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Why A Hedge Fund Manager Is Buying Bitcoin

Discussion in 'Digital Currencies' started by Flight2gold, Mar 11, 2016.



  1. Flight2gold

    Flight2gold Silver Member Silver Miner Site Supporter ++

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    Obviously PM's are the first choice. Nothing you can't assume your going to lose.
    If Bitcoin can shot up $100 or so after Greece what can it do after China or the world?
    ------------------------------------------------------------------------------------------------

    Why A Hedge Fund Manager Who Made A Killing From Subprime Is Buying Bitcoin


    Snip:
    But this is where it gets really interesting: if one wants to bet on a massive Chinese devaluation (which is coming, the only question is when) one can simply short the Yuan as so many hedge funds have done in the past 2 months only to find that by "fighting the PBOC" they are gambling not only with their AUM, but their professional careers due to not only the unlimited downside of their trades, but to the substantial leverage involved in such FX trades.

    Furthermore, relentless interventions by a belligerent Chinese central bank in recent weeks have shown that even as the Yuan will ultimately devalue, and dramatically at that, the PBOC will do everything in its power to crush the "hated" speculators, among whom such brand names as George Soros, along the way by inspiring sudden, violent and massive surges in the currency, in the vein of the Bank of Japan circa 2011.

    So what is one trade that can be put on to bet on further Chinese devaluation (or outright economic collapse) with limited downside, with unlimited upside, and one which is guaranteed to be profitable if and when the local Chinese depositor herd gets out of Yuan en masse after the next 10%, 20%, 50% or more devaluation and rushes into bitcoin? Simple: do precisely what we said in September, and precisely what Corriente's Mark Hart is saying now: buy bitcoin, because once the Chinese buying frenzy is unleashed, and $25 trillion in deposits scramble to be packed into a product with a $6.5 billion current market cap (but only when the price of a bitcoin is $430; the market cap does rise to $25 trillion if every bitcoin is worth $1.6 million) one thing will happen: the price of bitcoin will soar exponentially.

    http://www.zerohedge.com/news/2016-...ager-who-made-killing-subprime-buying-bitcoin
     
  2. anywoundedduck

    anywoundedduck Gold Member Gold Chaser

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    One need only spend five minutes reading Wiki's explanation on how to purchase bitcoin to realize that the world of bitcoin is rife with fraud and deciet, Once you get past the possible fraudulent buying transaction, and have bitcoin in your possession,.....
    Wait a minute. You don't really ever have bitcoin in your possession. It is located on somebody's server in the form of bits and bytes. What a novel way to invest.
    If you don't hold it, you don't own it.
     
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  3. Flight2gold

    Flight2gold Silver Member Silver Miner Site Supporter ++

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    That's why I started a thread asking opinions on the best wallet.
    Obviously know what you can lose before you venture into the pool.
    I agree PM's are the best bet.
     
  4. the_shootist

    the_shootist I self identify as a black '69 Camaro Midas Member Site Supporter ++

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    If you don't hold it, you don't own it. I'll pass on the bitcoin movement. At least I know my enemy with the banks and I can (somewhat intelligently) move digital FRN's around (and out) of that system with a lot more confidence based on my experience with that system.
     
  5. oldgaranddad

    oldgaranddad Gold Member Gold Chaser Site Supporter ++

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    Bitcoin is often used to circumvent currency and capital restrictions. Buy bitcoin here; sell bitcoin in the banking haven of your choice.
     
  6. anywoundedduck

    anywoundedduck Gold Member Gold Chaser

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    Yes, but that is money laundering, a felony.
    One day the Fed will get a court order for bitcoin transaction data.
     
  7. the_shootist

    the_shootist I self identify as a black '69 Camaro Midas Member Site Supporter ++

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    Bingo! Too many variables for me to sink my hard earned FRN's into it. Gold is better and more reliable...oh, and it doesn't matter how many FRN's are tied to it at any given time. For a useless relic, gold is fairly pricey right now at $1275 an ounce so that alone tells me something about the usefulness and hints at the true value of gold
     
    Last edited: Mar 11, 2016
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  8. FunnyMoney

    FunnyMoney Silver Member Silver Miner

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    Bitcoin is the modern day Tulip. Will the mania go to where tulips did? I don't know, but in the end it could easily go to where Tulips did in their end.
     
  9. Flight2gold

    Flight2gold Silver Member Silver Miner Site Supporter ++

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    I definitely didn't post to compare anything to gold and silver. Have purchased pm's and will continue to do so.
    Just another avenue that I thought was interesting.

    Tulips? Yes absolutely positively if they wither at the wrong time.

    Anything can obviously be used as a tool for illegality.
    I would imagine that's part of the reason there's cocaine residue on most US currency.
     
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  10. Varmint Hunter

    Varmint Hunter Gold Member Gold Chaser Site Supporter ++

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    How would you access your bitcoin if they shut down the internet?
    or EMP?
     
  11. FunnyMoney

    FunnyMoney Silver Member Silver Miner

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    How would you sell your stock in ABC company if the company falls off the face of the earth? You are at their mercy.

    Begging? Class action law suit? I was involved in one of those for another stock, we'll call it XYZ company to protect the guilty - I got about 2 cents back.
     
  12. Flight2gold

    Flight2gold Silver Member Silver Miner Site Supporter ++

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    I believe a hardware wallet would be the answer to that but please correct me if I'm wrong.
    EMP ? I don't think it's going to matter.
     
  13. oldgaranddad

    oldgaranddad Gold Member Gold Chaser Site Supporter ++

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    EMP doesn't cover globally. It is a regional weapon if they can use it. The US in the 1960s exploded some nuclear weapons in low orbit under Operation Dominic know as the fishbowl events. The main test was called Starfish Prime. It didn't fry much over Johnston Island where it was detonated. It did momentarily disrupt electrical distribution in Hawaii but had not residual effects. Yes, it did blow out street lights but electrical engineers claim that it was how the local grid was engineered back in then and how they handled surges. After the 1965 North East black out and subsequent other wide spread blackouts (2003, etc.) most grids have been redesigned to handle the surges that did most of the damage.

    I really think a lot of this EMP stuff is hype and scare tactics.
     
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  14. oldgaranddad

    oldgaranddad Gold Member Gold Chaser Site Supporter ++

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    Using bitcoin to get money out of a country is the circumvention of capital controls and not money laundering.

    Money laundering is disguising the original ownership and control of the proceeds of criminal conduct by making such proceeds appear to have derived from a legitimate source. If it is your money legally in the first place then it is not money laundering.

    I don't think think the Feds ever want to get a court order to find out who moved what amounts, when and where to. If they could. There would be too many government officials in that list (and quite embarrassing) along with too many government front companies used for espionage and other black government programs. That is the Sword of Damocles that keeps BitCoin from being shut down otherwise the US and other governments would have quashed crypto-currencies long ago. It's not just for drug dealers like the Silk Road folks.

    Why do you think people like Greek Finance Minister Yanis Varoufakis threatened the EU to go to BitCoin? How much you want to bet that a "Whose who?" of Greek elites successfully used it to get cash out of Greece before and during the financial crises? A lot of international trade with Venezuela is being done with BitCoin too to circumvent the idiotic Maduro finance edicts not to mention how many Venezuelan elites are funneling their money out using BitCoin.

    As to the legality or illegality of circumventing capital controls and the dubious constitutionality and enforcement of “The Foreign Account Tax Compliance Act” (FATCA), that is a discussion for another thread.
     
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  15. anywoundedduck

    anywoundedduck Gold Member Gold Chaser

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    A rose is a rose, by any other name. (Money laundering is circumventing capital controls.)
    But have it your way. Even so, I am sure the IRS are chomping at the bit to review bit coin users records, (chomping at the bit to get to bitcoin, get it?)
    and if we continue to push towards a totalitarian government, they will.
     
  16. oldgaranddad

    oldgaranddad Gold Member Gold Chaser Site Supporter ++

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    The government has had ample time and resources with the Silk Road BitCoin data. They did nothing but sell off the bitcoins at auction. Plenty of drug purchasers in the US (30% of the Silk road user base) with very few reported prosecutions, except Ross Ulbricht.
     
  17. smartypants

    smartypants Seeker

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    From the ISS space station.
     
  18. smartypants

    smartypants Seeker

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    Paper wallet in a safe, maybe even with multisignatur like 2 of 3 or even 14 of 15 if you like.
     
  19. solarion

    solarion Gold Member Gold Chaser

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    Irrational EMP fear isn't much of an argument against bitcoin. Bitcoin wallets consist of a singe key file that can be stored on any computer media. Not sure what people think an EMP will do to a CD sitting in a locked safe. In a serious EMP event bank credit "dollars" would be more vulnerable than properly stored bitcoins and would obviously affect a far greater portion of society.

    As far as the money laundering fears they're a bit overblown too. Goobermints seem unable to even consistently define what a bitcoin is. Sometimes it's treated as money and other times it's treated as property. Someone that knows what they're doing with bitcoin and intent on preventing snoopy .gov trolls from knowing what they were doing with their finances would be nearly impossible to track down.
     
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  20. Usury

    Usury Gold Chaser Platinum Bling

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    One of the things that from a consumer perspective is a little off-putting about bitcoin is that once a transaction is consummated, it cannot be reversed. So if I send X bitcoins to a merchant for a transaction and they never deliver the goods, I really have no recourse. With my credit card, I can dispute the transaction. Heck even with a bank wire, I might could get the feds to go after the merchant for wire fraud, but bitcoin fraud? I think that I'd be on my own unfortunately...
     
  21. solarion

    solarion Gold Member Gold Chaser

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    That's correct. Bitcoin should be thought of like cash or gold in this regard. Once spent it is not reversible. The opposite of constantly exploited systems like paypal and credit card chargeback scams that pass the risk off to the seller.

    If you wish to conduct a transaction using bitcoin with someone you do not know or trust then you should employ a trusted 3rd party to facilitate the transaction.
     

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