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Comment by cwkoss | Hacker News Reader

Been following cryptocurrency for almost a decade now. I would generalize that XRP is an asset that is primarily purchased by speculators with sour grapes that they missed <$1 Bitcoins, and hope to see the same sort of returns despite the significant differences in technology and organizational structure.

I don't feel like there is much 'smart money' investing in XRP, so I think increased regulatory oversight is probably beneficial here.

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Exactly. I'm "the Bitcoin guy" in my circle as I invested very early, so many friends seek advice and almost every one has the exact logic you mentioned.

Which is why maybe it’s a good investment? I always buy cheap stocks because I know people feel like it’s more affordable, and has potential for larger returns, even if it ‘s not true.

The dollar price of a single unit of any tradable security-like thing is completely arbitrary: market cap, market depth and inherent value are all that really matter.

Cheaper units are almost certainly not indicative of something being a better investment, I'd say the opposite is more often true: ex. penny stocks or any of the long-tail cryptocurrencies that trade at fractions of a penny.

I mostly agree with what you're saying. But there is another aspect to this, based on the "greater fool" theory of investing. A lower-priced stock or cryptocurrency could be more likely to attract a larger number of unsophisticated buyers (Robinhood customers etc.)

Especially for low-priced cryptocurrency, the marketing pitch of "it's like bitcoin for $1" could be very appealing, if you spread it on Reddit and other forums.

So from a pump-and-dump perspective it may be more promising.

> Especially for low-priced cryptocurrency, the marketing pitch of "it's like bitcoin for $1" could be very appealing, if you spread it on Reddit and other forums.

If you went back a decade in time while you were at it, maybe. But there's been such a relentless tide of cryptocurrency-related scams being spammed on forum boards since Bitcoin hit popular awareness that the only thing I can think of that would be less appealing is someone trying to flog discount pharmaceuticals.

In cryptocurrencies, "market cap" is basically a complete fiction, and totally nonsensical.

Bitcoin is infinitely divisible. You can buy $50 of Bitcoin, if you want to invest $50. The "affordability" doesn't enter here.

It's not the affordability, it's the leverage.

A $1 increase on a $1 investment is already a 100% return. And it's much easier to imagine a coin to go from $1 to $2 then it is to go from $20k to $40k.

> Bitcoin is infinitely divisible

no. it goes down to 8 decimal places. (a satoshi)

Protecting greedy and ignorant people is good?

Everyone is greedy and ignorant to certain extent. Protecting people from being abused through trickery they don't have the smarts to defend themselves against (which, again, is everyone, for sufficiently smart trickery) is good.

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