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Is Bitcoin a bubble or not? No one knows for sure, but it reminds me a lot of the 2000 dot-com bubble, when Internet companies were overvalued like crazy. We ha

by sunseb 9y ago

Is Bitcoin a bubble or not? No one knows for sure, but it reminds me a lot of the 2000 dot-com bubble, when Internet companies were overvalued like crazy. We had basically the same selling line: it's a new economy, a new paradigm, an exponential growth, you better join if you do not want to be left out, it will rocket to the moon, and so. I fear it will end up badly for a lot of people in Bitcoin. Make sure you exit before you end up with nothing.

mrisoli 9y ago
You can look at it the other way, the dot-com bubble happened under huge speculation that we'd "live on the internet" and the huge potential of e-commerce/marketing but the tools available were still not finely-tuned and the internet speeds were also lagging behind. But now that we have widespread adoption of smartphones and high-speed internet(still lagging behind in some countries), plus a plethora of tools to build apps and track, analyze and influence user behavior, tech companies are some of the wealthiest and most influential enterprises on the planet, two of them even survived the 2000 bubble(GOOG and AMZN), IMO, far beyond the imagined potential of dot-com predictions. So I partly agree with you, I think there are some extreme expectations on BTC and a major crash seems possible, but who knows, maybe technology will enable BTC or some other cryptocurrencies to thrive the same way the internet recovered from the dotcom bubble burst.
charlesdm 9y ago
The entire market cap of crypto is around $250bn at the moment. The .com bubble went up to $6.7 trillion before correcting back down to 1.7tn. In todays dollars that's close to $8tn. One can only hope this will be "the next" .com bubble -- there will be money to be made. Given the amount of liquidity that was pumped into the market by the fed, it will be interesting to see what stops this train. The more and more you look around, money isn't worth anything anymore. Like that recent Leonardo Da Vinci painting that was sold for $450m. Assets and companies selling for a 10-12x multiple, excessive property prices in prime locations, etc. Asset prices have been driven up significantly across the board.
- yyyyip 9y ago
  Yep, it's like Fiat currency is some crappy thing poor people use to live on while the rich accumulate actual scarce resources with infinitely appreciating prices.
  - charlesdm 9y ago
    There are advantages as well though -- for those being able to create assets (companies, profitable products, etc), those will generally sell for a higher multiple than before.
srwx 9y ago
I guess it depends on if you see cryptocurrencies as a way to make money in the short term or if you see cryptocurrencies as the future of money. I'm firmly in the latter camp and am not looking to ever "cash out".
- priitmaxx 9y ago
  Cryptocurrency yes. Bitcoin is questionable.
deleted 9y ago
[deleted]
priitmaxx 9y ago
Until bitcoin has real utility, it has to be a bubble. All the dark web stuff can't be a constant driver of price. Most people are gambling with no intent to participate in the dark web.
- Double_a_92 9y ago
  Bitcoin is not even the best coin for the darkweb anymore. Transaction costs are high, Transactions take forever to pass, and it's not even really anonymous.
yarg 9y ago
A currency with a perpetually ascendant value (or perceived value/price) has little value as a currency - people will be strongly disinclined to spend it. So what's left but a token that has no underlying value other than a proposition which can largely be discounted?

by sunseb 9y ago

mrisoli 9y ago

You can look at it the other way, the dot-com bubble happened under huge speculation that we'd "live on the internet" and the huge potential of e-commerce/marketing but the tools available were still not finely-tuned and the internet speeds were also lagging behind. But now that we have widespread adoption of smartphones and high-speed internet(still lagging behind in some countries), plus a plethora of tools to build apps and track, analyze and influence user behavior, tech companies are some of the wealthiest and most influential enterprises on the planet, two of them even survived the 2000 bubble(GOOG and AMZN), IMO, far beyond the imagined potential of dot-com predictions. So I partly agree with you, I think there are some extreme expectations on BTC and a major crash seems possible, but who knows, maybe technology will enable BTC or some other cryptocurrencies to thrive the same way the internet recovered from the dotcom bubble burst.

charlesdm 9y ago

The entire market cap of crypto is around $250bn at the moment. The .com bubble went up to $6.7 trillion before correcting back down to 1.7tn. In todays dollars that's close to $8tn. One can only hope this will be "the next" .com bubble -- there will be money to be made. Given the amount of liquidity that was pumped into the market by the fed, it will be interesting to see what stops this train. The more and more you look around, money isn't worth anything anymore. Like that recent Leonardo Da Vinci painting that was sold for $450m. Assets and companies selling for a 10-12x multiple, excessive property prices in prime locations, etc. Asset prices have been driven up significantly across the board.

yyyyip 9y ago
Yep, it's like Fiat currency is some crappy thing poor people use to live on while the rich accumulate actual scarce resources with infinitely appreciating prices.
- charlesdm 9y ago
  There are advantages as well though -- for those being able to create assets (companies, profitable products, etc), those will generally sell for a higher multiple than before.

srwx 9y ago

I guess it depends on if you see cryptocurrencies as a way to make money in the short term or if you see cryptocurrencies as the future of money. I'm firmly in the latter camp and am not looking to ever "cash out".

priitmaxx 9y ago
Cryptocurrency yes. Bitcoin is questionable.

deleted 9y ago

[deleted]

priitmaxx 9y ago

Until bitcoin has real utility, it has to be a bubble. All the dark web stuff can't be a constant driver of price. Most people are gambling with no intent to participate in the dark web.

Double_a_92 9y ago
Bitcoin is not even the best coin for the darkweb anymore. Transaction costs are high, Transactions take forever to pass, and it's not even really anonymous.

yarg 9y ago

A currency with a perpetually ascendant value (or perceived value/price) has little value as a currency - people will be strongly disinclined to spend it. So what's left but a token that has no underlying value other than a proposition which can largely be discounted?