If you have 30 minutes to spare.... (crypto digital assets topic)

[johnarb]

As the title says, spare 30 minutes and something might click on the thought process if you're a skeptic of this space.

Original air date of the interview was in the beginning of December 2020, so bitcoin price mentioned is lower, and this was before GME, but there's correlation to that issue

I watched it all the way to the end and found it really interesting. The last part of the video has really good stuff for crypto investors of why the bitcoin price is still "low"

 

[qlai]

The last part of the video has really good stuff for crypto investors of why the bitcoin price is still "low"

Maybe you can answer this question I have had. When Euro came about, they priced it based on a basket of existing currencies which made up the Euro. Since Bitcoin started from zero and seemingly has no upper boundary, I assume it will eventually find some sort of equilibrium to USD. Once it does, it will become just another relatively stable store of value.
So how does one know at what price that will be? Will it be $1k, 100k, 1M, 10M? In other words, how do I know I will not invest in currency at $40k that will ultimately settle around 10k and will have no chance to get back to 40k ever?

 

[johnarb]

Maybe you can answer this question I have had. When Euro came about, they priced it based on a basket of existing currencies which made up the Euro. Since Bitcoin started from zero and seemingly has no upper boundary, I assume it will eventually find some sort of equilibrium to USD. Once it does, it will become just another relatively stable store of value.
So how does one know at what price that will be? Will it be $1k, 100k, 1M, 10M? In other words, how do I know I will not invest in currency at $40k that will ultimately settle around 10k and will have no chance to get back to 40k ever?

I'm not expert in currencies, but I don't think bitcoin will play a role in the valuation models of CBDC's as bitcoin is decentralized. Bitcoin will continue to be a collateral asset and continue to be very volatile at times due to its limited supply and highly elastic demand.

My most favorite video of Raoul Pal discussing this has been removed from YouTube. Raoul talked about Facebook Libra (now Diem) was going to be priced with a basket of different currencies as inputs and the US $ will just be one of them and CBDC's will be similar in concept.

There's this other Raoul Pal video below, there's a lot of things to sift through it, there's no one section like in the other video where he explained it quickly

I started the video where I think it might be a shortcut, but the whole video itself has more context around the ideas but it's all speculation from RP and his team

 

[sef88]

Maybe you can answer this question I have had. When Euro came about, they priced it based on a basket of existing currencies which made up the Euro. Since Bitcoin started from zero and seemingly has no upper boundary, I assume it will eventually find some sort of equilibrium to USD. Once it does, it will become just another relatively stable store of value.
So how does one know at what price that will be? Will it be $1k, 100k, 1M, 10M? In other words, how do I know I will not invest in currency at $40k that will ultimately settle around 10k and will have no chance to get back to 40k ever?

Currencies are usually stationary (in statistical lingo) i.e sideway ranging. Does it mean that bitcoin will stabilise and range around a mean value?

 

[johnarb]

Maybe you can answer this question I have had. When Euro came about, they priced it based on a basket of existing currencies which made up the Euro. Since Bitcoin started from zero and seemingly has no upper boundary, I assume it will eventually find some sort of equilibrium to USD. Once it does, it will become just another relatively stable store of value.
So how does one know at what price that will be? Will it be $1k, 100k, 1M, 10M? In other words, how do I know I will not invest in currency at $40k that will ultimately settle around 10k and will have no chance to get back to 40k ever?

I misunderstood your question. Bitcoin is a crypto currency (form of payment) and also a store of value. (speculative investment asset)

That's the exciting part of investing in bitcoin, we don't know where the equilibrium price is and it's still in a price-discovery stage

There are attempts to figure out the fair value (price) of bitcoin, but even in the short term, no one really knows, and in the long term, it's impossible. Metcalfe's law, supply and demand, latest news/data (i.e. Institutional Investors, retail investors, GBTC published numbers, adverse regulations

As I'm currently a bitcoin hodler, I believe the price of bitcoin will be higher than it is now and I don't try to trade in and out of it

I diversify my crypto investment portfolio in order to mitigate the wild valuation swings. The other crypto digital assets have different value props and use cases that are different than bitcoin's SoV/form of payment