Dec 31

Cryptocurrency Has No Intrinsic Value

Yesterday I bought some cryptocurrency, hoping to get lucky before some of the many, many coins go to the moon.

  • USD$2.61 worth of Ethereum ($ETH) at $3,715.71 on Robinhood
  • USD$4.02 worth of Bitcoin ($BTC) at $47,493.05 on WeBull

I am trying to learn from a mistake I made last year. I should have held (or sold for a massive profit) my Dogecoin ($DOGE) investment from July 2020. It went from $0.003216 to over $0.69 per coin. I spent $402 to buy 125,000 shares and sold in November of that same year at $0.004 for just under $100 profit. If I had held, I would have earned over $86,000 by selling at the peak.

Ah well, try not to make that mistake again. Instead, I’ll make all new ones!

I’ll put a few thousand into a variety of cryptocurrencies. Not enough to bankrupt me, but enough to have skin in the game should things take off.

So, I started doing some earnest research into the field. Lots of good resources out there, but I first referred to comments from much more experienced co-workers about which coins they are investing in, which wallets they use, and which exchanges they use. They suggested to check out Reddit’s Cryptocurrency subreddit. They also watch some unbiased YouTube videos and read the project whitepapers.

Immediately, I realized I don’t have my money in the right accounts. My traditional brokerage doesn’t offer direct investment into cryptocurrency, so I will have to move some savings into other accounts. I will use Robinhood and WeBull because I have accounts and a few spare dollars there. I am also looking at buying through Coinbase, which is popular.

My traditional brokerages do allow me to invest indirectly through mutual funds:

  • funds that directly own coins, such as Grayscale Bitcoin Trust (GBTC) or Orsprey Bitcoin Trust (OBTV)
  • funds that own futures, such as ProShares Bitcoin Strategy ETF (BITO)
  • equity in companies related to cryptocurrency, such as Coinbase (COIN) or PayPal (PYPL)

I am also interested in storing my coins in my own cryptowallet, but that’s just a technical fascination for me. Co-workers seem to like the Ledger Nano X hardware wallet or Keplr software wallet. Security / investment safety is important, but I will trust those companies until I make my millions. By that time, I will probably know more and have the discipline to properly manage my cryptocurrencies.

WeBull has some quick and easy videos to help new crypto investors. Coinbase gave me some free cryptocurrency for watching some targeted ads (framed as educational materials) about Amp (AMP), Stellar Lumens (XLM), Fetch.ai (FET), and The Graph (GRT). They aren’t worth much, but we’ll see.

It seems like most people are bullish on these coins:

  • Bitcoin (BTC)
  • Ethereum (ETH)
  • Dogecoin (DOGE)
  • Cosmos (ATOM)
  • Shiba Inu Coin (SHIB)
  • Algorand (ALGO)
  • Avalanche (AVAX)
  • Solana (SOL)

Along the way, I found a couple lighthearted videos I want to share too:

The interviews with Warren Buffett and Charlie Munger are hilarious. Those guys are so right–there is a lot of risk and the coins themselves have no intrinsic value and produce nothing. I like to think of them more like currency, though. They are a means to an end. I’m no expert at trading on fiat currencies, though, so…I am really out of my element here and this is all a gamble at this point.

Remember, do you own research and make your own decisions. I am not a financial advisor and this is not an offer to sell or recommend any investments. If you use my referral links to Robinhood, WeBull, or Coinbase, I may receive a small monetary reward when you sign-up.