Ryan Daniel Moran states he does not invest in cryptocurrencies and would hesitate to call them assets. He argues cryptocurrencies are speculative rather than investments because they lack backing and produce no cash flow (unlike companies or real estate). He treats crypto as driven by buyer sentiment, compares it to gold/silver hedges (accepting a hedge rationale), and allows small speculative allocations in a portfolio but rejects treating crypto as a core, long-term investment.
Chapters
Foreign?
No, I don't. And I would hesitate to call any cryptocurrency an asset. We did a podcast on this with my friend Tom Kinoshanko where he argues that Bitcoin is an asset because he says that it is a piece of technology rather than just a fiat currency. I look at it a little bit differently where I say cryptocurrencies aren't backed by anything. Now some would say, well, name an asset that's backed by something. And I would say companies, real estate companies are backed by earnings. Real estate is backed by real estate. So these are things that I invest in. Cryptocurrencies have no cash flow and they're not backed in anything. So you are purely speculating on the hope that they will go up in value. That's not investing to me, that's gambling speculating. Now, if you want to have a piece of your portfolio reserved for either high risk, speculative trading, because this really isn't investing. If we're hoping something's going to go up in value, it's not really investing. We're speculating at that point. Investing means you're going to hold something for the long term because you are going to have some cash flow from that. That's how I look at it. Investing means cash flow. So no cryptocurrency pays dividends. No, cryptocurrency is profitable. It's not spitting out cash flow. So you're speculating. So if you want to have a small piece of your portfolio reserved for more risky investments, I do this. I do some options trading with a small piece of my portfolio, but I'm not investing in cryptocurrencies because they're not backed by anything. There's really no way to predict what is going to happen there. It's my opinion that it's mostly driven by buyer sentiment. So I won't touch them. They're completely speculative to me. There's no cash flow. So there's no reason for me to be investing or buying cryptocurrencies. I have heard the argument that some people buy them as a hedge in the same way that some will buy gold or silver. I buy silver. I, I just buy the silver etf. I don't hold physical silver. I think that's overblown and over marketed and unnecessary. But there are those who buy cryptocurrencies for the same reason that people buy hard precious metals. Because in the event of hyperinflation, those are the types of things that people will flock into and that will be a safe haven against inflation. Okay, I guess I could get behind that, if that's your reasoning. But don't act like it's investing. So don't act like it's a wise investment to have your a large percentage of your portfolio in an asset that isn't even real. You're speculating by going into cryptocurrencies. And that's why I won't touch them.
