Will I too hoard Devcoins?

One thing that’s a little strange about paying attention to the cryptocoin exchange is that no matter what the price of my alt coin was a couple weeks ago or even a couple days ago, when I look at today’s exchange rate, it’s as if my brain forgets all about what I saw earlier and I assume the price I see right now is the price it will always be. This leads to some serious cognitive dissonance when I’m looking at a range of 61 to 68 sat for selling Devcoins and I know that I could have sold Devcoins just days ago for 100 sat. I even remember that I did sell Devcoins a few days ago for 100 sat!

This morning I’m staring at the buy orders and mentally calculating how many Devcoins I will need to sell in order to raise a Bitcoin. In the end I decided I’d just do what I always do when I want a Bitcoin, and that is to sell Devcoins. I’ve put in some sell orders because I’m hoping to get a better price than what I’m seeing on the buy side. If I can’t sell before that MintSpare IPO starts I may need to settle for lower. But I still need to decide for sure if I will invest in MintSpare. Must finish reading prospectus.

I’ve learned something about myself as an investor and it is this. I do not like simply hoarding coin. I like to have my crypto, whether it be Bitcoin or Devcoin, actually doing something–growing in some way. I’m disappointed by how few viable Devcoin denominated securities are out there; if there were more I would be putting way more Devcoin into them. A huge reason that more often than not I’m selling my Devcoins for Bitcoins is that I can then take those Bitcoins and make them grow. I can invest them into mining, I can invest them into a greater variety of stocks, and I can even lend them out. Finally I’ve found thanks to Camp BX that it is very easy to turn Bitcoins into fiat.

When I first got involved in Devcoin I had no experience of the price of Devcoins ever being higher than 85 sat. Then when I first started selling them the price kept going down until it finally bottomed out at around 14 sat on mcxNOW, though I’m not sure it ever got that low on Vircurex. Now that I have been around for a while, I have seen the price of Devcoin as high as 200 sat and I have plenty of experience with selling Devcoins at well over 100 sat. With this experience under my belt it makes a lot less sense to just dump them at 61 sat just because I want to buy another Bitcoin. That’s the part of my brain that remembers that the price can be higher, the part that hopes that the price will be higher again soon.

Then there’s the part that believes it will not get higher any time soon, certainly not in time for me to participate in MintSpare’s IPO. Related to that is the part that believes it will drop substantially more before it goes back up. This is the part I need to listen to when it comes to taking profits on earnings. That’s why I sell the portion designated for household income at whatever the market rate is. It’s true that in some cases if I’d held out I’d have gotten a better deal, but it’s also true that in other cases holding out costs because the price drops rather than goes up. If I just sell at market then I figure it will all average out over time. It’s the same principle of dollar cost averaging that people making monthly deposits into mutual funds adhere to.

I realize now that the people who were hoarding Devcoins when I first joined and who continue to do so are the ones who are paying more attention to the part of their brain that hopes and believes the price will be much higher in the future. For them the Devcoins themselves are the long term investment. Now that I’ve seen the price of Devcoins much higher than it is at this moment, that strategy makes more sense to me.

This morning I decided to adjust my Devtome earnings allocations to half livelihood (household income) and half investment. I will continue to cash out the household income earnings at whatever the market rate it. I will further divide my investment earnings so that half continue to get invested as is my current practice. Sometimes I buy Devcoin-denominated securities but more often than not I trade those into Bitcoins and then invest the Bitcoins. Lately my favorite investment has been cloud mining, but I also enjoy lending and I own some stocks. The other half of my investment allocation will be hoarding, plain and simple.

Cryptsy is a great site for hoarding. It is a trading platform, and it has the most comprehensive collection of alt coins that I know of. Cryptsy is usually the first place a new alt coin gets listed and it will stay there until the coin disintegrates from lack of mining interest (which does happen). But let’s suppose you find a faucet for one of these new alt coins, but you don’t want to install yet another wallet on your PC. All you have to do is find that alt coin on Cryptsy, generate your own deposit address for that coin and then use it. Your coins will be as secure as the website itself is, and Cryptsy has a great reputation.

Yesterday I checked to see how much it costs to withdraw Devcoins from my Cryptsy account, and I was delighted to learn that it costs the exact same amount as it costs to send Devcoins out from my PC wallet–one DVC. So I decided that one fourth of my Devtome earnings will be sent to my Cryptsy address and will just sit there until whatever it is that happens which causes hoarders to finally release happens, most likely a truly exponential explosion in value. It turns out that it also costs the same amount to withdraw Bitcoin as it costs to send them out from my PC wallet as well. One thing about Cryptsy is that unlike many other sites which provide wallet services, they are not trying to profit from users’ transactions into or out of their accounts.

I sent my first Devcoins to my Cryptsy account about an hour ago. It was a small deposit–I’m still in the midst of the Round 30 payouts which for me have been thin–but hopefully the first of many. Since I don’t actually use Cryptsy for trading, mainly because I really am not a trader, I’m not likely to log in very often and be tempted to dig into my stash. I may even enable 2 factor authentication on my Cryptsy account just to make it even less convenient for me to access.

I believe I will do the same thing with my Bitcoin earnings–cash out half as soon as I earn them, invest a quarter, and send the last quarter to Cryptsy to hoard. I have been involved in Bitcoin long enough to have seen one order of magnitude increase–I saw it go from less than $100 apiece to over $1000. We are still in the very early stages of Bitcoin which means that its value is only beginning to be realized. Bitcoin could easily climb to $10,000, $100,000, or even $1,000,000 apiece. While I do not want to hold out all my Bitcoins for that theoretical possibility, and I definitely want to take profits all along the way, it makes a lot of sense to hold out some Bitcoins for that possibility. Off to Cryptsy those Bitcoins will go for now. If RealSolid ever gets his act together and releases his new version of mcxNOW, I may actually send my Bitcoin there since they earn a small rate of return there; I may also send them to Vircurex for the same reason. The downside of this is that both sites charge much more for withdrawals which may make the small “interest” earnings less important. But in any case I will also be hoarding Bitcoin.

So yes, from now on I too will hoard Devcoins.

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