I bought bitcoin, I hate it, I think conceptually it’s really dumb, but the first rule of investment is to diversify. I just can’t ignore the fact that it’s a store of value like gold it is very bizarre why it is prioritized, but it is.
That does not mean buy anything. Intentionality matters. Diversification is a risk mitigation strategy, but holding bitcoin increases a portfolio’s risk. So if you want to diversify to reduce risk, purchasing bitcoin is the exact opposite of what you want to do.
Like, it's valid to point to its historical volatility, but it struck me as intellectually dishonest to say it's been (historically) risky without also acknowledging that holders have (historically) been well-rewarded for their risk appetite. High Sharpe ratio, etc.
It's not even like gambling on an external event like whether a horse wins -- it's betting on how other people are betting.
There is absolutely no reasonable expectation that its value will increase over time. There's no reasonable expectation of anything because it has no demand-side fundamentals whatsoever.
How is this any different to any other security? There's speculation in all markets.
If stocks get too expensive or too cheap from what people's estimation of that present value is, we know a correction will come at some point. It always does.
But with crypto, there's utterly on sense of "too expensive" or "too cheap" or "correction". It's just betting on betting.
Regular securities are fundamental value plus limited speculation. Crypto is purely speculation that is unbounded. Two totally different things.
Crypto valuation is based on the greater fool theory and one day you will run out of fools.