But he is using BTC as an intermediary. He can just get it 2 minutes before his cannabis puchase and not hold it while he doesn't want to buy weed.
Because of convenience and transaction costs, he holds a small amount. If many people do that, then there is that residual value. It is just like one Facebook account might seem to have zero value. The user can always delete it and start a new account. But in practice they don't. Then if many people have it, it has a network effect which has value, like Visa or Mastercard.
That's an excellent way to think about it. Let's say there are 30 people in each city with a population over 1 million that have circumstances requiring BTC like your uncle. Let's say there are 1000 such cities for a total population of at least 100 million. That means there are 30,000 people in the world. Some hand-wavy calculations later (0.03% of world GDP), that is about $600 billion annually in BTC transactions. Given that there will only ever be 21 million BTC, that gives a top-line value of $28K. The problem, of course, is that the numbers I have chosen are extremely favorable to BTC. So what you need is the BTC version of the Drake equation so you can futz with the values and see at what point BTC isn't complete horseshit.
Cryptocurrencies as a vehicle of speculation is one the best (if not the BEST). I got into cryptos in 2013 and bitcoin went up to over $1200 and crashed down to less than $200. There's no need to have perfect timing! Bitcoin then went to $20,000, then crashed down to less than $4,000, this year alone it went to $14,000, then now back down to $8700 If you can't make money in that kind of volatility, you should not be in Elite Trader
Some of the original blocks of BTC have never been chipped away since initial creation. I find that behavior highly unusual -- when it reached a high valuation, founders like Bill Gates and all the other startups have sold even a small amount. For that reason, I think those blocks are lost forever. Or the founder of bitcoin has bigger balls than Bill Gates or Zuckerburg! I don't have a position, but I think I would buy happily at $800. That is, bitcoin is worth $10bn in total market cap. Of course, if PayPal or Square drops below that, I might revisit. We are traders of course. I see a possibility that somehow it collaspes to $0 but I won't bet on it. If I WERE short here at $8k, I would surely take profits at $800. I would love to hear the view of people who think it is worth $0 -- if you had money on it, would you not exit your short at $800?
This is a reasonable perspective. I just wouldn't be religious about BTC being our savior from rent seeking bureaucrats and others who were bullied in school.
Yes, he got lucky, but has really bad risk management. So why wouldn't he sell there? Coming from $300k, $27M is already enough to never have to work again and live a stress-free life of leisure. Or even sell half. Then you'll still have $13.5M which could either be saved or diversified instead of having entire worth on one bet.