[alert0]

Comparing cryptocurrency to real estate is laughable. With real estate you have either a place to live, reducing a real world expense (rent), or an income producing property. No matter how much you dress up cryptocurrencies as stocks, by using terms like market cap, you are not buying a share of an income producing asset. You're speculating on a digital collectible. You can speculate on real estate and stocks, but you can also invest in them.

[andrepd]

> If you buy an income producing property that's good because it is an income producing property.

Not sure I understand your reasoning there.

> You're speculating on a digital collectible.

And if you buy properties not for self-use you're speculating on a physical collectible. So?

[alert0]

First quote isn't exact, so I'm not sure what you're addressing.

If you buy properties not for self use, you can hold them indefinitely and have an income stream. If you buy a share of a company and hold it indefinitely you can have an income stream. There is no equivalent in cryptocurrencies. You buy it and hope you can sell at a later date for a higher price.

Investing versus speculation.

[galaxyLogic]

I agree. I think it's worth pointing out that investing in crypto-currencies is really no different from investing in any currency say Euro. And when you have money in a US bank-account you are (typically) "invested" in US Dollars. But see below, that really is not investment, but speculation.

Investing in a currency/cash is speculation in the sense that currency itself does not produce anything but its value can go up and down. Investing in a currency is like investing in roulette in casino, you may win and you may lose.

So, keeping your money in bank for ~0% interest really is gambling/speculation too.

But, from the point of view of the individual investor it does not matter if you are "investing" or "speculating". In both cases you may win and you may lose.

[muskox2]

Many people buy real estate and let it sit empty, to sell at a later date when the price increases. This is actually a destruction of value as the house is no longer being utilized for it's intended purpose.

[solosoyokaze]

They compared it to the appreciation of real estate, which is wildly divorced from real value. Real-estate prices in say, the Bay Area are driven by legislation and speculation. Not actual value. The move to remote works accelerates the discrepancy.

[clpm4j]

Isn't the value of a house what someone is willing to pay for it? There are still a lot of people buying homes in the Bay Area to live in. There are just a lot of rich people in the area, so they're willing to pay the price that the market is setting.

[solosoyokaze]

> Isn't the value of a house what someone is willing to pay for it?

This is why it's being compared to crypto currency. The parent comment I was responding to said it's not a fair comparison but "it's worth what someone is willing to pay for it" describes both.

[6gvONxR4sf7o]

Real estate prices in the Bay Area are also driven by the boatloads of money coming into the area and then not going back out. Our local money supply has gone way up. After all, when local worker salaries go so far up, why wouldn’t the price of goods they’re bidding for go up too?

[carom]

It isn't. If you look at residential income properties, they trade around the rents that they command, sometimes with some development potential sprinkled on top.