The ‘set-and-forgetter’
I contacted a friend of mine today. In November last year I had advised him to invest in STEEM just before Hardfork 16.
With the reduction in inflation and relatively cheap price, STEEM seemed ripe for someone to invest. I told him a bit about the currency and he decided to invest a modest amount. He bought around 2350 STEEM for £250. He is not much of a blogger, so I set it up so that he followed my curation trail and earn more rewards.
He then did what I suggest a lot of people should do when it comes to crypto....
He got in then forgot about his investment.
Fast forward to today and he has almost 3000 STEEM worth around £2500.
I felt obliged to text him the good news.
“Now THAT’s what I’m talking about!” He replied.
To him, he had simply put some money in a speculative venture to find it had grown 1000% in 6 months. A fantastic return. He had no idea what had occurred in the interim.
The ‘micro-analyst’
Around the same time I told my friend about STEEM, I told my work colleague. Coincidently he also invested £250.
Being a colleague I see him pretty much every day. Once a week, we exchange tales of the joys and woes of investing. He’d tell me about his pension fund investing and I tell him about my speculation with Cryptocurrency. He’d get angst about single digit percentage falls over a period of months. I’d brush off triple digit daily swings.
My colleague was across the bear period of STEEM. The hardfork came and contrary to my prediction, the price went down. It kept going down. I couldn’t make him any promises of when it might up. He asked what I was doing. I was buying more STEEM. I could tell he thought I was crazy.
Then STEEM began to turn. Unfortunately for him, it turned just at a time when he needed some cash for to repair his roof. He asked how much his STEEM was worth. It had gone up to £300. But relative to Bitcoin, the STEEM price was pretty low.
“Great.” He said. He decided to cash out his STEEM, despite me expressing my reservations. However for him, a person used to 8-12% gains pa from Investment funds, a 20% return from shaky STEEM investment looked good.
He needed the cash asap so I bought his account for £300. Needless to say, I don’t mention how much his STEEM could have been worth now!
Opportunity knocks
So back to my friend, who is now sitting on £2500 worth of STEEM. After digesting the news, he text me back with the question I was dreading,
Should I invest more?
I know why he asked. Instead of £250, I’m sure he could have easily have put in £5000 back in November. He was just dipping his toe in with £250. Had he put in £5k, his account would now be worth £50k. No small beer after being 6 month invested.
He also saw that, despite the parabolic rise in cryptocurrencies over the last couple of months, I’m only cashing out a fraction of my STEEM portfolio. Maybe I’m onto something he should be in on? My friend isn’t the type to shirk in the face of an opportunity.
If he had probed deeper, he’d find out that I’d only cashed out some STEEM as a hedge against a correction. If STEEM were to fall again, I’d have cash to reinvest when it finds it new bottom.
Unsustainable bubble
I was honest in my text reply. I showed him the coin marketcap chart:
It’s a graphic illustration that we are in an unsustainable bubble. Yet what do I know… the market is still going up! Who is to say the crypto marketcap won’t balloon from $80bn to $150bn before ‘correcting’ to $100bn for a period of time then going again?
Looking specifically at the STEEM chart it could go either way:
It’s tempting to look at the July 2016 bubble and think STEEM could explode again, only this time without the crazy inflation to hold it back. Alternatively it could burst when the crypto bubble pops. Or it could dip a little and go sideways for a long time… who the fuck knows!
He’s tempted to ‘jump on board’ the crypto train, even if only to ‘disembark’ in a few weeks. We agreed to speak later.
I'm not sure what I’m going to say when he calls later.
The only advice I can give him, is that if he is going to buy STEEM (or any crypto) be prepared to let his money marinate for the long haul and also be prepared to lose it all. From my time in crypto, coins can go sideways (or down) for months (even a couple of years) before going parabolic in a matter of days. If he is going to invest in crypto at this moment, he should only invest in coins he personally believes in and even then look to price average his way in.
The non-naïve Believer
I believe in STEEM which is why I was buying all the way down to 6 cents. Even at 6 cents, people were posting, people were passionate, some believing in the currency… some despondent... but they cared enough to participate and engage with the blockchain. There are currencies with multi-million (and billion) marketcaps and nothing but tumbleweed in their forum and relatively few transactions in their blocks.
However despite my belief in STEEM, I’m not naïve about the crypto market. This is why I’m spreading risk and cashing out some crypto into fiat as it appears to overheat. If I’m wrong (like I’ve been on many occasions), I’ll cash out a bit more when it goes up more. If it corrects, I’ll be there to pick up some more crypto on the cheap. This approach works for me.
I think I’ll tell my friend, if nothing else have a strategy for buying, selling and holding. I don’t know whether STEEM is going up to $2 billion within two month or down $20 million. However having a clear idea of what you’ll do in either scenario will stand you in good stead!
Thanks for reading!
Disclaimer: none of this should be taken to be trading or investment advice... just random musings from a complete stranger online!
Crypto is way, way too risky to give advice to anyone, even family members.
Everytime I hesitated to advice someone close, the price goes higher :S
Everytime i hesitate to put more money in, the price goes higher =(
Yep... however it's difficult when they hear about the returns and are willing to take the risk. I just try to ensure they take full ownership of their own decisions and understand the level of risk.
I think you can share your own personal experiences - but shouldn't call it advice. Make sure the person you're talking to knows they could lose everything (like the author of this post warned). Then again, I'll never understand people who just blindly through their money into stuff - especially in the crypto world.
You can't call it blindly. People do research and analyse. Some people spend on cars, gambling, drugs. You can only loos money with those. In crypto you can also win. Some will win big time. And some will also loose, for sure.Look at @kyriacos comment bellow.
Couldn't agree more.
other than telling them to be involved with it in some way
You mean "too risky"
See my article on the three twos.
Thanks. My English is still not good enough.
Advice is always risky.
When money is involved even more.
Steem is so undervalued, that in a year or two early birds like us, will be shitting gold bricks and not even realize it.
I take it with diamonds 😜
Lol... I hope so! Nice pic!!
LLLOOOLL, love the art work
Very well said. Steem is still way undervalued in my opinion relative to the tech and how others have been doing in market cap lately.
Its always nice to have made some friends invest and them seeing interest in not just investing more but also using the site!
One of my proudest moments was when I just in time made it clear for a friend not to invest 5k into Onecoin and instead look at open-source currencies. He got interested in Ethereum and got in at 1$, he still sends me messages now and then thanking me for showing him the world of blockchain.
Hey @nanzo-scoop,
I just want to commend you on your phenomenal insights. When you returned from the Steemfest, you transformed into a whale by buying in low, believing in the potential and stability of the platform. I only wish I did the same. But you are now reaping in the serious rewards because of that and it honestly couldn't have happened to a nicer guy.
Incredible foresight, sir. And to think, this is only the beginning of a digital finance revolution. Also your strategy in cashing out small bits while retaining the majority of your portfolio is very wise indeed. What a setup!
I firmly believe we could be looking at expensive steem in the long run. An investment even at this stage may not be a bad thing if you weigh up the possible gains versus the losses. Maybe explain the risks to your friend while highlighting the crazy opportunities at the same time.
Inspiring and uplifting story, man. Keep Steemin' on!!! :)
Thanks for your kind words Ezzy. Wouldn't say I'm a whale yet, but I'm working on it! :) The hardest thing to do is buy low however no risk, no reward.
I agree it's the beginning with lots of twists in the road no doubt!
I am holding on as long as I can 😜 I'm not letting go off my hard earned STEEM, no no nooo🤑 BUT I had the same thoughts like you. Should I take some out now and jump back in later? Will see if I can trust my instincts. I am ready for Mars and hope Musk will take me on his shuttle because since I drove his Tesla, I know it's the same exciting emotion like riding the steemit wagon. What a ride so far!
I think best to let your friends decide for themselves.
Hey mammasitta! Hop you're doing great! :)
I say if you don't really need the money ASAP then it doesn't hurt to just sit on it and wait for the price to increase. Because I honestly think that's where it's headed over time. Way, way up.... And you already have a really good amount saved up. Thank about it! :)
@ezzy so nice to hear from you and yes as I mentioned I will hold on tight and cuddle for a bit longer 😋
What's your preferred strategy for Steem, specifically? Is there a way you divide it up ( ie, 20% steem, 50% SBD, 30% Steem power - if so why/how? If you don't mind sharing , of course. And I promise not to hold you liable for your advice, errrrm, opinion lol
The current wave is certainly going to crash at some point. Just looking at the list of coinmarketcap currencies, almost every single one in the top 200 have seen double digit or better percentage growth. The problem is that many of these altcoins offer nothing unique or innovative to the world of cryptocurrencies. Because of that I can only assume that much of the growth is due to wild speculation being driven by pump and dumps.
That's not to say that the interest and growth in cryptocurrencies is completely false. There really are a number of new and exciting ideas (such as steem) that are picking up steam (heh, get it?). Bitcoin will hold steady when the drop comes, as will Ethereum and a handful of other popular coins. But I foresee a big drop in the rest. Long term however I would expect the innovative ideas to continue growing, even if there is a drop in the short term. Those that stick with it and don't get scared off will be rewarded.
As for advising others, I would tell them to diversify. Its almost impossible to know which ones will emerge as the real deal, so if you're going to invest do so with a number of choices. Don't put all of your eggs in one basket.
Nice Piece! Thanks nanzo-scoop. I tweeted it
Disclaimer: I am just a bot trying to be helpful.
In times of a bubble and crisis Steem will be one of the most protected currencies due to its Steem Power. Those who believe in it will stay and we might find more people looking for opportunities as they will become few and far between.
In the near term our market cap could go ten times what it is now before mass media starts taking note and people start throwing their money in.
This is a social platform, like no other. It will be insulated by short term crashes as people keep blogging and posting in their communities.
Im HODLING to the MOOOON!
Really good article. There's some really sound advice throughout. Everything is so overbought and overvalued right now it can get really confusing deciding where to put your money. Finding value today is harder than ever and all the time trusted fundamental analytics don't seem to work in today's marketplace. The reason I'm still here after a week is because in my mind, I've found something of value. Steemit's community I believe is what set's it apart and provides the currency with incredible staying power. I also think it was a great idea to lock up the Steam Power for 2 years to protect against sell offs and provide as much stability as possible. This isn't a fad, the community here disproves that and while I do believe we're in a bubble and might very well be headed for a blow off top, the Steam Power structure and community will allow this currency to survive long term and prosper. Don't invest more than you can lose and dollar cost average every week/month. It's the oldest of all investment advice and in my humble opinion still the best.
Giving advice is one, talking about it is something else.. If people come to me asking how Bitcoin and cryptocurrencies work, i tell them, I think it is the future, but that they have to keep in mind that these currencies fluctuate. Don't invest with money you can not afford to lose..
I'm seeing a 1 trillion dollar total market cap test within a year..
i am a set it and forget kinda guy, spend 100.00( less than what most people spend on dinner and drinks on in a night) and just let it ride, you will screw youreslf everytime if you become obsessed with your (bet) accept that you might lose the money and then don,t fret about it.
A while ago I Tried to tell my friends about steem and about crypto. They looked at me like i'm crazy.
Guess who pinged me this week to ask about that Bitcoin or Ethereum thing and why it's worth as much as it is.. well, three of my friends. One has already created his steem account :)
#steemOn brothers, to the moon and beyond!
maybe its time to flip a coin and but silver
Well, this is a desperate step done by you and your friends, you can convince your friend until he wants to spend € 250, this is really a great result and proven he can take advantage and he can restore the roof of his damaged house.
Your friends are very lucky to get to know you, do not let the opportunity for the time now to invest and invite your friends again the same. I'm sure there will be big profits.
This is one story or a good thought, I really enjoy reading your post time.
Thank you for sharing an interesting story for today, good luck always on your side @nanzo-scoop
Way to hang in there when the times where tough, following ya now!
Well, with every rise there is a fall. This is a chance to make a big profit, but you have to be ready to lose that money anyway.
Wow, I love to hear from the people who invested like this. Holding then finding out they made a packet, fantastic!
Only up from here.
so lets say you took 1000.00 dollars and bought some of the emerging cryptos in 50.00 blocks and just let it ride, the law of averages will work in your favor, or lets say you buy 1 amazon stock at 971.00 dollars and over the course of a year it gained 100.00 a share, what pays you more? same risk because most of the stocks in that range are crazily overvalued and the fundamentals just aren t there.
Hey darling!! long time!!! and amazing article, i was just wondering what to do myself!! and i think probably best bet is to leave it for now and see what happens! what are you thinking of doing ?
Hey! Long time indeed... I've seen your Supper Club posts, it's tempting to gate crash! :)
I'm in Steem for the long haul. I'll take some profit but will hold the majority at these prices.
yeah i think i will do the same!! and yes please come this saturday!! i only have 4 seats left and its going to be a 6 course russian menu!! :)) come with a friend :))) will be good to see you!
As more investors continue to enter the wonderful world of crypto currency the value of specifically coins with purpose, good infrastructure and transparency will continue to perform with jaw dropping growth in value.
Go Steemit!
Good post, thank you!
As I am hungry for every info I can find about cryptocurrency and investments I really like your post! Thanx and thumbs up!
Let me relate a true story to you, My brother is a computer guru, he manages the entire computer system for a very large very well known state, he has worked and does work directly with the treasuere for this state, about 5 years ago they needed a new programmer and this very overqualified guy comes and and applies( this guy was like NASA level) and they had an obscure discussion about bitcoin, afterwords the treasurer for this state asked my brothers advice about the emergence of this currency, in my brothers opinion is was a fad and wasnt really an area of concern(the state just enacted legislation to allow and work with blockchain tech), so now for the rest of the story, about 2 wks ago i called my brother and was asking him about what he knew about crypto and ehtereum, i told him i was going to buy quite a bit of eth i think it was around 80 dollars a share, he advised against it , i did it anyway. so i called him and told him what i had accomplished he is still dead set against it as he was when bitcoin was around .30 cents a share, moral of the story is invest what you can afford to lose, follow your plan. you only have to have one hit single to be a rock star these days, but you make nothing sitting on the sidelines.
This is a hell of a great post. Thanks 👨
Steem is a great platform and block chain is the shiz!!!!!!!
I post the latest in the meme war and articles on the market, economy, goldsilver crypto!!!!
Follow me if you dare!!!!!!!!!!!
Good post, I am definitely a set and forgetter, if it goes up great, if it goes down then ill sit on my coins and wait for something to happen.
What a great post. A joy to read. I can relate. Everything was just easier to recommend when it was just 20 cents or lower. I recommend many to buy BTC and Ethereum and only one did at $5 (ethereum). He still got his. And is pleased as you can imagine.
Now I can;t recommend this anymore. The price is too high for me to feel comfortable doing so.
I have seen crypto crash many times and that hockey stick graph I don't like much either. From all the coins I think steem has the best potential because it has such a great community of normal people and the tech is great. But I'm pretty sure if there is a big crash in crypto Steem won't be spared.
I already prepared my mind for this day in case it happens.
It doesn;t mean I don't believe STEEM is amazing. I believe it can go up to $10 but it will be a very bumpy ride.
I can totally relate to your article, @nanzo-scoop! Only last year, I was telling all my friends about Steemit and how it would change their lives if they joined. Of course, they didn't and returned zero interest. Now my account has risen so much and they are all clamouring over me to teach them how to buy in! Lol, things like this need a solid vision which you had and are doing so well from. It's all about taking the risk and giving it a shot.
Such a great article! Thank you. You brought back so many memories, haha! :)
Thanks, that was a good read. I'm thinking to invest a little Bit coin I have into Steem power.
upvote and rs for you...
Most of my family is already in crypto, but there are some I wouldn't even mention it to for fear of being wrong...
Is bitcoin in a bubble. Will it drasticly fall.
That's a great story!! I enjoyed the read!
Yes, smartly invest more.
Great post, read it with pleasure!
Great post...upvoted and followed
I'm into crypto currencies only since few months, but i'm addicted. Newbie to steemit and enjoy a lot! I trust in steem!
Fantastic article @nanzo-scoop I will be referencing it in a post soon! Thank you for putting this together!
Yes, that's pretty much how I do things, too. I'm a non-naive believer, too ;)
Nice post
https://steemit.com/cryptocurrency/@longnshort/bitcoin-and-eth-price-action-updates-and-ongoing-thoughts
Hi nanzo-scoop, great article. I've written a fair bit about this lately. I recommended to friend back in march to put some money on Augur. This was late march. He put his whole bonus on it (around €10k) and has since made a very nice return. However, like your story, he forgot about it and I had to inform him of the huge gain he had made. I think if he had micro managed it he would have sold his position when the return was +30%. It's now well over 200%. I think the buy, hold and memory zap seems to be the best strategy right now 😀
I literally have no money to invest so up until now this has been a non-issue for me which is why I was so late to join in on the crypto explosion. But this will be something I need to know more about as I finally have a way to earn crypto without having to invest in it. Once I have a substantial amount of STEEM I will need to think about what I want to do with it, so I appreciate the perspective.
when I see the applications and companies.... I see $1000+ ETH and +10,000 BTC....so I guess on pullbacks if you have some money :-)
I followed and upvoted you. Please follow and upvote back. Thanks!
Great discussion point. Thanks for bringing this to my attention. You read this stories about people selling their cars to buy cryptos and I think to myself: Don't invest money you don't have. We do need more indept investment analysis. Does anyone know about: https://www.coincheckup.com This site did all the research for you. It's truly amazing.