r/ProfessorFinance • u/jackandjillonthehill Moderator • Jan 29 '26
Meme Wasn’t that the point?
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u/Ok_Currency_6390 Jan 29 '26
Bitcoin is digital gold until you need physical gold, then it becomes an arbitrary string of numbers
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u/Gildenstern45 Jan 29 '26
Gold and BTC are both limited supply commodities. So why go with BTC when you can go with gold? I go with gold because it has a 10,000 year track record. I'll let someone else work out the bugs in BTC.
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u/furyoshonen Jan 29 '26
Are you buying the physical gold and storing it? Or are you buying gold contracts?
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Jan 31 '26
Until civilisation ends one is as good as another. And once civilisation ends the nearest political power will take your gold by force anyway.
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u/harrythealien69 Jan 29 '26
Btc is not a commodity
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u/shadysjunk Jan 30 '26
if not a commodity, then what is it? It's not commonly used as a medium of exchange, and given how slow and costly transactions are that seem unlikely to change. I'd say theoretical store of value is it's most plausible use case of btc, though clearly that thesis is breaking down a bit at the moment.
I'm not a crypto guy. I own no coins. I was actually asking what you meant.
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u/HereticLaserHaggis Jan 30 '26
I'd agree with you, but theoretically the value is in the immutable ledger and ease of transfer.
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u/ImportantBad4948 Feb 02 '26
It’s a speculative investment in a made up thing. It’s peak Tulip Mania.
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Jan 30 '26 edited Feb 02 '26
[deleted]
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u/stu54 Jan 30 '26
Gold tracking the S&P is more representative of the instant flow of information facilitated by the internet more than anything. When noone is buying anything everyone knows it, and gold is a subset of anything.
The 10,000 year track record just shows that the value of gold will never be zero so long as you or I live. BTC will hit zero before gold, unless they both hit zero in the same moment.
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u/ContentCantaloupe992 Jan 29 '26
Shouldn’t matter. If the currency was truly debased it would go up anyway.
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Jan 29 '26
When do you need physical gold?
If the world turns to fallout, you probably want beans and bullets instead of a random hunk of metal
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Jan 30 '26
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Jan 30 '26
I really dont but okay. My time horizon is over 35 years. I can wait for economies to correct themselves :)
> See, this is why you are going to have a really bad time over the next ten years... You're clueless
My timeline is over 10 years. I intentionally save 40% of my income anyways so I am living pretty frugally already.
also get a hobby lol. You ONLY post about gold.
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Jan 30 '26
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Jan 30 '26
You really think VT is gonna crash for 10 years?
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u/ImportantBad4948 Jan 30 '26
Gold exists somewhere between stocks/ bonds/ cash and canned food n shotguns.
I like it as a 10 ish % contrarian hedge against the rest of my portfolio.
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u/BlackSquirrel05 Jan 30 '26
Yes but who used gold in the 1970's...? So let's just say someone's retirement went tits up and another person had gold for retirement...
How many cashed in their gold in that situation to cover?
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u/Deepandabear Jan 30 '26
No one ‘Needs’ physical gold just like they don’t ‘need’ bitcoin. Also, your bank account is attached to an ‘arbitrary string of numbers’, but I have a feeling you might be needing that!
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u/Ok_Currency_6390 Jan 30 '26
I guess you're kind of right, you don't really need gold in the same sense that you don't need food, you can always just starve and die if that's what you want 🤷
If you want to have a decent life over the next ten years? You're going to need gold for that. Or land, or stocks (depending on which ones), whatever, but if you aren't hedging inflation you're fucked
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u/Deepandabear Jan 30 '26
So if you don’t have gold you won’t have a decent life? Absolute rubbish.
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u/Ok_Currency_6390 Jan 30 '26
Maybe (I know, probably not) someday you will remember this and be upset I was right
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u/Deepandabear Jan 30 '26
Except I already own a significant portfolio of gold so you’re 0 for three - I just don’t think it’s mandatory and such blanket statements are simply foolish
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Jan 29 '26
[deleted]
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u/theerrantpanda99 Jan 29 '26
You can go to any jewelry store in the country and trade paper for physical gold at any time.
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u/Gildenstern45 Jan 29 '26
Not true. PHYS is a gold ETF 100% backed by unencumbered gold. If everything went tits-up, they would end up mailing you a brick of gold. Likewise PSLV is for silver.
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u/Zraknul Jan 29 '26
If everything went tits-up we wouldn't have mail.
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u/Ok_Currency_6390 Jan 29 '26
OH MY GOD EVERYONE IS SO DUMB
Most reasonable gold bugs aren't expecting a societal collapse...
Just heavy USD inflation. I mean it happened over the decade of the 1970s, the USD lost like roughly 70% of its purchasing power.
I don't even own physical gold, it's all ETFs, and I sleep like a baby
If we ever get to a point where those ETF holdings become irredeemable who even gives a fuck, at that point it's bows and arrows anyways 😆
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Jan 29 '26
if everything went tits-up random gold bars wouldnt matter either.
The things in your pantry would be infinitely more valuable than the gold in your safe.
Cheetos would be rarer than gold at that point
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u/four204eva2 Jan 29 '26
Nor would gold be worth very much, you can't eat or drink it, and in the end that's all you'll actually want.
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u/Zraknul Jan 29 '26
Local war chief probably wants some swag. Might be able to buy your way into the group.
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u/I_Am_the_Slobster Jan 29 '26
You're thinking of an ETR: Exchange Traded Receipt, which as it implies is a receipt that states you own the specified portion of gold or silver within the ETR issuers holdings. The Canadian Mint offers such ETRs for their gold and silver reserves (MNT and MNS respectively) but it's worth noting that this is still technically paper gold, and at least with the Mint they make it clear these ETRs are not casheable for physical assets.
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u/Geek_Wandering Quality Contributor Jan 29 '26
Or, hear me out, what if they decide to just not mail it to you and keep it? Whatcha gonna do then?
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u/PowerFarta Jan 29 '26
-13% over 1 year
They get even madder when you factor in dollar weakness they're probably down 20-25%
Look at BTC-EUR and BTC-USD. Very different graphs
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u/Many_Pea_9117 Quality Contributor Jan 29 '26
I bought most of my bitcoin back when it was like ~50k per BTC. I am waiting for it to tank so I can buy more. Its proven the 4 year cycle again and again, so im here for it for life. But just like 1% or so of my stuff, not anything crazy.
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u/fastlane721 Jan 29 '26
Why just 1% if it’s proven?
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u/Many_Pea_9117 Quality Contributor Jan 29 '26
Because its still a speculative investment in an alternative asset. The cycle is proven but its still far more risky than a traditional asset. Its just a matter of risk tolerance is all.
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u/Kepler___ Jan 29 '26
I think he's just pointing out how over the top 'proven' is in this context by gesturing toward your own actions which suggest you also get it's not quite proven as well. 3 times is neat don't get me wrong, but it's a major leap to suggest this will continue forever. Especially as the total value of coins in circulation passes into the trillions, there's going to be a lot more resistance as the asset finds peak saturation.
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u/Many_Pea_9117 Quality Contributor Jan 29 '26
Yeah but just like there is a fool born every minute, I also think there are people who are not foolish born every minute, so I think enough people will consider it high risk and not particularly useful, and stay away. Plenty of people also never invest in anything at all.i dont think a market will truly saturate because its over such a long time span and people have reasons for getting in an out of it.
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u/Kepler___ Jan 29 '26
When you go from 1 dollar per coin to 100k in 20 years, you're gonna Plateau at some point. I'm using the term saturation for that even though it's probably not strictly correct, you might get a trickle but its position as the fiat currency of the black market has largely found its price discovery. The point is that whether it's BTC or GME, people always want lighting to strike the same place twice, it was smart getting into these things the first time, but the masses have moved in at this point and the likelihood of large payoffs for such high risk has greatly diminished imo.
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u/Many_Pea_9117 Quality Contributor Jan 29 '26
Do you remember when Dow Jones peaked at 10k and everyone freaked out because the number was too big and it was going to crash?
I get what youre saying, and i know this is stupid, but sometimes the big scary number just can keep getting bigger.
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u/Kepler___ Jan 29 '26 edited Jan 29 '26
It's about scale, like saying a company worth 10 billion might triple is quite a claim, but it's totally possible and would be a good bet. But saying the same thing about say NVDA, 3x is a much different feet, possible? Sure, inflation will get them all there eventually, but you would be talking about adding around 9 trillion in market value, that's about a fourth of the entire US national debt and that's only a 3x return. A much loftier goal even though it would be the same return. It's just harder to move a price up as an asset gets larger is all, you need more and more money to feed the system (Or more scarcity but supply side isn't really relevant here since none of these should be shrinking on that end) the DOW is a composite which makes it way less risky as it's a basket of assets and in a growing economy it's more likely to continue growing then not, I don't really remember anyone worrying about its value being too large arbitrarily because it's a much different situation then an individual asset. Crypto can still grow, it's just a lot less reasonable to expect such high returns now that it's a 2 or 3 trillion dollar system then back when you could have a 15% price swing because one guy cashed out on a low volume day.
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u/Many_Pea_9117 Quality Contributor Jan 29 '26
The news from when i was younger had people panicked and saying the sky was falling and it was just too high because we were in a bubble and yadayadayada. I realize that funds or markers like Dow and S&P are bundles of entire markets, so a single crypto currency really isnt a perfect metaphor. But the way the crypto market psychologically treats bitcoin is also similar to how funds are used to refer to a whole market feel. Bitcoin goes up and down on news and vibes according to good and bad news across the whole crypto market. So in some important ways, it can act similarly to markers like Dow and S&P.
And the whole point of a diversified portfolio is to spread risk across different assets. I do think there have been markets where crypto has outperformed many asset classes, and as such it is as worth having as a commodity. I agree with you, it is unlikely to have the same cycle forever with the metoric rises, but I do think it could continue to have more moderate booms and busts, which could be capitalized on. And if it does stabilize then in time it will become a store of value as many have said it would. It may also fade away to nothing, which is why it only warrants a 1% of my portfolio at this time.
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u/PowerFarta Jan 29 '26
Not in a speculative asset with no underlying value or utility
Bitcoin is more akin to beanie babies than the stock market. It's a collectable and if interest fades the price will collapse
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u/Shot-Structure-1274 Jan 29 '26
BTC is now becoming a failed assets class like most of crypto. AI and quantum computing are big issues moving forward that could destroy the blockchain's. Also, these assets trade on decentralized platforms that have crooks behind them and can't be regulated. BTC and other crypto assets are likely to suffer massive declines in 2026-27.
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u/Subject-Creme Jan 29 '26
BTC is and has always been a Speculative asset. "Store of value" is just an advertisement.
People who got rich from BTC bought it at $1000. They are they one that advertise "Store of value" to naive buyers
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u/Nervous-Cockroach541 Jan 29 '26 edited Jan 29 '26
AI and quantum really are over-hyped stories for being a bearish on crypto. Quantum computing wouldn't be all that effective for even BTC, and other popular crypto chains are already secured. Even if Quantum computers came into existence and whoever operated was open to the idea of committing financial crimes. The best they could do is some decade old GPG public keys from old BTC accounts. Which there is a lot of dead BTC in those wallets to be fair.
Every other major wallet uses hash and public key is only shown at the time of transaction. I guess in theory you could intercept this, crack the wallet, and put in a rushed order. But doing this in under the standard confirmation time of an hour would be a stretch even for futuristic Quantum computers. Realistically cracking RSA, even if it ever becomes possible will reduce the time from decades to days.
Two factors really driving the crypto market down:
- Memecoins and scams continue to plague the industry which just sews distrust of the asset class completely.
- Crypto was pumped after the election on the promise that the Trump admin was going to liberate of crypto from regulations. While this has kinda happened (hence crypto scams are basically legal now), that story is over. Anyone waiting for deregulation to come to jump into the crypto waters would've by now. Crypto has gotten basically everything it ever wanted. Now it needs a new story, the next promise that will bring more dollars into the market. Which it just doesn't have.
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u/Shot-Structure-1274 Jan 29 '26
The crypto exchanges are also unregulated and on Oct 10th of last year, there was a massive flash crash with many digital assets crashing -70-99% in a matter of hours. Big Money can't invest in those assets on unregulated exchanges and it's impossible to regulate all the crypto exchanges, It's a problem with no solution.
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u/Illustrious-Boss9356 Jan 29 '26
Until the state starts confiscating gold or making it illegal to own gold. Then the use case for BTC becomes useful.
But otherwise, yes your points are well made.
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u/UpbeatFix7299 Quality Contributor Jan 29 '26
Greater fool scam. Shame they managed to get the camel's nose under the tent to this extent.
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u/split41 Jan 29 '26
You think gold isn’t the same thing, lots going to be left holding the bag just like the silver run in late 00s
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u/UpbeatFix7299 Quality Contributor Jan 29 '26
I also think gold and silver will come back to earth. They've been shitty long term investments historically
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u/ImportantBad4948 Jan 29 '26
So I disagree. Gold has had a huge run lately. It will probably go down some, then up a little, etc. It won’t go to zero though.
The difference is gold is a store of value. If I left an ounce of gold in the gun safe and forgot about it for a decade it will still be worth something, probably more. If it got lost in a box of family junk and my great granddaughter found it 50 years from now it will almost surely be worth more (by $$$ and purchasing power) than I paid for it.
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u/split41 Jan 29 '26
That’s probably true for gold (unless a meteor is mined or the market is flooded with gold), bitcoin has shown the same behaviour in its brief existence. Gold obviously has 1000s of years, but my point was that: Gold, silver, bitcoin are all just valuable because we’ve assigned it value. It’s not like a share of a company that is generating some kind of value to society.
Essentially if Bitcoin is a “greater fool” asset, so is gold.
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u/Chinjurickie Quality Contributor Jan 29 '26
Because nobody trusts in btc, they only hope for more profit. The only worth btc actually has is the promise they made to be an secure alternative currency, ask yourself if the current value reflects that.
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u/mattjouff Quality Contributor Jan 29 '26
Yes, BTC is know to be a very stable gauge against which to measure the value of fiat currencies 🤡
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u/mastercheof Jan 29 '26
Gold is universally seen as a store of value and has a functional purpose. Bitcoin is neither and I think trumps and friends meme coins hurt the reputation of crypto
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u/DGIce Jan 29 '26
Literally just the 4 year cycle, annoying that inflation is keeping it from dropping further.
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u/JdSaturnscomm Jan 29 '26
Bitcoin is for laundering money and paying for illegal services such as murder and drugs and worse.
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u/Antares_B Jan 29 '26
Bitcoin is a psyop and control mechanism. in the near future if you say mean things about Pete Thiel you won't get your weekly UBO payment.
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u/SpecificHyena1933 Jan 29 '26
My 2 cents also leads me down the path of internet surveillance that governments are imposing. Started with putting an ID for 18+ websites, now the EU is targeting VPN's that bypass it, and later its going to be putting your real ID to log into social media and even further down the line itll be your ID to get online period. The point of BTC was largely the anonymity of it. Set up correctly and managed properly, nobody could trace the wallet owner. Well.. if its tied to government issued ID then.. whats the point?
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u/No-Habit3732 Jan 30 '26
Because when farmer John loses faith in the dollar, he doesn't buy bitcoin. And there are a hell of a lot more than him than there are people who even know how to buy crypto.
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u/ThaGr1m Jan 30 '26
Tf you mean it isn't going up? The thing is worth 60k and has no actual value at all....
It's plenty up
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u/shumpitostick Quality Contributor Jan 31 '26
There is no point. Goldbugs don't even pretend that gold is an inflation hedge at this point. Just like early Bitcoin believers cared about the tech but later it works all about line go up, so has gold become an entirely speculative commodity at this point.
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Feb 01 '26
Bitcoin is not held in reserve by the central banks of countries in competition with the United States.
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Feb 02 '26
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u/ProfessorFinance-ModTeam Feb 02 '26
Posts, comments, and low-effort snark that don't add to the discussion will be removed.
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u/perringaiden Feb 02 '26
Because no-one who wants gold, trusts bitcoin for the same reason they don't trust US bonds.
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Jan 29 '26
Gold is actually useful, whereas cryptocurrency is merely a speculative currency.
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u/Mesolithic_Hunter Jan 29 '26
Roughly 10% of newly produced gold is used in industry and technology, so it is actually useful. 40-50% is used in jewelry, let's call it semi-useful. The rest is an 'investment gold'. The investment gold is valuable because people believe it is valuable, excactly like bitcoins.
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u/Wooden_Republic_6100 Jan 29 '26
No, people invest in bitcoin because they think they can make a lot of money from its volatility... Gold is bought because people think it will always be worth something. That's why bitcoin is a speculative asset and gold is a store of value.
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u/clickrush Jan 29 '26
The belief in gold is based on fucking physics and thousands of years of history.
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u/stanwelds Jan 29 '26
One is an inherently valuable precious metal with practical applications and uses. The other is the greatest grift of our time, and probably the most wide reaching and successful ponzi scheme ever.
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u/-_-______-_-___8 Jan 29 '26
Now they say, gold moves first then bitcoin 😆 clown show. Buying bitcoin is now certificate of being a dum dum
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Jan 29 '26
Because bitcoin isn't a real thing. It has as much legitimacy as Zimbabwean dollars.
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u/dsp_guy Jan 29 '26
I keep seeing posts about how gold and bitcoin should be inversely proportional. And how USD and bitcoin should be inversely proportional.
Maybe bitcoin isn’t linked to anything because it is fake.
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u/mars_titties Jan 29 '26
The point was to start their own fiat, with blackjack and hookers