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I haven’t heard a good framework on how to evaluate Bitcoin as an investment, so in this video I’ll attempt to share my thoughts on how one can evaluate Bitcoin and cryptocurrencies as an investment.
There’s a lot of hype and fear around cryptocurrency, and I try to examine both the bull and bear cases.
The two angles I use are the following:
1. Value by popularity
2. Value by dividend of future capital returned (i.e, intrinsic value).
Bitcoin as a “store of value” is largely a value by popularity proposition. And a value by popularity carries inherent risks especially if Bitcoin whales decide to transfer their assets away from Bitcoin into another crypto coin or elsewhere.
However, cryptocurrencies if they can capture a significant portion of increasing digital transactions could have intrinsic value if they can capture value in even a small % of all transitions.
Additional links:
https://blog.coinbase.com/what-happened-in-crypto-over-the-last-decade-ee6a2552d630
https://blog.coinbase.com/what-will-happen-to-cryptocurrency-in-the-2020s-d93746744a8f
Enjoy! And please share this video with others on Reddit, Facebook groups, and forums.
Check out my archived articles/posts on Tesla: https://teslamotorsclub.com/tmc/threads/articles-megaposts-by-davet.23473/#post-485768
Disclaimer: All content on this channel is for informational and educational purposes only and should not be construed as professional financial advice. Should you need such advice, consult a licensed financial or tax advisor. No guarantee is given regarding the accuracy of information on this channel.
