like: "if I was Russian I would buy bitcoin right now". Right before the ridiculous BTC crash.

Does it look like he knows what he's doing?
No.

What about Bill Miller? I have enormous respect for the guy, but he bought BTC at $500. Let's be honest, he screwed up big time.

What about Barry Silbert and his fund investors who can't liquidate their holdings from the fund and they are stuck with their bags?
Did he fuck up? You tell me.

Those guys are now public Bitcoin BAGHOLDERS. We are not talking about small percentages. They lost millions.

Oh, and they invested on bitcoin directly, unlike others who invested in exchanges, who are not technically dependent on the bitcoin price to rise...


You still think you should take VC money as a guarantee that nothing can go wrong (it can easily fail by definition FFS)?  Or even better, as a guarantee that any VC money in exchanges is gonna make bitcoin's price go to the moon even if the two are not directly related?


There was a lot of VC money during the dotcom bubble too. Just sayin'.

I am sensing a lot of fear on this forum, but not in the bulls who have seen this all before, but in the bears who seem to have convinced themselves bitcoin will fail and are using a downsloping chart to justify it.

Yesterday US banks and senior bankers began to publicly invest in bitcoin infrastructure. In the next few days US regulation will be announced. It has begun. If you don't think the action of the last few months was bitcoin being entered by major players you deserve to be wiped out shorting a hyper volatile asset like bitcoin.

Keep droning on about Tim draper, about mining costs, coin inflation, 'it's the blockchain not bitcoin' to your merry hearts content. You will shortly be proven wrong. Most of you know it, too.

These people have the attention span of a hammered goldfish in regards to the investment world. Do they really think those VC funds and billionaires are worried about an investment that they are prepared to take on for more then 5 to 6 years?

These price changes will be nothing once the actual technology gains traction mainstream, which is a good 3-4 years ahead. There is no way the OP can compete with that type of thinking since it is clearly obvious he lacks both financial standing and experience to support himself during these 'bear markets'.

That kind of thinking is not 'understood', only experienced. EFT, VC, and other real money are not geniuses, but still far out strips OP in terms of long term considerations.

[NotLambchop]

Welcome to the forum, newfriend!  Nice first post, much wisdom

[mtwelve]

Which is why it's paramount to get in while you can

[God27]

Coinbase is a great investment. If bitcoin doesn't work out, then they can easily fall back and be the most trusted P2P ripple gateway.

[B.A.S.]

Coinbase data mines the shit out of its user base. NYSE (a public clearinghouse) injects fresh capital into Coinbase to offer its support. Coincedence? I think not. NYSE is grooming Coinbase as its new foray into digital clearinghouses. As a side note, coupled with the NYSE investment, I'm sure Mr. Pandit is still butt hurt about Citigroup. What a better way to get back in the running than to take sweet revenge on your old banking buddies via BTC...

[azguard]

we better start our own bitcoin business its good right.
we can earn and loose all we want.

question is is it right time to start btc business

[tvbcof]

These people have the attention span of a hammered goldfish in regards to the investment world. Do they really think those VC funds and billionaires are worried about an investment that they are prepared to take on for more then 5 to 6 years?

These price changes will be nothing once the actual technology gains traction mainstream, which is a good 3-4 years ahead. There is no way the OP can compete with that type of thinking since it is clearly obvious he lacks both financial standing and experience to support himself during these 'bear markets'.

That kind of thinking is not 'understood', only experienced. EFT, VC, and other real money are not geniuses, but still far out strips OP in terms of long term considerations.

Likely quite true.  People who play with more money than they can comfortably sit on for multiple years will probably need more luck than anything to not end up road-kill.

Secondly, if Bitcoin crashes and burns in the fairly long time-spans that we are talking about (which is entirely possible) there is a fair chance that a replacement will pick up where the old blockchain left off or perhaps at some strategic point shortly before.  This because the representations of value therein are by this time distributed widely enough among the people who matter to give a new effort a running start.  Probably some of the more shrewd investors (using the term loosely) consider this.  Actually, I would guess that many many replacements would do just this so the main trick will be to pick which one comes out on top...or wait long enough to find out.

I still say that VCs who plunk good money down on top of efforts which anticipate Bitcoin as an exchange currency for buying trinkets are fools.  One could barely design a more ineffective system for doing this.  The only hope for these folks is that but size bloats and Bitcoin is adopted by an internet giant, but it would take amazing marketing skill to have Bitcoin retain anything of it's initial appeal in such a scenario.  OTOH, betting against the stupidity of the masses...

[NotHatinJustTrollin]

"Nobody has any interest in using Bitcoin"
=> Network grows exponentially, 5 years in a row

Does that give an indication that the number of people owning bitcoin but especially USING IT AS A CURRENCY (and not just for speculative purposes as an end to itself) is anyway significant? No. The only indication of how many people owning bitcoin is this:
https://bitscan.com/bitnews/item/how-many-people-really-own-bitcoins-and-why-does-it-matter

Low numbers, and that was in january-february 2014, any new guys coming in that were not traders got screwed with it because of price.
Don't know how many more people actually got into the game and sticked to it after that.

Aside from reasons related to drugs or wild speculation (profitable and easy trading of a volatile asset), who is using BTC? Mostly people who already own bitcoin for these purposes.

Why should the average Joe buy bitcoin and use it as a currency, if he is not interested in the use cases I just mentioned?
I mean, why are you here? Why do you own bitcoin? For speculative purposes amirite?
Me too tbh, to trade it.
Now why should the average Joe give two shits about all that?

-as a store of value? bitcoin is a shitty store of value, you said it yourself in a post recently. And 2014 clearly shows it (a whole year of terror if you hodled like a fool).

-because no fees? Volatility can fuck that over real good, so no point in saving 1-3% when you can lose 10-30% in a few days. You might argue that over time (IF bitcoin succeeds) volatility will gradually decrease. While I have doubts about that, in the long run bitcoin transaction fees will be higher anyway. I guess you know that miners “need to be paid” in order for bitcoin and the blockchain to exist, whether thanks to ridiculous inflation, or transaction fees. The blockchain is not gratis.
Peter Todd said it himself: “regarding fee economics, we’re fucked”.


So why should the average Joe put up with bitcoin’s volatility and the possibility of having his funds easily stolen (if he has to move his money around, you can’t just keep it in cold storage forever you know) and no consumer protection?
Why?


For musical chairs-ponzi speculative purposes or drugs, that’s why. But guess what, not enough people care about that to justify a high BTC price.


The masterplan for bitcoin’s world adoption and earth domination might not work out as expected I’m afraid…

==> "Okay, nobody other than a few nerds and libertards is ever going to use or accept Bitcoin"
===> Microsoft online, Overstock, Dell, Newegg
====> "They don't really accept Bitcoin, they convert most of it to USD immediately. Big money despises Bitcoin."
======> $75 million investment in Coinbase, by New York Stock exchange, among others
=======> "They don't actually think Bitcoin is useful or is going to stick around.

As you said, these companies "accepting bitcoin" is just self-promotion and marketing, since they actually DON'T really accept bitcoins.

Who said “big money dislikes bitcoin”? Some big money bought it and is now bagholding it, as I showed in my first post.
Not only that, but VC money can easily fail, these guys are humans and not perfect. Like Tim Draper, Bill Miller, Barry Silbert and others. But most importantly, NSYE invested in an exchange not in bitcoin itself, that simply doesn’t imply that bitcoin price will be higher and that it won’t crash.
Simple as that.

They invested in an exchange in the cryptocurrency space.

What are other big money/names saying about the cryptocurrency space for example?

What is the Federal reserve bank saying about it?
Let’s have a quick look:

http://newsbtc.com/2015/01/22/federal-reserve-bank-vp-acknowledges-ripple-bitcoins-original-ledger/

What about Bill Gates about saving the unbanked and giving them access to financial services?
Let’s check it out:

http://www.coindesk.com/bill-gates-bitcoin-alone-wont-solve-global-payments-challenges/

To return to my dotcom bubble analogy, yes, bitcoin = world.com, pets.com


Now, the ripple network better represents the “internet-dotcom” analogy because it’s simply a technology (sure there is XRP the currency, but it’s not necessary to give a fuck about that as opposed to bitcoin in the blockchain system, which is a flawed concept), like the internet.

Ripple is just an example that takes what is promising about distributed ledger technology but without all the fuck ups (https://bitcointalk.org/index.php?topic=927036.msg10177316#msg10177316) that make the bitcoin blockchain not viable long term and without the NECESSARY incorporated pets.com get-rich-quick-but-without-a-real-purpose ponzi investment (bitcoin).


The analogy of the internet works because bitcoiners represent the dudes that during early internet days wanted to buy “shares of the internet”, but since you can’t technically do that, they stick to pets.com because at least that investment could make them rich quick, in theory.
The analogy works perfectly.

It’s pretty understandable why bitcoiners don’t like ripple the network. Right?


Again, ripple is just an example. Others projects in the cryptocurrency space might come up with something similar and better, replacing the ripple network and become “the internet” of my analogy.
I’m not promoting the ripple network itself, just to be clear.

[DoubleTrouble]

Whilst you are right and that we should not rely on it, it is still great for the overall bitcoin economy.

[Paashaas]

"Nobody has any interest in using Bitcoin"
=> Network grows exponentially, 5 years in a row

Does that give an indication that the number of people owning bitcoin but especially USING IT AS A CURRENCY (and not just for speculative purposes as an end to itself) is anyway significant? No. The only indication of how many people owning bitcoin is this:
https://bitscan.com/bitnews/item/how-many-people-really-own-bitcoins-and-why-does-it-matter

Low numbers, and that was in january-february 2014, any new guys coming in that were not traders got screwed with it because of price.
Don't know how many more people actually got into the game and stick to it after that.

Aside from reasons related to drugs or child pr0nz or wild speculation (profitable and easy trading of a volatile asset), who is using BTC? Mostly people who already own bitcoin for these purposes.

Why should the average Joe buy bitcoin and use it as a currency, if he is not interested in the use cases I just mentioned?
I mean, why are you here? Why do you own bitcoin? For speculative purposes amirite?
Me too tbh, to trade it.
Now why should the average Joe give two shits about all that?

-as a store of value? bitcoin is a shitty store of value, you said it yourself in a post recently. And 2014 clearly shows it (a whole year of terror if you hodled like a fool).

-because no fees? Volatility can fuck that over real good, so no point in saving 1-3% when you can lose 10-30% in a few days. You might argue that over time (IF bitcoin succeeds) volatility will gradually decrease. While I have doubts about that, in the long run bitcoin transaction fees will be higher anyway. I guess you know that miners “need to be paid” in order for bitcoin and the blockchain to exist, whether thanks to ridiculous inflation, or transaction fees. The blockchain is not gratis.
Peter Todd said it himself: “regarding fee economics, we’re fucked”.


So why should the average Joe put up with bitcoin’s volatility and the possibility of having his funds easily stolen (if he has to move his money around, you can’t just keep it in cold storage forever you know) and no consumer protection?
Why?


For musical chairs-ponzi speculative purposes or drugs or child pr0nz, that’s why. But guess what, not enough people care about that to justify a high BTC price.


The masterplan for bitcoin’s world adoption and earth domination might not work out as expected I’m afraid…

==> "Okay, nobody other than a few nerds and libertards is ever going to use or accept Bitcoin"
===> Microsoft online, Overstock, Dell, Newegg
====> "They don't really accept Bitcoin, they convert most of it to USD immediately. Big money despises Bitcoin."
======> $75 million investment in Coinbase, by New York Stock exchange, among others
=======> "They don't actually think Bitcoin is useful or is going to stick around.

As you said, these companies "accepting bitcoin" is just self-promotion and marketing, since they actually DON'T really accept bitcoins.

Who said “big money dislikes bitcoin”? Some big money bought it and is now bagholding it, as I showed in my first post.
Not only that, but VC money can easily fail, these guys are humans and not perfect. Like Tim Draper, Bill Miller, Barry Silbert and others. But most importantly, NSYE invested in an exchange not in bitcoin itself, that simply doesn’t imply that bitcoin price will be higher and that it won’t crash.
Simple as that.

They invested in an exchange in the cryptocurrency space.

What is other big money/names saying about the cryptocurrency space for example?

What is the Federal reserve bank saying about it?
Let’s have a quick look:

http://newsbtc.com/2015/01/22/federal-reserve-bank-vp-acknowledges-ripple-bitcoins-original-ledger/

What about Bill Gates about saving the unbanked and giving them access to financial services?
Let’s check it out:

http://www.coindesk.com/bill-gates-bitcoin-alone-wont-solve-global-payments-challenges/

To return to my dotcom bubble analogy, yes, bitcoin = world.com, pet.com


Now, the ripple network better represents the “internet-dotcom” analogy because it’s simply a technology (sure there is XRP the currency, but it’s not necessary to give a fuck about that as opposed to bitcoin in the blockchain system, which is a flawed concept), like the internet.

Ripple is just an example that takes what is promising about distributed ledger technology but without all the fuck ups (https://bitcointalk.org/index.php?topic=927036.msg10177316#msg10177316) that make the bitcoin blockchain not viable long term and without the NECESSARY incorporated pets.com get-rich-quick-but-without-a-real-purpose ponzi investment (bitcoin).


The analogy of the internet works because bitcoiners represent the dudes that during early internet days wanted to buy “shares of the internet”, but since you can’t technically do that, they stick to pets.com because at least that investment could make them rich quick, in theory.
The analogy works perfectly.

It’s pretty understandable why bitcoiners don’t like ripple the network. Right?


Again, ripple is just an example. Others projects in the cryptocurrency space might come up with something similar and better, replacing the ripple network and become “the internet” of my analogy.
I’m not promoting the ripple network itself, just to be clear.

Again; bla bla bla bla bla bla pure 100% horseschit.

Go read this idiot; http://www.nasdaq.com/article/big-wall-street-players-investing-in-bitcoin-startup-cm435611#ixzz3PeetWZxz

[NotHatinJustTrollin]

Again; bla bla bla bla bla bla pure 100% horseschit.

Nice arguments, you definitely sound like a smart, critically thinking investor.

Go read this idiot; http://www.nasdaq.com/article/big-wall-street-players-investing-in-bitcoin-startup-cm435611#ixzz3PeetWZxz

Again, not investments in bitcoin itself, VC money can fail, and even if it doesn't, it does not imply a high BTC price and doesn't imply BTC will survive.


You are easily impressionable by hype articles. I guess you're one of the dudes that said "you bear trolls are idiots, Barry Silbert just said that Wall Street money is going to flow in bitcoin directly this year (2014) in a massive way!" at the beginning of 2014 but got screwed right?

[NotHatinJustTrollin]

He is right though.  
No money went into btc directly.  When investors truly believe that something such as bitcoin will go up, they buy it directly (ex. look at people buying oil and storing it is ships, they don't care that it hasn't bottomed, they know it will go up because they believe in it.)

Besides, this news caused what, btc to hold at 213 for a day, instead of 208.....woooo were doing so great.  

Let's not be unrealistic here guys, when we hear that these guys are buying btc directly, or even promoting its widespread usage, good.  For now, don't get caught sinking all your money in yet.  

Of course if you already have money sunken in such as myself, we can close our eyes and pretend that this is the turning point...... or we can relax and not set ourselves up for massive panic sales and 9 million trolling threads when the price drops back to $200 or below.  
I want btc to skyrocket of course, but at this point we waited so long, we might as well wait for it to increase because people are actually using it, not because you guys think if you don't jump in now you are going to miss the rally....that is not happening.    

Good post, it's nice to see somebody who is trying to be objective and look at things for what they are.

[NotHatinJustTrollin]

Nobody answered my question tho.


Why should the average Joe buy bitcoin? For what purposes?

Aside from reasons related to drugs or child pr0nz or wild speculation (profitable and easy trading of a volatile asset), who is using BTC? Mostly people who already own bitcoin for these purposes.

Why should the average Joe buy bitcoin and use it as a currency, if he is not interested in the use cases I just mentioned?
I mean, why are you here? Why do you own bitcoin? For speculative purposes amirite?
Me too tbh, to trade it.
Now why should the average Joe give two shits about all that?

-as a store of value? bitcoin is a shitty store of value, you said it yourself in a post recently. And 2014 clearly shows it (a whole year of terror if you hodled like a fool).

-because no fees? Volatility can fuck that over real good, so no point in saving 1-3% when you can lose 10-30% in a few days. You might argue that over time (IF bitcoin succeeds) volatility will gradually decrease. While I have doubts about that, in the long run bitcoin transaction fees will be higher anyway. I guess you know that miners “need to be paid” in order for bitcoin and the blockchain to exist, whether thanks to ridiculous inflation, or transaction fees. The blockchain is not gratis.
Peter Todd said it himself: “regarding fee economics, we’re fucked”.


So why should the average Joe put up with bitcoin’s volatility and the possibility of having his funds easily stolen (if he has to move his money around, you can’t just keep it in cold storage forever you know) and no consumer protection?
Why?


For musical chairs-ponzi speculative purposes or drugs or child pr0nz, that’s why. But guess what, not enough people care about that to justify a high BTC price.


The masterplan for bitcoin’s world adoption and earth domination might not work out as expected I’m afraid…

[tvbcof]

Nobody answered my question tho.

Why should the average Joe buy bitcoin? For what purposes?

Back when Bitcoin was in the low single digits, I argued that the average Joe who could afford to might pick some Bitcoin as a long-shot bet just in case because the pay-off, in the relatively unlikely event that there was one, could be large.

Also for the reasons of reward size, that the actual amount of BTC need not be very large in order to make things pay off in a moderate to good scenario.

At $1000, we were approaching what I considered the 'moderate win' scenario.  I took some profits and re-balanced my portfolio there which was in-line with the plan I made when I was buying.

Different times now.  I'd not make any suggestions at this point.  Personally I would still probably make a modest bet today if I had a strong desire to diversify.

[NotHatinJustTrollin]

Nobody answered my question tho.

Why should the average Joe buy bitcoin? For what purposes?

Back when Bitcoin was in the low single digits, I argued that the average Joe who could afford to might pick some Bitcoin as a long-shot bet just in case because the pay-off, in the relatively unlikely event that there was one, could be large.

Also for the reasons of reward size, that the actual amount of BTC need not be very large in order to make things pay off in a moderate to good scenario.

At $1000, we were approaching what I considered the 'moderate win' scenario.  I took some profits and re-balanced my portfolio there which was in-line with the plan I made when I was buying.

Different times now.  I'd not make any suggestions at this point.  Personally I would still probably make a modest bet today if I had a strong desire to diversify.

That is still "speculative reasons".

The average Joe wants something that is useful, that has a purpose, if the only purpose is "I will get more dollars when I will be able to sell it higher" (IF it goes higher), that is not gonna work to bring "world adoption" to bitcoin.

As I explained, there really isn't any point for the average joe to actually use bitcoin as a currency or as a store of value, aside from illicit activities.
The only real reason seems to be musical-chairs speculation as an end in itself, and that is not exactly something the average joe might know how to do profitably or be interested in in the first place.

[HarmonLi]

Doesn't matter. That money is helping the Bitcoin infrastructure developing and getting better. Sometimes it's only due to bold and adventurous people that something actually turns out to work well. You can't make big gains if there's no risk involved, that's just the way it is!