I got a couple messages today from my cryptolleagues speculating on the price of Bitcoin, showing some undecidedness, as they both have a little impatience (why isn't it 60 yet?) and would also like a dip to buy some more. What I replied was, that it'll get there and, wasn't 29K dip enough?
A dollar of Bitcoin then, would have bought 40% more than a dollar today. But of course, because it was floundering around there, many people were buy shy, so they would rather wait til the run back up and they can feel "safe" again. It is a funny issue really, but common.
Speaking of dollars...
That was my 100% vote back at the start of the year. It was on a 
Back at the lows, I was buying, but it was trickles because with the ongoing renovation, I just didn't have the capabilities to put more in. But, I did put come. The purchase power of my dollar then was far greater in terms of HIVE than it is today, but this is not really how we look at it, is it?
When we think about the value of a dollar, we think about what that dollar buys in terms of products and services. But when we think about the value of Bitcoin or some other token, we often think about the price of the token itself. We see Bitcoin like a liter of milk (or a new car these days) without really considering what it buys as Bitcoin in the future. I think this is because most of us still think about it in terms of fiat currency and when we think about fiat, it is stable in our head and the price of the products are changing, not the value of the token we hold.
But one bitcoin is always going to be worth one bitcoin, however the purchasing power of that bitcoin is highly volatile and if the trend of the last 12 years is upwardly mobile. We can look at the daily peaks and dips, but zooming out shows that the resolution we should be considering is well down the track and for many, the only thing between buying and profit, is time.
Trends don't hold forever however, which is why so many people are buy shy at the dips, because they are wondering if this is the "big one" that kills it or, they get "greedy" and want the absolute bottom. For example, a lot of people back in the day (less than a year ago) were waiting to buy 9 cent HIVE, which it came close to in November, where it hit 0.102, but that isn't 9 cents, it is 10. So, when it moved to 11 cents, it suddenly became 20% above the desired purchase price.
Expensive as!
When it hit 14 cents, it was 50% above the desired price and now people were priced out of the market emotionally.
100 dollars at 9 cents would have bought 1111 HIVE
100 dollars at 11 cents would have bought 909 HIVE
100 dollars at 14 cents would have bought 714 HIVE
Or at todays prices 844, 690, 542 dollars worth respectively.
Of course, this is hindsight and it can never be known if it is going to go up or die a miserably death in the darkness, but if a person believes that they aren't going to sell until it hits 1, 2 or 10 dollars anyway, it seems strange not to buy at least some at whatever price is around about where we consider low.
However, we all want to buy the bottom, not near the bottom. But, knowing what you know the real price of Bitcoin is 50,000 today, if you were offered Bitcoin for 100 dollars a token today or you could wait until tomorrow and be given it for either 90 or 110, would you wait to buy?
If you bought 10 BTC for 1000 dollars today and sold it for 500,000 tomorrow.
If you waited and got 11 BTC for 1000 dollars and sold it for 550,000.
If you waited and got 9 BTC for 1000 dollars and sold it for 450,000.
None of those scenarios sound bad, right? Of course not! The difference is time, as when Bitcoin was 100 dollars, there were people who didn't buy because they wanted 90 and when it went to 110, said it was too expensive. Even the people who have utmost faith in whatever token they want to purchase are still affected by their emotions and thinking on what the current price is.
If you consider something to be highly undervalued, shouldn't you be buying it at any price until it gets to the point where the reward isn't worth it? Probably. This is why large holders generally don't keep buying into the same tokens they already have a lot of, because it doesn't change the outcome significantly enough.
If I buy $100,000 worth of HIVE at 10 cents, it would be worth 750,000 dollars.
If I sell it all at 10 dollars - it will be worth 10 million dollars.
If I buy 100,000 more today it will cost me 75,000 dollars.
If I sell it all at ten dollars - it will be worth 11 million.
Yes. An extra million dollars is brilliant for the low price of 75,000 - but in respect to the original buy, it requires 75% more capital for only a 10% gain.
If there is someone like me for example who has very little capital but holds a lot of HIVE, it might not be worth me buying. However, for someone who holds little HIVE and wants to sell at 10 dollars, hell yeah it is. Not only that, because there is time involved, the earning on staking ability will continually reduce the cost average downward, making the purchase very significant... if it goes to ten.
But, we are greedy. If we have to wait three years to get a 1500% return, that is just far too long to wait, so we sell to those who think the future price of HIVE is worth more than the cost of buying it today. Because of this, many have sold for pennies on the dollar, or on the ten dollars as the case may be.
Eventually, the projects involved and the markets do their thing and prices are found, with the holders and future sellers hoping that it will swing in their favor and those who got out for pennies no longer even paying attention - until they hear about it later and say "I used to have XXXX Hive that I earned for shitposting".
Of course, I am Hive biased so use HIVE as the token here, but this happens with pretty much all tokens. Humans aren't well suited to looking long, even when we are looking long for investment returns. We are heavily affected by the daily ups and downs and as a result, might lose sight of our own bigger picture. my friends for example might be waiting for a 10% drop to buy, but looking for a 100% increase to sell. The difference on the downside might not be significant, but the gains on the upside are. There is always an asymmetry when getting gains, but it is just how asymmetrical it is that shifts. Of course, we don't want a negative, but sometimes in our quest to maximize the downside, we miss out on having access to the very large upside.
But I think this is partly human nature, as it is the daily dramas that grab our attention in most things, while the long-term goals that we may have and what needs to be done to accomplish them, fall by the wayside. It isn't just when investing that we sell our potential for pennies on the dollar - we do it with our time and attention daily.
EDIT: I forgot to add. My vote is about 9 dollars now and everyone who has got votes from me this year and held, have essentially got 9 dollar votes all year - pretty cool, right?
Taraz
[ Gen1: Hive ]
