Episode Overview

Podcast: Money For the Rest of Us
Host: J. David Stein
Episode: Hoarding, FOMO, and Zcash: A Private Bitcoin
Date: October 29, 2025

In this episode, David Stein explores the psychological and practical sides of "hoarding" in personal finance, the influence of Fear of Missing Out (FOMO) on investment decisions, and takes a fresh look at Zcash—a cryptocurrency focused on privacy. He shares a personal story involving a knowledgeable friend’s substantial Zcash investment, reflects on lessons learned, and offers a critical comparison between crypto assets and traditional investment vehicles like stocks and gold.

Key Discussion Points and Insights

1. The Context of Crypto and Market Comparisons

• Stein recounts his initial Zcash investment—bought in 2018, ultimately locked up due to the Voyager bankruptcy, and partially recovered but at a loss. This sets the stage for a discussion on speculation versus investment.
  • "I purchased four or five Zcash coins... in the summer of 2018, paid around $150 or so per coin." (02:10)
• Crypto market size compared: The entire crypto universe ($3.8 trillion) is dwarfed by single companies like Nvidia ($4.7 trillion), Microsoft, and Apple ($4 trillion each), and especially by the US stock market ($68 trillion, Wilshire 5000).
  • "The total market capitalization of the crypto universe is about $3.8 trillion... Nvidia's market cap is greater…" (04:00)
• Hoarding defined: Stein distinguishes hoarding (the act of accumulating assets like gold, crypto, etc., for protection) from investing (allocating resources with expectations of positive returns based on cash flow and economic productivity).

2. Hoarding vs. Investing & Speculation

• Scarcity as a driver: The logic for hoarding assets like gold, Bitcoin, and Zcash is their supply increases more slowly than fiat currency.
• Investing vs. speculation:
  • "Investing is when we are confident there will be a positive return... because there's some cash flow." (07:45)
  • "Gold, Bitcoin and zcash are not growing the economic pie. They're just there to be hoarded, to provide a layer of protection." (08:30)
• Crypto as digital gold: These cryptocurrencies are not productive assets, but rather means of transferring value and potential stores of wealth—if trust in the network persists.

3. The Psychology of FOMO and Asset Attachment

• Personal anecdote: Stein tells the story of his crypto-savvy friend, who allocated 20% of his net worth to Zcash in September at $50/ZEC, watched it quickly surge to $250, but admits to being guilty of not taking profits soon enough.
  • "He described it as falling in love with your assets because you can see the potential growth." (09:04)
• FOMO in action: Stein himself buys Zcash after seeing his friend's gains, acknowledging this was driven by FOMO rather than research or fundamental analysis.
  • "I bought zcash out of fomo. And then this week I started looking at it again to see what makes zcash unique." (10:19)

4. Zcash: What Makes it Unique? (Privacy Feature)

• Zcash overview: Launched in 2016, built on Bitcoin’s protocol but adds strong privacy protections.
  • "It was founded in 2016. It was built on the original Bitcoin protocol, but they added an additional layer for privacy." (12:39)
• Public vs. private addresses:
  • T-addresses: Recognizable, public, and transparent like Bitcoin.
  • Z-addresses: Shielded and private, using zero-knowledge SNARK proofs for confidential transactions.
  • "They have Z addresses which are private, and they have T addresses which work just like Bitcoin. They're publicly visible. But if you choose to engage in a private transaction, it's encrypted." (13:25)
• Implications for regulation and law enforcement: Privacy is a double-edged sword—valuable for individual rights, but a concern for governments seeking to curb illicit activity.
  • "The privacy aspect is also one of the risks. Governments don't like digital transactions to be private, so there's some regulatory risk there." (15:15)
• Illicit activity context: Only 0.4% of total crypto volume in 2024 was associated with illicit activity, far smaller than public perception.
  • "Illicit volume, they estimate was $45 billion. So only 0.4% of crypto transactions were illicit activity." (16:45)

5. Risk, Allocation, and the “Availability Heuristic”

• Availability heuristic: Investors tend to mentally overstate the importance of assets that come easily to mind (like Bitcoin or gold), which distorts prudent asset allocation.
  • "We tend to put more weight on things that come easily to mind... Their importance in the economy... for gold and cryptocurrency isn't that great." (18:45)
• Portfolio construction advice:
  • Hoarding/speculative assets like gold and crypto should be capped (he keeps them at no more than 20%).
  • Primary allocation should go to generative assets—stocks and bonds—that drive innovation and cash flow.
  • "Put the bulk of your assets in areas that generate cash flow and benefit from innovation. The probability there of building wealth is just greater." (21:20)
• Taking profits: Critical to manage emotional attachment and FOMO—take profits as assets appreciate instead of hoping for perpetual gains.

Notable Quotes & Memorable Moments

• On speculation and loss:
  "These are speculations. I only put enough in that I'm willing to lose it all. And for some... I've effectively lost it all." — David Stein (03:09)
• On falling for hype and FOMO:
  "It was the fear of missing out... I bought zcash out of fomo. And then this week I started looking at it again..." — David Stein (10:17)
• On taking profits:
  "I had encouraged him to take some profits due to these major expenses. And Zcash was at $350 per coin. Something was driving it." — David Stein (10:53)
• On government and crypto privacy:
  "The privacy aspect is also one of the risks. Governments don't like digital transactions to be private, so there's some regulatory risk there..." — David Stein (15:09)
• On perspective and market relevance:
  "We look at the size of those markets... they're tiny... in this grand scheme of things for gold and cryptocurrency isn't that great." — David Stein (18:58)
• On emotion and prudent investing:
  "We get emotional as investors, but we can't let it drive our decisions. Can't let the availability heuristic to drive our decisions. We have to step back, distinguish between investing and speculating, keep hoarding in its proper place..." — David Stein (22:41)

Important Segment Timestamps

• (00:00–04:30) — Introduction, personal Zcash investment history, and market size context
• (06:30–09:00) — Defining hoarding vs. investing vs. speculation; crypto/stock market comparison
• (09:04–10:53) — FOMO, friend’s story, and emotional decision-making in investing (“falling in love with your assets”)
• (12:39–16:30) — Zcash technicals: privacy features, shielded transactions, regulatory risk, law enforcement, and illicit crypto use statistics
• (18:45–22:41) — Portfolio allocation, availability heuristic, and the case for primarily investing in cash-flow-generating assets
• (21:20–23:29) — Closing advice: emotional management, taking profits, aspirational risk, and keeping hoarding/speculation in check

Summary Takeaways

• Hoard assets like gold or crypto as protection, but prioritize assets that grow the economic pie (stocks, bonds).
• Investing decisions can be swayed by FOMO and emotional attachment. Stay rational and take profits when appropriate.
• Zcash provides significant privacy not afforded by Bitcoin, for better or worse, and this feature underpins both its utility and regulatory risk.
• Remember the scale and significance of asset classes—crypto may loom large in headlines but remains small relative to stocks and gold.
• Keep speculative, hoarding-type assets to a prudent share of your portfolio.

For those who haven’t listened, this episode offers a balanced, self-aware look at crypto speculation, asset allocation, and the emotional sides of investing—with memorable, real-life examples and takeaways for both crypto-enthusiasts and cautious investors.