Bitcoin is known as the very first decentralized digital currency, they’re basically coins that can send through the Internet. 2009 was the year where bitcoin was born. The creator’s name is unknown, however the alias Satoshi Nakamoto was given to this person. Bitcoin accounts cannot be frozen, prerequisites to open them don’t exist, same for limits on bitcoin converter .
Advantages of Bitcoin
Bitcoin transactions are made directly from person to person trough the internet. There’s no need of a bank or clearinghouse to act as the middle man. Thanks to that, the transaction fees are way too much lower, they can be used in all the countries around the world. Every day more merchants are starting to accept them. You can buy anything you want with them. How Bitcoin works. You should explore bitcoin mining. It’s possible to exchange dollars, euros or other currencies to bitcoin. You can buy and sell as it were any other country currency. In order to keep your bitcoins, you have to store them in something called wallets. These wallet are located in your pc, mobile device or in third party websites. Sending bitcoins is very simple. It’s as simple as sending an email. Invest in bitcoin to get great returns.
You can purchase practically anything with bitcoins.Bitcoin Anonymity.When doing a bitcoin transaction, there’s no need to provide the real name of the person. Each one of the bitcoin transactions are recorded is what is known as a public log. This log contains only wallet IDs and not people’s names. so basically each transaction is private. People can buy and sell things without being tracked.
Bitcoin innovation. Bitcoin established a whole new way of innovation. The bitcoin software is all open source, this means anyone can review it. A nowadays fact is that bitcoin is transforming world’s finances similar to how web changed everything about publishing. The concept is brilliant. When everyone has access to the whole bitcoin global market, new ideas appear. Transaction fees reductions is a fact of bitcoin. Accepting bitcoins cost anything, also they’re very easy to setup. Charge backs don’t exist. The bitcoin community will generate additional businesses of all kinds.
What Makes bitcoin converter So Interesting?
Reality CheckIt's “reality check” time - again. Cryptocurrency is not actual money -- it's functional money. We can't just listen to the programmers and anti-capitalist group “We are Anonymous.” Some of these guys/gals are good, some are radicals. It's obvious that the information wars, the misinformation and disinformation campaigns, are in full force. But cryptocurrency is not the perfect “money.” It is not even the perfect “currency” or is it? How about bitcoinI is, however, a near perfect lesson - about how code can substitute for checks. Checks written or debits made or credits obtained -- all based upon fiat money. The problem or perhaps the next step, will be when cryptocurrency itself retains value -- long term. When fiat money is no longer required to support the system of private digital monies. It is going that way now. Digital monies creeping up on ten years of value. So the lesson is that we "the people" can create an encrypted monetary ecosystem which cannot be manipulated. A resilient, person-to-person, fiat e-currency, immune to fickle governments. Immune to us. An irredeemable currency, as it were. Once the block-chain becomes obsolete, however, and that will happen at some point, then the next alternative currency will have been born. And hopefully, it will not owned by the Chinese. Bursting Bubbles?Then there is the supernova theory. A stellar explosion which briefly outshines the entire galaxy, according to Wikipedia. But in this case, the comparison is rather minor, because bitcoin has not yet fully shined. If one looks at bitcoin's past, this stage may have occurred already, when the value exceeded, very briefly, over $1200 dollars each. Like a supernova, bitcoin's energy was expelled for a brief period of time and we are now watching as the residual bitcoin energy fades into oblivion...or are we? So here we go again. Into the great beyond. Perhaps as posited, to over $40,000 a coin? Is this just a maturation stage? A waiting period. A minor plateau on way to Mt. Everest, before we strap on our oxygen bottles and head for nose bleed territory? OutlookMonday, August 24, 2015, marked the beginning of the upward tick for Bitcoin, but only a tick. From the $200 range bitcoins pushed to $500 each. Then they slipped back to lower territory – again. As of this update (April 28, 2017) the upward pattern or revaluation is holding above $1000 (U.S.). Above $1300, actually. It has exceeded that psychological barrier: gold. This pattern is not like a stock, but it is similar. Monero began its serious climb after August of 2016. They currently trade for over $20.00 each. DASH, long bashed by the alleged purists of cryptocurrency, has steadily risen in value. It currently trades at over $70.00 each. DASH's latest upturn began in January of 2016. A year long uptrend, once exceeding over $100, per coin. Company stocks can rise in value and then fade, but the underlying substance, at least for some types of stocks, are voting rights in that company. Note, however, that many stocks and bonds are parceled out in the form of mutual funds or ETF's, where the voting rights remain with the investment houses. Individual investors – you and me – just hope to earn a tidy profit in 20 or 30 years. In Dash, there is a voting system. Not in Monero or Bitcoin, however. Not exactly. We are told that companies mature and their stocks stabilize in value – or grow slowly. We are told to look for that slow and sure growth. Dash? We are told to ignore the fact that the dollar is devaluing and all the American companies, along with it. At least the ones that remain in America. The companies that flee are chased by Uncle Sam, as he tries ever so gently, to shove worthless fiat bills down their throats. We are told not to worry about the "helicopter money." Is Ancient Rome an example? SpeculationSpeculation about the next great 'Bitcoin Bubble' is all over the blogs. Each time Bitcoin gathers a head of steam, the pundits climb on board the train and argue with each other. The Bulls and Bears cheer and jeer, respectively. Will Bitcoins reach $40,000 each? According to some they will go higher. Others cite the supernova scenario. What of a stable value? What of blocksize? Slow transactions? The Chinese? Litecoin? Ripple? The “Gold Bugs bash Bitcoin as just another fiat currency. They have a valid point, but they also forget the value of the blockchain accounting system. Why can't such a system be used to verify ownership of assets? Actually, this has already been accomplished, but not in a big way. Other IssuesEthereum is one such an example. They could issue company stocks on their “blockchain.” Now just imagine for a moment, if their “blockchain” forks? (For the lay person this means that their software just failed and this still occurs within these types of systems.) What happens to your stock? Ethereum has had its share of problems. Manipulation of offshoots, what some call side-chains, to move (not steal) coins. One can use Ethereum Classic instead. Gold Bugs don't need to worry about “forks” just confiscation by governments and thieves. The terms “governments” and “thieves” are often interchangeable, of course. The government fiat-currency buffs are the biggest hurdle to innovations like bitcoin. They begin their morning prayers to John Maynard Keynes, the dead economist responsible for the fiat based currency system we presently use. They fill us with 'concerns' that these new technologies can compromise banking systems. And they, the investigative arms of nations, do have valid points -- as they apply to state run, state controlled, banking systems. But, crypto is private. I might add that many of us feel we use the current government fiat currencies, involuntarily, i.e., fiscal-slavery-lite. No Father?Bitcoin has no father, as some have put it. It is like gold, a physical thing, in that respect, but it is not physical. We know there is about 363,762,732 pounds of gold on earth, at last count, according to Google - on November 9, 2015. We know about how many Bitcoins will be “mined.” About 21,000,000 give or take. But the similarities end there. Will this next Bitcoin surge cause the entire ecosystem to burst like an over-inflated fiat currency or will the world finally stand up and take notice? Could Bitcoin implode, like some fantastical singularity – an intelligent one as some worry - leaving not a trace of itself and millions of “Bag Holders” staring into space-time? Some Bitcoiners will even tell you that money is 'time' and Bitcoin is analogous to a big clock. To be...To optimists, pouring millions of dollars into bitcoin, this is proof positive of its stability. Not to mention yen, yuan, pounds, and various other fiat currencies flowing in. If the current influx of fiat monies continues its pace, Bitcoin will continue to exchange over a billion dollars each week. To the average international bank, this is peanuts. But these exchanges are taking place over automated and decentralized systems (software) anybody can download and use...or not download, but still use. That makes all the difference. Virtually no 'overhead.' Streamlined. Efficient in a lot of ways. But is is very slow when compared to the current financial systems. Ten minutes? Two hours? Just how long does a transaction really take? Say no to the "Download"Downloading is another problem. Nobody is in charge of the Bitcoin Software. A group – a community of sorts – must come together to “update” the software. Then we, the users, must either swallow the “update” or move on. And the software is slow to load the blockchain. It takes days... In other words, human cooperation becomes the new “gold standard.” Interesting, isn't it? Unless...like what is happening currently, one nation assumes control. China, for example. Five ReasonsThere are five good reasons Cryptocurrency will continue to surge - worldwide: Over-Regulation: Countries are making crypto illegal or over-regulating it. When things become illegal, supplies constrict and millions of people who wish to keep using or buying the thing cause the price to elevate. Excessive Debt: Countries are mired in enormous amounts of debt – and we don't trust their currencies. We don't know when the next country will go bankrupt. Once they do, the contagion spreads. Fiat-currencies devalue. Prices rise. The countries then 'pump' more fiats into the ever failing Keynesian Model. Current Weakness of Gold(?): Valuable or other base metals are not performing as well as they could be, owing to the economic slowdown and manipulation. As industry slows, the economy is obviously on the skids. Gold, silver, copper have all experienced unusual drops in value. Historically, it appears to be an inverse bubble. When compared to the underlying fiat-currencies, gold and silver should be much higher. Many gold bugs and sound money theorists place the blame squarely upon the misplaced trust in the dollar. Also – a misplaced trust in cryptocurrency. Once the people realize their error, as the sound money supporters state, gold will seek its rightful and high price, relative to a failing fiat-currencies – they hope. (Or are we in some new monetary paradigm?) Confiscation: Gold can and has been confiscated by governments. This is crux of the “Gold Problem.” In short, sound money theorists cite gold's long history of hard value. They rarely bring up the fact that when gold re-values and currencies crash, governments react by confiscating the gold and reissuing fiat-currencies. Gold is also heavy, must be insured, and cannot be transferred online in the U.S.A. (Bitgold -- now GoldMoney, the company, has solved this problem in Canada. But it is not a decentralized blockchain. It's just another method to invest in gold.) Privatization: Private currencies are very difficult to steal. Governments can't make “private” currency or necessarily confiscate it. The fact that governments cannot control the number of fiat-Bitcoins being issued (mined), traded, and transferred, is a deal-breaker when it comes to the adoption of private-cryptos. Monero and DASH are the primary players in this area. Zcash is attempting to play, but is struggling. The fact that people, the world over, trust cryptocurrency certainly bothers many governments. Governments, most of them, need to retain their ability to 'make' currency – since most don't really make 'money.' If the value of cryptocurrency advances, then how will this change government-fiat currencies? Will they devalue, if crypto becomes a household word? No doubt. Over-regulation is a key factor. The more government entities attempt to curtail innovation, that less innovation there will be. Cryptocurrency is innovation. That's why governments are imitating the “blockchain” software. Nobody (okay – almost nobody) trusts government, however. Government investigations and the general economic malaise worldwide, are other examples recent cyptocurrency investment disinterest. Why jump into a quagmire of rules, regulations, ad infinitum, unless the profit potential outweighs the risk? Cash or dollars are easier to use, but far less private. Maybe the Chinese are fleeing their monetary system in droves, but should other countries follow suit? Perhaps the biggest hurdle, given all of the bad press, however, is trust. Specifically, cryptocurrency trust. The “fear factor” is alive and well within the "crypto-sphere." This is a sobering fact. If and when Bitcoin goes “Supernova” is the big question. An expanding ecosystem, where a Bitcoin fiat currency valuates too quickly, could lead to such a phenomena – just as it does in nature. Bitcoin is unstable. Instability does not last in nature. Neither do good intentions. But...shall we say "In Crypto We Trust" ???
Online Bitcoin Trading: Discover The Keys To Earning A Formidable Income Trading Bitcoin
#News 12 September 2017: The Smart Token Exchange pre-sale is live. They plan to aggregate exchanges’ liquidity reducing liquidity cost (also known as slippage) to traders. The key is fast API execution, in which they are world-class with their KeyCaptcha business. This project is under the radar but will gain traction. I have invested in the STEX Pre-Sale. (The terms are much better than in the ICO that will follow.)
#News 10 September 2017: I just published Are you in the Bitcoin 1% ?
#News 9 September 2017: PreSearch is a decentralized Google. This will happen. ICO is live.
#News 26 August 2017: This essay is top of the Google Search for crypos. Please clap for this essay if you are passionate about crypto. I tweet about crypto trading: BambouClub .
#News 26 August 2017: I keep a crypto trading diary that I regularly update with trading recommendations.
The Ten Rules
15 September 2017: Performance of my Portfolio:
Since Entry June 2014: Portfolio is x12.4, i.e. has increased 1,140%. My average Bitcoin buy price (June 2014 to December 2015) was $540. Bitcoin (at its current $3,709) is x6.86, increase of 586%.
Year to Date (YTD) 2017: My portfolio is x5.8, i.e. has increased 480%. Global Cryptomarket is x6.89, increase of 589%. (From $17.7 billion to $122 billion.) The main successes in my portfolio have been $BTC, $ETH, $EOS (ICO), $XTZ (Tezos ICO), $ZRX (0X ICO), $NEO and $BNB (Binance Coin). These calculations apply to my trading portfolio, and exclude my pension which has been fully invested in a Bitcoin fund since June 2017.
These notes are mainly for my own benefit so I can refer back to them and improve them. I will update it from time to time.
- Build the Portfolio on Bitcoin
- ‘When you See it, Bet Big.’ George Soros
- Index Track the Top 10 Cryptoassets
- Scale Out (Take some Profits)
- The Honeybadger Trade: Buy the Dip
- Do not Over-Trade. Lock up Coins
- Let Profits Run. Cut Losses. Watch 7d Price Change not 24h or 1h
- ICOs are a Great Opportunity. Do Your Own Research.
- Research Micro-Caps that might rise by Orders of Magnitude. (I like EquiTrader $EQT, only available at CoinExchange.)
- Leveraging has a Role. Buy (and Sell) Bitcoin Futures at Bitmex Exchange. Use Futures if you want greater, faster returns (at a higher risk).
Rule 1: Build the Portfolio on Bitcoin
Bitcoin is the mother lode. It has been good to me and will always form the main part of my crypto portfolio.
Those (mainly low-income copy & paste journalists) claiming Bitcoin is in a bubble are too lazy and/or stupid to become informed. There is no Bitcoin bubble for these reasons.
Bitcoin has had phenomenal growth in its price and MCap since inception. If we exclude other cryptoassets, Bitcoin has been the best performing asset in the world every year since 2009 through to June 2017 with the exception of 2014. It has beaten all global currencies, equities, commodities, bonds, ETFs, real estate throughout that period. Bubbles are by definition short-lived, they do not keep bubbling for eight years.
As a result it has achieved a MCap of $56 billion and this place in a global table of iconic assets.
Volumes indicate the liquidity of an asset. The greater the liquidity the easier it is to buy and sell, even when there is turmoil, and the lower the Bid-Offer spread and therefore the cost of trading. You want to avoid assets with tiny liquidity as when the shit hits the fan it will be costly to exit. Bitcoin has world-class liquidity. I run a crypoasset analysis site named Blocklink.info. Here is a screen-grab of the most liquid assets in the world.
Source: Blocklink.info. Volumes for cryptoassets are fetched from the Coinmarketcap API using the CRYPTOFINANCE Google Sheets Add-On. Volumes for stocks come from Google Finance. You can check the US stocks volume at the NASDAQ site.
Bitcoin’s trading volume is up there with the great iconic American stocks.
Bitcoin’s price will continue to be volatile, but Bitcoin is travelling along a secular bull trend road, and that spectacular volume is not going to evaporate overnight.
Every month fees are ever higher which is watertight evidence of ever greater demand to use Bitcoin. That is, people want to send transactions across the blockchain, not just trade on the exchanges.
Tx fees time-series data is maintained at Blockchair.com
Bitcoin and My Portfolio
Bitcoin holds a dominant place in my cryptoasset portfolio. As a result of recent changes in UK regulations I have allocated my entire personal pension (like a US 401k or retirement account) into Bitcoin via the XBTProvider ETN.
Be more cautious about investing your 401k into Barry Silbert’s Bitcoin Investment Trust $GBTC. The (European) XBT Provider ETN is an open-ended fund which means it maintains a premium to the NAV close to 0% at all times. The Bitcoin Investment Trust is an inferior investment vehicle because it is a closed-end fund (it does not increase its holdings of the underlying asset when demand for the product increases) which means it is subject to wild swings in its premium, which has been as high as 150%. So you could make the mistake of buying when the premium is high and suffer swingeing losses even when the Bitcoin price is stable.
Rule 2: “When you See it, Bet Big.” George Soros.
Something extraordinary is happening. The cypto space in June 2017 is like the Internet space in 1995. It is a great opportunity.
Stanley Druckenmiller has written about his dealings with George Soros whom he quotes as saying ‘When you see it, bet big’. The funny thing is, I was mocked by a Hedge Funder on Twitter named Sarah Cone (@impcapital ) when I revealed that I had seen it and I had bet big. I bet big with my entire fucking pension.
George Soros: When you see it, bet big.
Here is Charlie Munger expressing a similar though:
Rule 3: Index Track the Top 10 Cryptoassets
Until 18 May 2017 I held very little Ethereum and zero Ripple in my portfolio.
I made a great mistake in not buying Ethereum and Ripple in 2017 until 18 May. My mistake was Bitcoin Maximilism. I refused to have anything to do with Ethereum and Ripple because I didn’t like them. As a result I missed these returns.
I came to my senses on 18 May, 2017 when I underwent an epiphany. I then made a new (self-imposed) rule : broadly track the Top 10 cryptoassets in my portfolio, regardless of my opinion about their individual merits.
I have applied a flexible, discretionary form of index-tracking since then.
I execute index-tracking manually off this Google Sheet:
At the time of writing, 20 June 2017, the results of index-tracking have been pleasing.
YTD 2017 returns for Cryptocurrencies, 18 May 2017:
My portfolio was up 106% YTD.
YTD 2017 returns for Cryptocurrencies, 20 June 2017:
My portfolio was up 281%. So in one month (18 May to 20 June) it has raced past Bitcoin, $GBTC, and Monero, and has made good ground in catching up with Global Cryptocurrencies.
I ruled myself free to apply discretion in my index-tracking. It was very clear early on that Ripple was in a secular bear market against Bitcoin from 18 May and I quickly became and stayed underweight in Ripple.
I also went underweight in Ethereum in mid-June at $350 — $360.
Is Ethereum in a bubble?
I don’t know. Applying the same metrics used above to $ETH it does pretty well, but not as well as Bitcoin. But there are clear risks and as a result I am underweight in Ethereum compared to its share of the global Cryptoasset Market Cap.
Growth (Price & MCap): Ethereum has outstanding growth in its short life, but it was only created in August 2015 so it lacks the 8-year track record of Bitcoin. This is significant. Ethereum’s explosive performance in 2017 could indeed fit into the time-frame of a bubble.
Trading Volumes & Volume/MCap Ratio: Great. Similar to Bitcoin.
Transaction Fees: All good. They are rising quickly indicating true demand for this cryptoasset.
Metrics aside, Spencer Bogart makes great sense in this thread where he describes the regulatory risk and other risks that might bring the Ethereum house of cards down. It is possible that the SEC will rule that the ICOs are illegal sale of securities. People might go to prison. It is for these reasons that I am under-allocated.
Note: If Governments decide to put a stop to the cryptoasset economy, there is a crucial distinction between Bitcoin and Ethereum. Bitcoin is truly decentralised. It has honeybadger, even cockroach qualities and is resistant to such measures. Ethereum is a registered commercial legal entity in Switzerland and can be shut down overnight.
Rule 4: Scale Out (Take Some Profits)
Anyone who has lived through a bubble knows the value of this.
I have experienced several bubbles, namely London housing 1984–1988, DotCom in 1998–2000, London housing again 2002–2008, the Bulgarian property market (seaside apartments and ski apartments) 2004–2008.
It’s human nature to be cautious at first and then progressively relaxed, even reckless. My observations suggest that it is best to behave in the opposite, counter-intuitive way: commit yourself to the market with reckless abandon in the early days, and then start the scaling out process, applying the brakes and get the hell out when it appears to be the later stages.
In all those bubbles I made great paper profits that disappeared in a matter of months. The paper profits were more than 2 million Euros in the Bulgarian property market. In none of them did I take profit off the table in the run-up. Christ did I regret that. I am taking profit off the table in the cryptoasset market.
Finally, at the end, you must scale out completely. Jesse Livermore’s advice for a bull market:
It is not my opinion that we are near the last eighth:
Rule 5: The Honeybadger Trade: Buy the Dip.
Lots of influential actors — Governments, banks, regulators — fear Bitcoin and try to kill it on a regular basis. Bitcoin takes massive hit after massive hit, but it has always rode the punches and bounced back. Experienced traders have noted this and the advice is to buy the dip. This is the Honeybadger Trade.
I like the idea of BTFD, as I truly believe in Bitcoin. BTFD! people on Twitter yell. But it has puzzled me for a while.
There is a solution. Buy on margin at the dips. The beauty of this is that you do not need to add funds to your account, you merely avail yourself of the leverage already available. Use Bitmex Exchange.
I permit myself to use margin in the specific case of BTFD.
You need to get the timing of BTFD right. Beetcoin on Twitter provided this great analysis (thread) demonstrating that you should stay out for the first 48 hours of a dip and then BTFD.
Do NOT Sell the Dip
You need to be clear, is this a dip or is it a secular bear market? I BTFDd relentlessly in the DOTCOM unravelling in 2000 and lost every penny in the end.
If it is an established, secular bear market then face the music and STFD.
Rule 6: Don’t Overtrade. Lock up Coins
I over-trade stupidly at at tiny whims when I am bored or drunk. A solution I have found is to lock coins away out of reach.
One way is to keep Bitcoins and others in your hardware wallet. I use Trezor. It can store Bitcoin, Ethereum (+ all ERC-20 tokens), Ethereum Classic, ZCash, Litecoin, and Dash.
Another way is to lock them into terms deposits at Cryptopia (applies only to Dotcoin). This gives you the added benefit of earning interest on coins at interest rates that just do not exist outside crypto (about 18% p.a.).
Rule 7: Let Profits Run. Cut Losses.
This guy turned $10,000 into $6 million by letting his profits run during the Ethereum run-up in the first half of 2017.
Run profits Cut Losses is hard to do exactly. In my P&L Sheet I focus on the 7d (Price Change over 7 days) to decide whether to re-allocate my portfolio according to this rule. I largely ignore 1 h and even 24 h .
Rule 8. Treat ICOs and other Examples of Herd Mentality with Care
In general you are better off holding Ethereum than going through the mad, greedy, FOMO process of buying ICOs.
But ICOs or coins newly released on the exchanges can be great investments. Beetcoin played the IOTA new release on Bitfinex like a master. He turned 10 Bitcoin into more than 200 Bitcoin. He bought the $IOT Over the Counter (OTC) some time before Bitfinex listed it. He was ahead of the herd.
Rule 9 Do Your Own Research. Examine Micro-Caps.
I respect this strategy.
I bought Elastic $XEL at the obscure Heat exchange. It was rather difficult discovering how to buy it because I was in this case ahead of the herd where the path was not well defined. In the end I bought it at a high price (average 31,367 Satoshis, should have got them at 25,000 Sats) as I got scammed over at Heat by a predator (Arsonic @Ars0nic on Twitter) playing the order book. We’ll see how that plays out. I think the excessive price I paid will not matter too much.
Rule 10 Be Careful as Hell with Leveraging
Obviously leveraging can work, as with the guy referenced above who has made $6 million relentless buy Ethereum on leverage since December 2016.
I take out the rare leveraged position at Bitmex Exchange.
It can also go horribly wrong when margin calls occur across the mass market.
That said, those who lost everything were not the brightest traders. They could have avoided that by using judiciously set Stop-Limit orders, rather than plain Stop orders.
So that is the Ten Rules.
I keep a crypto trading diary that I regularly update with trading recommendations.
If you liked this please click on the Green Heart and follow me on Twitter: @ BambouClub