LM portfolio as at 15/03/2024:
| Code | Sector | Date Bought | Cost | Value | Gain/Loss |
|---|---|---|---|---|---|
| LM055 LM055-2 LM055-3 |
General Financial | 11/01/2023 02/05/2023 20/12/2023 |
£3850 | £5380 | 39.82% |
| LM058 LM058-2 |
Support Services | 17/01/2023 20/07/2023 |
£2540 | £2820 | 11.19% |
| LM061 LM061-2 LM061-3 |
Aerospace & Defense | 20/02/2023 13/10/2023 08/02/2024 |
£3820 | £4680 | 22.41% |
| LM071 LM071-2 LM071-3 |
Construction & Materials | 24/07/2023 22/09/2023 29/01/2024 |
£3840 | £4960 | 29.22% |
| LM075 | Equity Investment Instruments | 02/01/2024 | £1270 | £1130 | (10.77%) |
| LM076 | No Specific Industry | 03/01/2024 | £1270 | £1190 | (6.36%) |
| LM077 | Electronic & Electrical Equipment | 03/01/2024 | £1270 | £1120 | (11.76%) |
| LM078 | Banks | 03/01/2024 | £1270 | £1310 | 3.09% |
| LM079 | No Specific Industry | 22/02/2024 | £1270 | £1220 | (3.72%) |
| LM080 | Media | 27/02/2024 | £1290 | £1270 | (1.36%) |
The LM portfolio hit another new all-time high on Friday and long may it continue. Since the last update there have been 2 new additions - LM079 and LM080.
Also, there has been significant movement in the crypto-currency markets. Specifically, Bitcoin reached a new all-time high a few days ago when at one point it was "worth" $73,798.25.
Since then it has dropped down slightly and is currently around $68k.
I sold off the small amount of Bitcoin that I had many months ago but I do like to keep track of the price as, to tell the truth, I find the whole thing baffling. There are thousands, maybe millions, of people around the world buying large amounts of crypto using REAL MONEY. They are swapping their hard-earned dollars, pounds, euros and so on for what are basically strings of characters on a computer.
It's fascinating to watch as an outsider with no financial interest. And, as if the sudden BTC move from $50k to $70k+ in just a month wasn't a sign of a bubble, the sheer volume of posts about Bitcoin and other crypto-currencies on Reddit pretty much confirms it.
Not to mention the WhatsApp groups I'm in with friends:
I'm just putting everything I can in it at the min so when the bull run arrives which is going to start in a few months I should be retiring. XRP, XLM are the main ones and I have a few other bags but they are long term. You need to be on this train boys. Plus the bitcoin halfing is happening this year
Sadly for my buddy "L" here, both Ripple (XRP) and Stellar (XLM) have barely moved during the sudden rise of other crypto coins like Bitcoin and Ether. Ripple is less than half its all-time high ($0.61 v $1.97) and Stellar is even further behind ($0.12 v $0.79).
When I bought Bitcoin I remember the process was reasonably simple - I got an account with CEX.io and then transferred a small amount of REAL MONEY from my pre-paid debit card to my CEX account. I then used their exchange to buy as much Bitcoin as my balance would allow.
Next I created a "paper wallet" from a script I found at bitaddress.org, sent the Bitcoin to this wallet, printed out the details and stored the piece of paper in my safe.
Years later when I decided to sell I think I did it via CEX again, although I can't find any records of it now. Doesn't really matter, the process was smooth and I sold all my holdings and received REAL MONEY in my bank account.
I do remember reading some startling accounts of ridiculously high fees back during the late 2017 Bitcoin price surge. One person remarked on Reddit that he had invested £100 and received what amounted to around £50 worth of Bitcoin. It was such a pathetic story - here's a beginner to the subject wanting to get involved so he doesn't miss out on the massive wealth he'll get from owning Bitcoin and he pretty much loses 50% immediately to fees.
To compound his misery the BTC price dropped from that $20k high very shortly afterwards.
In the early days Bitcoin was heralded as a new, brilliant transactional currency that people would be able to use instead of real money. It was going to solve all matter of problems that may or may not have actually existed.
Some businesses made a big deal of accepting Bitcoin as payment in the same way they would accept Visa or Mastercard. CEX, a high street 2nd hand shop in the UK, was one of the first to offer it as a payment method. They quietly dropped the facility around 6 years ago.
The vast majority of Bitcoin holders do not talk about using Bitcoin as an everyday currency. It has long since switched to being used purely for speculation - you buy Bitcoin to keep it long-term until you can sell it on for a much higher price to someone even dafter than you. The Greater Fool theory of investing.
Crypto investors know that Bitcoin always goes up if you hold it long enough. And its patterns repeat. See my friend L's comments about it; "when the bull run arrives which is going to start in a few months". He has no way of knowing when or if a bull market will come in crypto markets, but he expects it as previously there has been some upsurge in BTC prices around the time of a "halving".
I didn't say anything in the WhatsApp chat and neither did any of the other participants. Maybe some of them were also invested, who knows?
What I did do is read several threads on Reddit. Much as in late 2017 there is currently a lot of talk about the heights Bitcoin will eventually reach. Few commenters are sceptical, the vast majority talking about Bitcoin being worth hundreds of thousands of dollars. And that's also a funny thing - many people of these threads talk about "fiat" money and how the US dollar is being eroded and so on - but they always talk about Bitcoin's price in terms of dollars. Always.
The end game is to eventually swap your Bitcoin back into dollars, millions of dollars. The same currency whose value is apparently being eroded away...
There is also a lot of talk about something I never heard mentioned when I was a holder of BTC - the "UTXO" size.
Now I consider myself a reasonably intelligent person. A younger me managed to get two science degrees so I am used to reading and understanding some quite complex subjects. However, it's quite unsettling that I have read lots about it yet I still can't seem to work out what this UTXO concept is.
I am currently in r/BitcoinBeginners where someone says this: "the consensus on UTXO size is a minimum of 0.01 BTC". Other chime in with more information but further down the page someone sums up my thoughts "I DON'T KNOW ANYTHING you guys are talking about".
So the dream of Bitcoin talking over as a transactional currency is long gone and everything about it as a technology seems to have only become more complicated over time. The fees were typically a few cents when you made a transfer back in the mid 2010s but now it seems you have to start learning about UTXOs, whatever they are, just to avoid losing a lot of your investment in charges for moving it around.
The main losers in this will, as always, be the late entrants. I can't see my mate L ever making enough money to retire. I know he has been holding these crypto currencies for a couple of years so I imagine he is still underwater but he is obviously expecting Ripple and Stellar to explode in value from where they are at the moment.
I can't see it happening.
For coins like this to move from being worth less than one dollar to $5+ would mean their market caps being far more ridiculous than they currently are and for that to happen you need more and more people to buy in. Once the buyers dry up the coin will start to fall in value and then as more and more holders give up and sell, the price will shrink to unthinkably low levels.
And that's for those who can work out what's going on in the first place and avoid losing their coins to scams or misplaced private keys, laptop failures or exchanges collapsing.
Tulip trading didn't make much sense but as long as everyone continued to believe that they were worth fortunes the market held up. Eventually once sentiment changed it collapsed and these strings of characters will at some point too.
Two books I can recommend on the subject:
BitCon: The Naked Truth About Bitcoin by Jeffrey Robinson - I'm re-reading this one at the moment after first buying it back in 2014. As you can tell from the title it's a sceptical view of Bitcoin and although it didn't get everything right, a lot of the viewpoints turned out to be valid. At one point he does make fun of a Bitcoin investor claiming that 1 BTC will eventually be worth $50,000. If only we knew!
Number Go Up: Inside Crypto’s Wild Rise and Staggering Fall by Zeke Faux - This one is far more recent and concentrates more on the recent NFT-mania. Talk about absurd, some pictures of cartoon monkeys were going for ridiculous amounts - I had no idea. The world really did go mad for a while. The author also investigates Tether, the US dollar stablecoin. Left me wondering whether the catalyst for a collapse in crypto will be the failure of a stablecoin.