patrick.net

Patrick says

The whole thing depends on no one figuring out how to reverse the hash function it uses.

The original white paper suggested using SHA-256 but I don't know if that's what was actually implemented.

It's good to go back and re-read that white paper from time to time. Satoshi was more script kiddie than genius - the paper simply repackaged other peoples innovations and added an NTP server to create a time stamps on a dynamic list of transactions (similar to a single array database?) To a non-coder it seems pretty fragile to me. It basically admits it's security is based on the expense to hackers being greater than the expense of honest participation in the chain. Which I think is true right now.

I agree with @Patrick - it's only a matter of time. Wouldn't it be trivial for a real quantum computer to crack the encryption and re-write the block chain? Or is quantum computer just another bullshit invention meant to dazzle us neophytes?

right now it is not worthwhile to sell covered calls for Fidelity Bitcoin ETF (ticker FBTC) as my rule is the probability of expiring out of the money added to the annualized gain from the call premium should equal at least 100%

for this call option contract, that is 80% + 9.87% or 89.87%

IDK, but I’ve made a lot of money on BItcoin through Grayscale, bailed and now only trade etherium through 2 etfs.
Makes more sense to an idjit like me.

SharkyP says

I’ve made a lot of money on BItcoin

so Bitcoin is not going to return at least 20% a year on average for next 10 years ?

I don;t trust Bitcoin.

Why is this thing valuable? What am I missing?

It's valuable because it's difficult to get, and useful for money laundering.

But it all depends on no one being able to reverse the hash function it uses. Complicated to explain, but a breakthrough in quantum computing could make all Bitcoin worthless overnight.

Bitcoin is shit. You can't eat a bitcoin.

You can eat gold - it just comes back out your butt after a day or so.

Also, if the world ends, you can't do anything with a bitcoin. You can take gold and beat it flat to make a solar mirror to cook your yams and face stew.

stereotomy says

Bitcoin is shit. You can't eat a bitcoin.

You can eat gold - it just comes back out your but after a day or so.

Also, if the world ends, you can't do anything with a bitcoin. You can take gold and beat it flat to make a solar mirror to cook your yams and face stew.

I see your point as far as utilitarian function of precious metals such as during an apocalypse era. Melt down the precious metals to make for a Civil War style rifle.

I guess invest in alternative assets (gold, silver, Bitcoin, etc) as far as up to 20% of savings as a hedge for fiat currency but not for preparing to be a survivalist or extreme homesteader.

I agree as alternative assets will be of no use during the +25 years of society trying to recover from an apocalypse event, so bullets, water, medicine kits, shelter, canned food, fishing gear, potato seeds, and trusted family and friends are invaluable, not gold coins.

AD says

I agree as alternative assets will be of no use during the +25 years of society trying to recover from an apocalypse event, so bullets, water, medicine kits, shelter, canned food, fishing gear, potato seeds, and trusted family and friends are invaluable, not gold coins.

In that situation, tobacco and alcohol will likely be used as money.

Cigarettes were money in Germany after their defeat in WWII.

Patrick says

Cigarettes were money in Germany after their defeat in WWII.

Yes, women would put out for a pack of Patrick's.

Yes Bitcoin likely competed with precious metals from 2012 to 2025.

And precious metals are on a tear for about the last 12 months with silver up 272% and gold up 90%.

However, wealth managers are recommending to their clients that they 1 to 4% at least in Bitcoin. And traders may cash gains out in silver and rotate to Bitcoin.

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https://www.tradingview.com/news/cryptonews:67bac0d5c094b:0-dalio-u-s-nears-crisis-point-as-bitcoin-trapped-by-american-selling-pressure/

Ray Dalio warned the U.S. stands “on the brink” of transitioning from Stage 5 pre-breakdown to Stage 6 systemic collapse as Bitcoin is trading defensively at $88,000, trapped in a 60-day range by record institutional selling pressure from American counterparties.

The billionaire investor’s latest analysis of the “Big Cycle” coincides with Bitcoin’s failure to live up to its “digital gold” narrative, while traditional safe havens surge to all-time highs.

There are about 1 million Bitcoin to mine over next 105 years to reach the limit of 21 million Bitcoins.

So 20 million coins now in circulation at $89,000 each and the market cap is about $1.78 trillion.

The household net worth (stocks, home equity, etc) of Americans totals $167 trillion.

So if the world had 1% of its $454 trillion in wealth in Bitcoin that would be $4.54 trillion.

https://bitbo.io/news/david-marcus-bitcoin-1-5m/

Former PayPal President David Marcus has made a bold prediction that Bitcoin should reach a price of $1.5 million. Marcus expressed confidence in this forecast, stating, "That's going to happen." His comments add to the ongoing debate about Bitcoin's future valuation, as the cryptocurrency continues to attract attention from investors and financial experts alike.

Use Bitcoin as a hedge against the US Dollar weakening.

https://www.forbes.com/sites/chrissamcfarlane/2026/01/31/currency-wars-bitcoins-rise-against-the-dollar/

“The U.S. has benefited from the dollar serving as the world’s reserve currency for decades. But that’s not guaranteed to last forever,” BlackRock CEO Larry Fink said in his 2025 annual letter to investors. “If the U.S. doesn’t get its debt under control, if deficits keep ballooning, America risks losing that position to digital assets like Bitcoin.”

Major banks, notably Bank of America, now allow advisors to recommend spot Bitcoin ETFs, generally suggesting a modest allocation of 1% to 4% of a client's total portfolio to manage high volatility. This approach aims to provide exposure to digital assets for suitable, high-net-worth, or risk-tolerant clients rather than treating them as a primary investment.
Key takeaways regarding bank recommendations:
Recommended Allocation: Typically 1%–4% of a total portfolio for digital assets, according to Bank of America and Morgan Stanley.
Approved Vehicles: Focus is on regulated spot Bitcoin ETFs, including BlackRock’s iShares Bitcoin Trust (IBIT), Fidelity Wise Origin Bitcoin Fund (FBTC), Grayscale Bitcoin Mini Trust (BTC), and Bitwise Bitcoin ETF (BITB).
Risk Management: The recommendation is tailored to the client's risk profile, with conservative investors advised to use the lower end of the range.
Target Audience: Originally restricted to eligible wealth clients, these recommendations are becoming more broadly available to clients of firms like Merrill and Bank of America Private Bank.
Other Institutions: Vanguard is permitting crypto ETFs on its platform, while others like Schwab and JPMorgan also provide access.
The shift reflects a move to treat Bitcoin as a, volatile, but recognized alternative asset class within traditional, diversified portfolios