Teaching An Old Dog New Tricks \ stacker news ~bitcoin

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4720 sats \ 17 comments \ @siggy47 6h bitcoin

The Problem

I was listening to British Hodl the other day. He talked about the older, wealthier guys who need to be convinced to sell some of their real estate and stock portfolios and buy bitcoin.

It may be good advice, but it is very counterintuitive for people who have been investing for 30 or 40 years in an attempt to preserve and grow their wealth.

After the Nixon Shock of 1972, investing part of your income was necessary to keep up with the debasement of the dollar. It was rarely articulated like this. It just became part of the culture for successful people who earned more than they needed.

Armchair Investing

Your average professional or business owner needed to learn wealth preserving techniques : Stocks, bonds, real estate. Investment gurus popped up. Diversification was preached. Rebalancing portfolios prevented any positions from getting too big.

"No one ever went broke selling a winner" was a cliche. This attitude afforded some protection, but few people got rich selling Apple, Amazon, Facebook, etc after a 20 or 30 percent gain. They would have been better off ignoring the gyrations and letting all three ride. That went against conventional wisdom, though.

Once the index funds showed up, everyone was encouraged to buy a little piece of hundreds of stocks in a basket. Great for the market, but difficult for the individual investor to grow wealth beyond the real inflation rate. John Bogle and his vanguard products were the main proponents of this method.

As an investor got older, dividend stocks and annuities were hawked as ways to ensure a retirement income.

To make things worse, the 60/40 stock bond split was pushed as a way to get the average guy to buy "risk free" US treasuries.

Turning Their World Upside Down

Now, these young kids, or not so young mavericks like Saylor or Greg Foss or Fred Kreuger come along and tell these successful, established guys to sell all their assets and buy this 15 year old magic internet money.

It might be the best investment advice they will ever get, but it will seem insane and reckless. That's probably where the FUD "it's a scam /ponzi scheme" comes from.

There needs to be a way to better educate this group. I doubt many of them will liquidate everything and let it all ride on bitcoin.

Who Cares?

I'm sure a bunch of you are thinking "who cares?" Have fun becoming poor.

We'll, first of all, that's cruel. What the hell is wrong with you people?

More selfishly for all of us, these guys are the same ones who WILL start buying a little microstrategy and Larry Fink's ETFs. Self custody will seem unsafe and reckless. These are the people for whom bitcoin will just become another asset in their portfolio. They'll allocate gradually, and listen to their advisors about the prudent percentage to own. Adoption as money? They already have their dollars, and good luck changing their mind.

I'm Pessimistic

I don't have any solutions and I'm worried that this is our future. Our hope lies in the young people, and influencers like Alex Gladstein, Joe Nakamoto, and Anita Poach. I hope we are all ready to engage this battle.

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299 sats \ 6 replies \ @Fiat_Revelation 4h

As you said, this is a battle. Today's zeitgeist makes Bitcoin out to be an investment strategy, maybe in a large part due to Saylor. Most folks think it's a stock/company like Amazon or Apple. Bitcoin as a SoV asset is scrondary, even symptomatic of, the the p2p electronic cash principal.

I've been playing out scenarios in my Mind since @k00b mentioned the Saylorication centralizing SoV argument. My feeling is the MoE use will continue to grow in marginal communities, unabated by the investment portfolio piece, increasing the value of the network. Grass roots.

But HODLers need to not sell their Bitcoin, because the Saylors and the Mircosofts of the world will gobble it up, keep it on their balance sheets and probably never spend it. They won't need to if there isn't a market demand for it as "cash." As long as the majority of Bitcoin stays distributed and whales only hold a fraction of all total Bitcoin, then I think MoE Bitcoin as money proposition has a chance to play out. Alternatively, if large corporations are able to hold most the UTXO's in the long run, then it doesn't give much chance for layer 2s like lightning to thrive because they probably won't initiate these moves. They have their "Almighty USD".

Your skepticism is warranted. It should be an exciting cycle.

101 sats \ 5 replies \ @siggy47 OP 2h

Articles like this show that as bitcoin nears fiat $100k long term holders are selling, and ETFs are scooping up the bitcoin. It's not anyone's business what you do with your own bitcoin, but it's a disturbing trend.

https://cointelegraph.com/news/bitcoin-diamond-hand-sell-off-risks-etf-inflows-98k

43 sats \ 4 replies \ @Fiat_Revelation 2h

Ehn.. this article is kinda click baity.

LTHs are wallets hodling a given amount of BTC for at least 155 days, and correspond to the less speculative end of the Bitcoin investor spectrum.

If long term is less than half a year than that includes a large group who bought in this cycle.

0 sats \ 3 replies \ @siggy47 OP 2h

True. I don't follow this stuff much, but I think I saw headlines that old wallets were making moves. Regardless, any transfer of bitcoin from actual holders to ETFs is a negative IMO.

43 sats \ 2 replies \ @Fiat_Revelation 1h

Agreed. Self custody is the only way. Lyn Alden recently went on Stephan Livera's podcast and explained how people who have self costody have disproportionately more power in consensus matters like forks than the ETF fund managers. There's nuance, but my takeaway was that the legal implications of holding on behalf of their investors complicates and slows their decision making, which is disadvantagous in fork scenarios. Haven't lived through this myself, so not 100% on how it works when theres a protocol change. Recommended listening -- a definite eye opener on 'governance' in the Bitcoin network.

33 sats \ 1 reply \ @siggy47 OP 1h

Yes, I have seen clips of this episode and I want to watch the whole thing. As a practical matter, running your own node will definitely give you an advantage, as was demonstrated during the blocksize war. I was just getting started then so I am not fully versed either, but the book is excellent, in case you haven't read it yet:

https://www.amazon.com/Blocksize-War-controls-Bitcoins-protocol/dp/B08YQMC2WM

43 sats \ 0 replies \ @Fiat_Revelation 7m

Thank for the recommendation. I'll definitely check it out.

Pretty good review over in BooksAndArticles where I see it got Darth's seal of approval. Impressive.

44 sats \ 2 replies \ @realBitcoinDog 2h

Have fun becoming poor

🤣

11 sats \ 1 reply \ @siggy47 OP 2h

I toyed with making a new acronym- HFBP

43 sats \ 0 replies \ @realBitcoinDog 39m

Nice

43 sats \ 0 replies \ @Msd0457890 2h

I agree with you. The big stock market investors are over 40 or 50 years old, most of them have invested in the stock market and other assets and often know nothing about Bitcoin, whereas new investors have already learned about Bitcoin and have diversified their stock markets or their way of investing.

43 sats \ 0 replies \ @Satosora 3h

I dont know. I think real estate will always be a good investment. Not everyones objective in life is to make tons of money, so just investing and growing your wealth is important. Be it bitcoin, gold, or silver. There are many ways to skin a cat. But I also dont agree that we should say have fun staying poor. Educating everyone on bitcoin is important, there will be people who listen, and others that wont. As bitcoin get adopted more, it will be interesting to see how many of them can keep their eyes closed to the subject.

110 sats \ 1 reply \ @TNStacker 5h

Great essay! Your history is solid. However, as a 59 year old with a university degree in Banking and Finance, I am optimistic. I get your pessimism. I just think it results from short-term thinking. We are so fucking early. And compared to other monitary technology, awareness is happening at hypersonic speed. Over the last 20-30 years (Internet age), we became used to rapid tech adoption. Hell, we got rid of book and record stores completely. Wealth and money will come. But it will seem slowly, and then all of a sudden to us.

151 sats \ 0 replies \ @Undisciplined 4h

Likely, we're going to have rapid turnover in which financial gurus are being listened to and that will drive the changes in conventional investment wisdom.

Those going bigger into bitcoin are already making more impressive returns and as their track records get longer, more and more people will listen to them.

64 sats \ 1 reply \ @Bitcoiner1 4h

You can not rely on three small influencers.

All the Bitcoiners has the responsibility to orange pill at least two friends.

43 sats \ 0 replies \ @TNStacker 4h

65 sats \ 0 replies \ @Shugard 4h

I love Gladstein's work! There is great hope!

We can also teach our children, which makes it even more powerful! The bitcoin crowd is multiplying and spreading the knowledge about the fiat problem and inflation.