Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Bitcoins to Stabilize Retirement.
Old 07-11-2016, 01:13 PM   #1
Recycles dryer sheets
 
Join Date: Jun 2014
Posts: 96
Bitcoins to Stabilize Retirement.

That somebody would suggest this completely floored me:

Will Bitcoin Be the Leg That Stabilizes a Failing Retirement System?

I don't buy this whole '401k is failing us' line when the problem is not saving. Seems almost criminal to suggest people invest in bitcoins.
__________________

__________________
Neill is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-11-2016, 02:09 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,086
I remember watching Bitcoin at $13 but could not figure out how to actually buy them. Now they are $650.
__________________

__________________
jim584672 is offline   Reply With Quote
Bitcoins to Stabilize Retirement.
Old 07-11-2016, 02:38 PM   #3
Thinks s/he gets paid by the post
 
Join Date: May 2014
Posts: 3,140
Bitcoins to Stabilize Retirement.

Huh. I'm confident that my investment in Beanie Babies will stabilize my returns in retirement better than Bitcoin. ;-)

Seriously- I've always believed you shouldn't Invest in stuff you don't understand and that rule has served me well. I just don't "get" Bitcoin so I can't really understand its potential risks vs. rewards.
__________________
athena53 is offline   Reply With Quote
Old 07-11-2016, 03:07 PM   #4
Full time employment: Posting here.
gcgang's Avatar
 
Join Date: Sep 2012
Posts: 947
It's almost criminal what the Central Banks of the world are doing to "real" currencies. Who would've believed Negative interest rates?

From my limited understanding, an attraction of Bitcoin is that, similar to gold, the supply cannot be manipulated like "real" currencies can, but it's in digital form.

Gold/Bitcoin seem like high volatility ways to diversify your cash holdings.
__________________
In theory, there's no difference between theory and practice. In practice, there is. YB
gcgang is online now   Reply With Quote
Old 07-11-2016, 03:13 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Apr 2013
Posts: 5,816
Quote:
Originally Posted by gcgang View Post


Snip..

From my limited understanding, an attraction of Bitcoin is that, similar to gold, the supply cannot be manipulated like "real" currencies can, but it's in digital form.
So digital things are safe and no one can break the algorithm.

I say that and realize our future is based on dollars that exist only by the presence of zeros and ones on several mainframe computers.
__________________
MRG is offline   Reply With Quote
Old 07-11-2016, 04:01 PM   #6
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,217
Bitcoin is a very dangerous place to put your money in. Huge tail risk, impossible to predict what will happen.

I've been following it since late 2012, have owned it and sold it, and looked into the underlying principles fairly deeply.

There are multiple vulnerable points, just two that are overlooked easily:
  • The central community developing bitcoin is fairly small. Think the federal reserve consisting of a few key programmers.
  • Although the system is distributed, in practice the ownership of the key resources (miner pools) are concentrated. If anyone gets control of 50%, all bets are off. At that point one party basically has the power to authorize double spending, just to give one example. Three pools have >55% already, so can collude if they want too. Oh, and most of the pools are located in China ..
And that's next to the usual suspects of governments stepping in, another coin getting more traction, and the fact that this is not a fiat currency nor a valuable commodity. In addition to plenty of thefts and fraud that has occurred in various places.



Just one quick look at the exchange rate chart and stability is not the word I would use in any sense.


Stick to pieces of stable companies. Like tobacco

[Edit] Not saying you can't get rich with it. It's just an extremely risky speculation.
__________________
Totoro is offline   Reply With Quote
Old 07-11-2016, 04:22 PM   #7
Thinks s/he gets paid by the post
sengsational's Avatar
 
Join Date: Oct 2010
Posts: 3,953
The article sounds like it's throwing the idea out there to expand the base of users into the retirement set. Right now, I'm not sure I like a goodly fraction of bitcoin holders. I certainly don't like everyone with dollars in their pockets either, but at least the bad guys are diluted with everyone else.

I'm not sure how having bitcoins concentrated over 50% in one place would allow double spending. How would concentration affect the blockchain?
__________________
sengsational is offline   Reply With Quote
Old 07-11-2016, 05:09 PM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
easysurfer's Avatar
 
Join Date: Jun 2008
Posts: 8,091
I just checked my calendar. Nope, the day not April 1st. Almost had me fooled .
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
easysurfer is offline   Reply With Quote
Old 07-11-2016, 06:55 PM   #9
Recycles dryer sheets
 
Join Date: Aug 2015
Posts: 341
There are a few problems with Bitcoins: the price looks like ballooned to purchase currently, any computerized based currency could be hacked into and stolen (without FDIC there is no compensation), Government could outlaw it because a wide spread of bitcoins would challenge the US$ use. FDR Gold confiscation paid at $20 per Oz, while within a year they raised Gold price to $35 per Oz, but with bitcoin it may not be the case.
__________________
VFK57 is offline   Reply With Quote
Old 07-12-2016, 12:23 AM   #10
Thinks s/he gets paid by the post
GravitySucks's Avatar
 
Join Date: Feb 2014
Location: Syracuse
Posts: 1,051
Who accepts it for payment? I haven't bought anything where the price was listed in BitCoins.
I remember Silk Road was listed as a major outlet for suppliers accepting bit coins when the Feds / InterPol shut it down, but I wasn't in the market for weapons, drugs, or slaves at the time.
__________________
“No, not rich. I am a poor man with money, which is not the same thing"
GravitySucks is offline   Reply With Quote
Old 07-12-2016, 07:54 AM   #11
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,217
Quote:
Originally Posted by sengsational View Post
I'm not sure how having bitcoins concentrated over 50% in one place would allow double spending. How would concentration affect the blockchain?
Not the bitcoins, but the miners.

Miners are the computers that validate the blockchain transactions. Validation is basically a voting process, where >50% of the votes 'win' in case of disagreement (who sent what to whom).

Roughly how it works: you send a bitcoin to a merchant, announce that to the network. Merchant sends you the goods or services as soon others confirm (typically 4 to 6 others) and agree on the transaction. This is what miners do.

In parallel however you create a separate transaction where you send that same bitcoin somewhere else.

Two different versions of reality are in the world now. Agreeing on which version is 'real' happens by majority voting, to keep the entire blockchain consistent. Since you control the majority of the resources, you have the majority vote.

The merchant loses his bitcoin after losing the majority vote.

Does that make more sense?
__________________
Totoro is offline   Reply With Quote
Old 07-12-2016, 04:50 PM   #12
Thinks s/he gets paid by the post
sengsational's Avatar
 
Join Date: Oct 2010
Posts: 3,953
Yeah. But wouldn't a double transaction destabilize the currency for the guy that has the most to lose? It would all be a part of the public record, so analyzed. The 51% guy would be worth pennies on the bitcoin over night. What would be the motivation?
__________________
sengsational is offline   Reply With Quote
Old 07-13-2016, 12:01 PM   #13
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,217
Depends.

The mining pool can get hacked. Bitcoins can be shorted if the mining pool operator isn't that profitable for a huge one-time gain. A government can seize the assets and force a collapse. A few options.

It's a single point of failure, so it creates a vulnerability. Just like (and even more so than) fiat currencies.
__________________

__________________
Totoro is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Bitcoins in the news again UserRequested Other topics 36 04-30-2013 08:06 AM
Missing Bitcoins mickeyd Other topics 12 06-19-2011 06:25 PM
Challenge: Stabilize the Debt M Paquette FIRE Related Public Policy 88 09-13-2010 06:35 PM

 

 
All times are GMT -6. The time now is 05:29 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.