I closed my bank accounts in 2011. Cash is my currency of choice for most things. I use bitcoin for long term savings. Cold storage is safer than a bunch of cash under the mattress.
So you're losing money on inflation, and your long term savings are in one of the most volatile assets on the market that derives its value largely from illegal and gray-market transactions.
I wish you luck. But frankly you'd likely be better off putting your long term savings in Boeing stock, and that's saying something.
Due to dollar cost averaging, this is actually a very good thing!
The other major question is what BTC's value is going to be in the long term, when they retire and transition from a net saver to a net spender.
Can’t say the same about most other hodlers, however
lol if poster above started storing money in Bitcoin in 2011 there's a good chance they are the wealthiest person in this thread.
At least your savings aren't losing to inflation, but this strategy has zero real growth and carries a tremendous amount of unsystematic risk[1].
[1]: https://www.investopedia.com/terms/u/unsystematicrisk.asp
What I want is the ability to safely store value.
Saving money in a bank account wasn’t working for me, because monthly fees took literally my last pennies, which led to overdraft charges.
Saving money with bitcoin hasn’t just maintained and stored value for me, it has also grown tremendously in value.
In my case, it’s risky to participate in the traditional financial system anyway, so I don’t feel like experimenting with an alternative system is any more or less risky.
> What do you mean by “real growth”?
Stocks have real growth. It is "real" because your stock is a share of a company whose employees are trying new ideas, teaching each other, making customers happy, etc.
> ... it has also grown tremendously in value.
Bitcoin had a lot of initial growth[1] indicating it was undervalued, and there was a ton of speculation. If you got in early and weathered the storm, congrats, but the market should have bitcoin correctly priced by now.
In general, a currency doesn't grow in value any more than a lump of gold can grow in value.
That it looks like it does is nominal growth, it means your benchmark, e.g. USD, is losing value.
Your bitcoins will get you more USD in 10 years, but the prices of goods and services in USD will increase as well, so it's a wash in terms of spending power.
Keeping your money in bitcoin may be a poor idea, but any reasonable long-term investment strategy isn't going to be FDIC insured, so that isn't really part of the calculation.
You can insure cash with most homeowner's policies, though.
FDIC is meant to protect deposits in banks. If I don’t need to trust a bank, why would I need FDIC?
Edit: silliness aside...
When I get paychecks, I have to either get them cashed at the bank that issued the check, at a grocery store, or through a friend or relative who has a bank account.
I request cash for payment, when possible.
I didn’t learn about bitcoin until 2015, and even then, I had very little disposable income to experiment with. Still don’t have much income. Definitely no salary.
I started with bitcoin in 2015.
The main reason my life savings is almost nothing is because it came from almost nothing. $50 here and there isn’t much, but it’s more than zero
but business-wise many of my vendors have been able and willing to take cryptocurrency especially in the last 3 years.
I've executed many legal agreements paid in crypto. Its made it extremely practical for Americans to have offshore corporations again since the bank account part became difficult but is no longer needed for international commerce and asset holdings.
Yeah its a bad example because thats not whats happening at all. Criticisms are possible but yours are so far off that I guess these are called weak strawman arguments? I don't think this was intentional as its seems more like a precompiled argument that isn't really a response to this situation so I will tell you my experience with international vendors:
When legal contracts are executed a payment method and pricing index is determined. The payment itself does not take a year and there is usually no catalog of goods and services that are "bitcoin-denominated", for our agreements. When the actual payment occurs we use the agreed upon index to use the dollar price, paid in crypto and this takes a few seconds to execute and even in the volatile crypto markets usually nothing is happening in this time frame.
The cryptos typically involve:
Bitcoin most frequently using Tradeblock's XBX index, or CME's index, or Coinmarketcap
Ethereum most frequently using Coinmarketcap, and lately Tradeblock's ETX index
random token that one of us has large consolidated ownership of
stablecoin like DAI, USDC, Tether
This is conceptually no different than any legal contract that use shares for payment. You get a glimpse of this common transaction method when companies are acquired for "cash and stock". For the recipient, it is all about the tolerance of liquidity.
There is a curve of liquidity for different asset classes, with US treasuries and non interest bearing dollars being the most liquid on the planet, and a different velocity of liquidity needs for recipients.
In a different use case that uses stablecoins there are no price fluctuations and no index price negotiations involved.
Its been more convenient for some of our non-US businesses because it is difficult for banks to open bank accounts when the beneficial signers are Americans. This is due to FATCA and the high compliance burden for non-US banks, as well as FBAR filings for the US person. But the whole concept of bank accounts have been leapfrogged and international commerce continues unabated.
Ah, so unlike the person using it for savings that you're replying to, you're basically just paying someone for the overhead of getting that money to a real bank account, through a novelty payment mechanism, to avoid regulators.
I mean, that's a step up, at least. Good luck with FATCA Mk II, Cryptocurrency Edition.
we'll comply with any applicable regulation. if we have to start filing FBAR's for on-chain or off-chain custodial cryptocurrency holdings we'll do it, while also seeing if there is an applicable exemption, while also having our lawyers write to the Treasury during the comment period to suggest they not pursue this route