If You Had Bought Crypto – How rich would you be if you invested in Crypto? | Hacker News Reader

If You Had Bought Crypto – How rich would you be if you invested in Crypto?

ifyouhadboughtcrypto.com

27 pointsletsjaam32 comments

There is a common misconception amongst people holding stocks, crypto coins and other investments: that they equate to cash. You would not be rich if you had invested in Crypto, you would be rich if you had invested in crypto and had successfully liquidated your position.

That second bit is the hard part when you have a large volume of something since the liquidation tends to depress the price.

And in the world of Bitcoin you might end up with nothing if the exchange accidentally loses your loot (chance of which goes up as you have more money outstanding).

So any realistic scheme dealing with the liquidation of such an amount of crypto coins would be to spread out the sale over a longer period of time in small amounts to be taken back out.

Which makes me wonder how much the largest successful one-shot liquidation anybody on HN has ever done and how they did it?

Here's an idea for a website in similar vein: liquidatemycrypto.com

Given an input of X amount of cryptocurrency Y, it will consult the orderbooks of a number of exchanges that trade it, and tell you how much of it to sell where in order to get the best liquidation price possible, and show you your slippage in percentage lost relative to what you may have thought your coins were actually worth.

IIRC there was a bot in the #bitcoin IRC channel years ago that did exactly that. Afaik it only looked at the Mt. Gox order book but given that Mt. Gox was pretty much a monopoly back then the result was still accurate.

You can watch multi million dollar orders get filled all day on the high-volume exchanges. So, all hypotheticals and FUD about literally everything being a wash trade aside, it sure looks like there's no serious practical difficulty liquidating Bitcoin at present.

To put it in perspective, the daily volume in BTC is a few 100,000s. 5-600'000 BTC is $10B. Sure the Winklevoss twins can't liquidate their entire holding in a week but if you only have a few million dollars worth of bitcoin, you can liquidate in a few days without moving the price significantly.

The other major crypto-currencies are more or less liquid in proportion to their market cap.

Not sure what you’re measuring... gdax alone averages around 25k btc traded per day. At today’s price that’s 450mil usd

Thanks, I mistakenly wrote million instead of billion. Edited.

Visit https://www.gdax.com/trade/BTC-USD. Notice the v-shaped graph below the price graph. Hover over to the left on the green side. You won't have an answer to your largest-ever-on-HN question, but right now I can tell you these are all possible (picking random zoom levels) with the quoted price around $18,100:

You can sell 556 BTC for $9.949 million for an average price of $17,893.

You can sell 2,160 BTC for $37.4 million for an average price of $17,314, which is 95.6% of the current quoted price.

This is if you are a complete idiot, transfer your Bitcoin to GDAX, and place a market sell order. Maximum slippage, and yes, you'd temporarily tank the GDAX market down to $16.5K or $17K. And it takes a while to withdraw that amount of money from Coinbase, but eventually it happens, and your trade is already complete.

Anyone with an ounce of sense would instead sell their BTC in a number of limit-order chunks over a day or two to reduce slippage.

Now, you can keep saying that it's a "common misconception" that the last ticker price means anything. Technically you are correct. But I doubt the guy who just liquidated BTC for over $30 million USD at 95% of that price would care.

True, but it's still a nice "what if" for small amounts of currency.

I wrote down my first bitcoin wallet address in May 2011 and revisited my noted in mid-2013. I had the real intention of investing the unimaginable amount of 20$ (insert Dr Evil Meme) - but I gave up after a bit of research because it was too complicated to get some.

The calculator tells me I could've earned 11460 Bottles of Budweiser (or hopefully 10k of real beer) - but I'd almost 100% had sold off everything at 1-4k per BTC.

The only cryptocurrency I managed to buy is DOGE. Too bad it didn't really increase by more than 20% in the ~2 years I held it. But hey, still ONE free beer if I sell all of it now ;)

> Which makes me wonder how much the largest successful one-shot liquidation anybody on HN has ever done and how they did it?

Could be that one sale that flash crashed Coinbase' ETH/USD market. One big sale caused lots of margin positions to close; which spiraled ETH's price from ~350USD to 13USD. Went backup immediately tho.

Also, you might have gotten out at any of the previous all time high prices, such as four years ago when everyone though $1000 was absolutely ridiculous and that was as high as it would ever get.

"If you had played these lottery numbers last year - how rich would you be?"

Seriously...why do people love articles like this? Why not just sum them all up into one big article, "What if you had a time machine"

This is fun but also pointless. There’s no guarantee you would have made any money. And the model assumes that you’d buy and hold this whole time.

So if you’re looking at this and beating yourself up...don’t.

Right. I know about a dozen people who had a lot of bitcoins back in 2011 / 12 timeframe. None of them held on to it and are beating themselves up now.

As the developer I couldn't agree more - it's pointless... but hopefully a little bit of fun along the way.

Isn't that what the internet is for?

Totally! I’m not knocking the site itself which I think is super cool. But these “what if” games are very dangerous.

There’s a term in economics for it...when you think you’ve lost something that you never even had.

Beautiful site, nicely done.

I do personally know a lot of people in San Francisco who had bought bitcoins when it was fractions of pennies. Some lost all of it in the MT GOX hack / bankruptcy, and most others sold what they had off after that incident.

Just 1 guy, my boxing trainer, held on to the bitcoin 1 of my friends paid him with, for Personal Training. In his case also it was about 300$ worth of bitcoin paid to him in 2013, and it was more like he forgot he even had it, and then all of a sudden, last month, he realized it was now worth 20,000-ish and sold it all off and 'invested' it back into Litecoin and Etherium. 2 days after he bought Litecoin, Coinbase froze all trading of Litecoin on their platform.

The funny thing about this is that the friend who paid my trainer worked for a Bitcoin startup and had 1000s of bitcoins. He sold it all off in 2015. Didn't even keep 1 coin. If he had held on to it, he'd have had about 20 million USD worth of bitcoin today.

So the site should really be https://ifyouhadboughtcryptoandarestillholdingontoit.com :)

I offered to pay my contractors in bitcoin years ago and no one was interested.

I told my friends they should by it, no one did, until this year. Some of them managed to do brilliant things like actively buy and sell yet not make a penny. This is like Howard Marks describing day trading as making $3 when the price went up $30.

While I'm optimistic about Bitcoin, no one can defend the value of barely functional, abandoned, and centralized altcoins. This is completely out of control. It is a commodities trading video game where the underlying assets are completely imaginary. The bad altcoins will be worth absolutely nothing at the end, much like the dot com bubble. The real estate bubble was kinder, sans leverage.

Wow, interesting story. Speaking of altcoins, what are your thoughts on Ripple? It seems promising to me in that nearly a 100 banks are using their BlockChain technology to process cross border payments and cut fees and transfer time (down to seconds from days).

At the same time, I'm wary of investing in altcoins, after reading a whole bunch of scams that people have perpetrated online in this space.

Also, is Ripple ( XRP ) considered an altcoin in the first place??

Thanks for the comment. Maybe we'll snap up that domain too...

The site was born out of years of talking about investing in Bitcoin and a failed attempt at mining them in late 2013. All the 'what-ifs'.

Hopefully people who didn't invest and those that mined early and got out can have a little laugh (or cry) inside. It's just a bit of fun.

This is an interesting but dangerous thought experiment, like all of the other instances where you ponder what would have happened if only you had picked the right investment and timed the market right.

If there is a lesson to be learned about reading the markets, learn it, but don't dwell on the money you didn't make because it can cloud your judgement next time.

I'd still be broke:

If I was was the type of person that invested in Crypto, I would have also "invested" in all the other fads: lottery-tickets, slot machines, ostrich farming, classic cars, overpriced college degrees, Flooz.com, and Gold right at the top of the bubble.

Edited: spelling per the helpful editor below.

A good collage degree should only be $10 or so, it's not that hard to cut/paste pictures together.

Usability suggestion: tapping one of the icons at the top should change the drop-down to that currency.

Also I'll echo others' comments that cryptocurrencies are hijacking the word "crypto," which most definitely does not mean "cryptocurrency" to the crypto community.

Thanks for the feedback, we're looking at some little UI tweaks.

It's hijacked the word "coin" too.

Gone are thoughts of the halcyon days of arcades. Now it's just get rich quick schemes and #ad.

meta -- But there's more to cryptography than cryptocurrency.

That's assuming your wallet wasn't hacked and/or you didn't hold your coins in MtGox.

Buying into pyramid schemes is always profitable as long as you are the one who gets to cash out

It's like gambling: shoulda/woulda/coulda.

Why do people like these things? Pipe dreams?

How to make a bubble bigger: "How rich would you be if you had done X?"

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