Perhaps the BEST B1G Forum anywhere, here at College Football Fan Site, CFB51!!!

"It's not having what you want, it's wanting what you've got."
-Sheryl Crow, Soak Up The Sun

I've always loved that line, since the first time I heard that song.

Still, I want a 1965 Mustang convertible, and a lake house on deep water.

Your home, to me, is an "asset of last resort".  If you get in a pinch, you can HELOC it and raise funds.  I guess borrowing off a credit card is even laster as a resort.

Whole life insurance policies are assets.  Precious metals.  Cash.  Collections, art/coins/stamps.  

I'd like someone to explain Bitcoin. I do not understand it at all.

I'll give it a shot. I'm going to skip over all the technical aspects of mining, of blockchain (blockchain actually being the really interesting/important technology), etc. I'll just tell you why Bitcoin is stupid.

Bitcoin has a problem. It's trying to be money. 

But money, to be good at being money, has to really have two key factors:

• It has to be a good currency, i.e. it is easily and commonly accepted as a medium of exchange in very wide number of venues. The US dollar is an excellent example of a currency--it's accepted damn near everywhere (including many places outside our borders). 
• It has to be a stable store of value, or more simply, it has to have predictable purchasing power over time. The US dollar has traditionally been a good if imperfect example of a stable store of value, with the exception of some inflationary periods over time (late '70s, the last few years). 

Bitcoin fares poorly at both. 

First, as a currency. You can't easily walk into a grocery store and pay for your groceries in Bitcoin. There are some places that accept Bitcoin as payment, but they are more obscure. That dramatically limits where and how you can spend it. 

Second, and far more important than the first, is that it's not a stable store of value. Let's say I want to sell you my car for $15,000USD, and you want to pay me in the equivalent value of Bitcoin. Well, next month I know (almost) exactly how much $15,000USD will be able to purchase--very slightly less than this month due to inflation, but basically the same. But next month I have NO freakin' clue what Bitcoin's level will be or how much I can purchase with it. At the bottom of this post is the 5Y chart of Bitcoin... You can't rely on that. 

Bitcoin, instead, becomes a speculative currency arbitrage investment, much like buying precious metals or foreign exchange trading. If I sold you my car in Sept 2023 for $15,000USD worth of Bitcoin, and held it, I'd be in great shape right now more than doubling the value. But if I'd sold it to you in Nov 2021 and I had actually needed to convert it to USD in Jan 2023, I'd have turned that Bitcoin equivalent to $15,000USD into less than $5,000USD. 


My advice is stay the hell away from it. 

I have a $100K HELOC on my home which sits dormant. I suppose that is my last resort?

Other than taking on credit card debt, I'd say it probably is, unless you have gold sitting around etc.  It's your last viable sensible resort I think.

I should probably sign up for one.

Well, that's the thing.

What is backing Bitcoin? Or any other crypto? Why is it even allowed to exist?

If I buy one, do I get one of these?

Nothing is backing it. But that's not all that uncommon. Nothing is backing the US Dollar except that we have the biggest military in the world saying "it's money, dammit." We were off the gold standard and any semblance of redeemability a long time ago. 

If you want to get into it, Bitcoin is created by "mining". Essentially using vast amounts of computing power to solve increasingly-challenging algorithms. If you solve one, you have now "mined" a coin and own it, and the algorithm gets that much harder for anyone else to mine the next coin. This is effectively it's guard against runaway inflation--computing power is expensive and finite, so the growth in quantity of coins is limited by the ability/willingness of people to invest money in the mining process. 

One thing that makes it interesting, though, is the blockchain. The blockchain is distributed ledger tracking EVERY bitcoin transaction for all time. Because it's distributed, no one person could ever "counterfeit" a coin or create a false transaction, because any attempt wouldn't be accepted by the rest of the chain. There are technical ways to attack such a chain, but I'm not sure that it would ever be feasible to do to Bitcoin, especially since (if it ever happened) Bitcoin value would crash so fast and so hard that whatever you were able to "steal" would probably now be worthless. 

phony money