[AUDIENCE] I'm interested in bitcoin and cryptocurrencies as a store of [value].
I am wondering what ideas you have about [cryptocurrencies as a store of value],
[versus] putting it to work, such as trading, mining pools, things like that. Do you put your bitcoin to work?
[ANDREAS] No, I don't. That's one of the challenges with using this [technology] as an investment.
There is a big difference between store-of-value and investment.
Something is characterised as an investment if it has yield, if it generates some kind of return.
Maybe that's dividends in stocks, an interest payment in bonds, or something else like that.
If you have real-estate, you get payments from renters and you have some kind of yield, of re-investment.
You are essentially parking your money and for a low amount of risk, you have a continuous return
without eroding the capital.
It is difficult to do that with cryptocurrency.
Part of the reason it's difficult: you [may] want to store this long-term, but because it is a digital asset,
it's very easy for someone to steal [if the keys are stored] in an online system.
I have a small amount of bitcoin that is in freezing-cold storage. [Laughter]
In order for it to be in freezing-cold storage, it doesn't move; it doesn't get used for things [like trading].
One of the interesting things about Lighting Network is, if you are already running a Bitcoin full node,
which costs some money, [you can] run a Lightning node on top of it and actually collect some money in fees,
by parking a small amount of bitcoin [and creating] payment channels for others [to route through].
Just by routing payments through your Lightning node, you can earn small amounts of fees.
This is an interesting way to "put bitcoin to work."
But it adds risks, [since that] money is in an online hot wallet and can be stolen.
For most people today, the real "investment" or "yield" for these cryptocurrencies as a store-of-value is simple:
They're not printing a lot more of them.
If you "park" fiat, you need a willing partner.
You need a central bank that has [a primary mission of turning] the national currency into shit.
If they do that, then your cryptocurrency appreciates in value versus the national currency they are debasing.
Fortunately, every single central bank in the world is currently in this race to turn national currencies to shit.
Simultaneously! So all you have to do is HODL. [Laughter] And that is the ultimate return.
That doesn't mean bitcoin is an investment scheme. It's certainly not a get-rich-quick scheme.
I want to caution people. When you talk to others about this, make sure you emphasize the fact that...
this is a technology.
Its primary advantage is creating systems of money that don't concentrate power in the hands of the few.
That is the purpose. In the process, it is not a get-rich-quick scheme.
In fact, you can lose a lot of money by making some foolish decisions.
If you're not technically adept, you can lose money because it gets stolen from you [through a hack],
because you don't know to use hardware wallets.
There's all kinds of traps on the way.
It's a get-free scheme. Get free, don't get rich.
[Applause]