Note that Bitcoin has a limited number of natural sellers. The entire concept is very concave supply (it costs more and more to extract). The number of producers shrinks with time.
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Bitcoin: my answer to the repeated questions. No, there is NO way to properly short the bitcoin "bubble". Any strategy that doesn't entail options is nonergodic (subjected to blowup). Just as one couldn't rule out 5K, then 10K, one can't rule out 100K. Gabish?
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Shorting a future creates an unbounded liability: you are responsible for all your personal assets. Unlike futures, options have natural sellers: covered calls (hence spreadable into synthetic puts), & they should have been introduced AT THE SAME TIME as the future.
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Bitcoin seems to fit a Stable Distr, cannot rule out Cauchy! (Collaboration w/
@financequant ) Note that this makes practically any price level possible: whether 100K or 100.pic.twitter.com/IuFxv6D8wO
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Deriving the distribution of Bitcoin assuming Log Returns Student-T as specified by
@financequant . (There is no PDF for corresponding Stable Dist. For Cauchy set alpha=1)pic.twitter.com/X3ipzfMf6M
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BITCOIN, 2 points: + Returns are not additive at high volatility: Something that is up 1000% then down 90% is net breaking even. + Do not read accounts in papers about "causes". At high volatility, the word "cause" should not be used.
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you might use the same argument to say that nothing can be properly shorted. But clearly, everything can.
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How many securities move by 2 orders of magnitude ? Think a bit.
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I agree. I'm bullish on bitcoin (with a 7-figure stake). But even if I thought it'll be $5,000 in a year, I'd never place that bet, because it could just as easily be $100,000 in a year. E.g., I'm surprised it rose to $10K so quickly.https://twitter.com/BadgerPundit/status/929580114198827008 …
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I would never short bitcoin. I asked you earlier about hedging against the situation where clearing houses taking on bitcoin trading can't manage. How would you go about hedging against the clearing houses in general?
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Conversions & reversals with options.
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Bitcoin futures are cash settled. No delivery requirement. It’s just a sentiment indicator that could be completely wrong compared to the actual price. Truly the most highest form of speculation ever created.
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Bitcoin are spread in a mass market with very different kind of investor which will not behave as any other market we know. Bitcoin is even more than pure speculation.https://medium.com/@netcashfx/futures-will-only-feed-the-growth-4205f77806 …
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Agreed. Coinbase couldn’t even keep their site up last week from the overwhelming demand. People are buying BTC on their phones in between selfies and Facebook posts. It was the #1 app in the App Store last week.
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How India Economic Times reported this tweet: https://economictimes.indiatimes.com/markets/stocks/news/shorting-bitcoin-a-challenge-prices-likely-to-top-100000-nassim-nicholas-taleb/articleshow/62019468.cms … Apparently you think it's LIKELY bitcoin will hit $100k.
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"Taleb is known for predicting black swan events" - rather than say, "Taleb is known for writing a book about black swan events". From that point on I didn't have much faith in the article.
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i'm thinnking of investing.. trying to read up and talk to as many people to get input. I like the concept but still have my doubts
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The dollar and other debt based are in a bubble. They are hyperinflating- bitcoin etc cannot be in a bubble if only 5% of people have heard or it and the usd is hyperinflating
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Dollar's pretty remarkably steady.
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