The potential for more or less of something

Over the last couple years and with a select group of colleagues, I have been that annoying crypto guy that talks about the potential of blockchain and digital assets, regardless of how crazy I sound. However, I had never directly suggested to anyone to actually buy, but I had suggested to everyone to have a look at buying. However, last year in February and March I broke that rule by suggesting to a couple of the people that if they are going to buy, it would be a good time. I figured, this is the dip that most of the mainstream users will be glad they got a hold of. None of them bought.

Some might remember at that time, me speaking of a friend of mine who had a large chunk to invest after the sale of a house and I had suggested he take 10 percent of it and get a position to hold. It would have been around about 1 BTC at that time. He asked his investment advisor from his bank about the "what if crypto?" of it, and she laughed at him very hard. He put it into a fund with his bank and a week or so later, his investment had lost 30% due to the start of Covid-mania.

Back at that low, I was confident that Bitcoin was going to go up significantly within the next year, so for the people who bought in, they would make good gains. Even though we had just bought the house and had no money to spare, I even bought a couple hundred euros worth myself, just so I didn't miss out on it completely. I bought on the 10th of March (my birthday) at 7175€ and the 13th of March at 5300€ - That is about 6400 dollars - with the lowest point being about 5800. Close enough. While the amounts were small, I am glad I bought and held.

I am very wary about giving people any advice and my colleagues who have bought in the last 6 months or so asked why every second line is a caveat of "You make your own decisions" and "don't blame me if" - as they feel they know. As I said to them, it is a about experience. I have seen a lot of people blame others for "bad advice" that they followed, when the onus isn't actually on the advisor at all, especially in a social conversation.

"Caveat" literally means "beware" and in this case, it is buyer beware. Yet, I know the way people's emotions work and when they feel the sense of loss, they will look to deflect the blame away from themselves and onto another, so they don't have to take responsibility for the harm caused.

What is interesting, is that we were talking today about ups and downs and possible selling points and one was talking about selling out and then getting back in lower, but if for example it goes to fifty, he would lose x-amount. I corrected him. He is almost 500% up on his average buy price, so he would still be very much in the green - what he would be losing is the potential for gains, which means he isn't actually losing.

This seems like some kind of semantic trick, but we often hear people say "If I bought Bitcoin at...I would be rich!" But they didn't buy and even if they did, most wouldn't hold. I know I have said the same thing and done the same math, but "potential" doesn't amount to anything if not fulfilled. Like the potential to be great at something, most people waste it.

It is only when a person puts skin in the game that they have the possibility to capture some of that potential and turn it into something tangible - but no matter what it is, this requires risk exposure. A person can spend 10,000 hours at a piano perfecting their technique, it doesn't mean anyone will pay them to play. But, no one is going to pay to listen to the piano skills of a person who has only played for 10 hours. That time investment is the buy-in to have access to the skill and the potential of attracting an audience, but it comes with the loss of that time which could be spent doing other things, like going to the gym, writing on Hive or fucking a pretty woman.

Every movement takes finite energy to perform. If my friend had invested that 10% into Bitcoin he would be well and truly up, but that would have removed that 10% from his other investment. He also could have lost it completely and may still do - as the potential for loss in the future is there, considering the state of the global economy.

the potential for loss weighs heavy on our minds and it is interesting to think about how much potential people have lost in the last year. I know that I have lost a lot by being very conservative in my buys due to the needs of my life. How about all the others who saw that the new pair of 100€ jeans was more valuable than buying that Bitcoin back then? Sorry - a 500€ pair of jeans - A pair of jeans of the same value as a cheap, 50 inch 4K television. I hope they fit well.

But this is the thing about opportunity cost and why I am wary about giving anyone advice on what they should do, but I am still willing to suggest what they could do. It is about having the options and information available to make a better decision, but whenever there is a sense of loss, there will be the feeling of buyer's remorse and if we can make ourselves feel better by transferring the cost of the decision and blaming another, we will.

Who's fault is it that we aren't in a better position financially, or that we do not have the relationships we value? Who is to blame for our inability to fulfil our potential?

We can't control all of our conditions, but we do seem to have the ability to learn from our past errors in judgement. How many make sure that they have enough resources available to take advantage if an opportunity arises. How many keep repeating the same patterns of behavior over and over again, even if they don't work?

I suggested to my colleagues today that while they are excited about the financial aspects of crypto, what they could be doing is looking at the potential of the technologies themselves and becoming familiar with the industry. I am guessing that just like most people will not expose themselves to financial risk, most won't invest themselves into an a new industry that is yet to go mainstream. The potential is there, but they don't want to waste what they have today.

What is interesting is that I am not confident in giving people financial advice, but when it comes to gathering knowledge and developing skills to enhance potential - what is there for them to lose, but time that they could be doing other things - But probably aren't.

And I think that this is the thing when it comes to investing into potential of any kind, we as individuals make the decision if what we are considering is valuable enough to take the risk on. We are hardwired to be conservative in taking on risk of any kind, except the risk of not doing anything at all.

Our potential is not static, it will change based on the decisions we made earlier. Investing 100€ nine months ago means having 600€ in value now. Buying those jeans would mean having a pair of jeans that potentially get a comment from a friend saying they look nice, but ultimately, they will be thrown away without use. The time spent on Hive writing has the potential to earn, ease my mind and help me develop thoughts, but it also takes time away from whatever else I might be doing in the evening, watching TV, reading a book or spending time with my wife. But, nothing stops me splitting up my investment and diversifying.

Perhaps part of the issue is that people are more binary now, black and white, on or off, in or out, all or nothing. This opens up a lot of potential for high gains, but loses a lot of potential through lack of diversity. Regardless, to play the game requires skin in the game, otherwise you are just a spectator sitting on the sidelines.

Taraz [ Gen1: Hive ]