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All bubbles pop eventually. I think there's little doubt crypto is a bubble right now. Maybe it pops tomorrow, maybe it goes on for years. I don't know, nobody

by eloff 6y ago

All bubbles pop eventually. I think there's little doubt crypto is a bubble right now. Maybe it pops tomorrow, maybe it goes on for years. I don't know, nobody really does.

chillacy 6y ago
If you value stocks based on book value + dividends and discounted cash flow, this bubble's been going on for almost a hundred years by now. We've just gotten used to the new multiples.
- Aunche 6y ago
  You also have to factor in growth into the equation as well. That's the most subjective part of a company's valuation.
- eloff 6y ago
  I don't see that. You'll need a source if you want to argue that. We've gone through cycles of higher and lower valuations. You also need to compare that to interest rates, because lower rates make the market more forward looking.
qq4 6y ago
That's the thing about bubbles, you don't know you're in one. My life is a bubble. I'm not going to worry about when it pops.
tradertef 6y ago
>> All bubbles pop eventually. I think there's little doubt crypto is a bubble right now. Same thing was said in 2013 and 2017..
- eloff 6y ago
  I don't think it was wrong then either. I think this is a greater fool style of bubble like the famous tulip bubble, eventually we'll run out of fools. That's my opinion, but we'll see.
  - mewpmewp2 6y ago
    The other possibility is that it will be widely used in the future as a store of value or for some other purposes. Might be rational to put at least some percentage of your net worth into it. People need and want something like that to exist where they have complete control over their assets without any worries about government or institutions.
    - eloff 6y ago
      In reality it is probably both. Unless governments take a hard line against bitcoin by banning it, something they mostly haven't been doing to date, I expect it will have a future as a kind of digital gold. However, gold has tens of thousands of years of history as an asset class, while bitcoin is a little less proven. Don't forget it used to be illegal to own gold in the US, so bitcoin is not as safe from government as people might think. But all financial assets tend to follow cycles of booms and busts. So the question is, where are we in the cycle? Are we nearing the top in the near term? I think we are, the growth of bitcoin has gone nearly vertical lately.
      - bl557 6y ago
        Bitcoin is still only 1/10 the market cap of gold, with the argument by Bitcoiners being that the asset is a 10-100x improvement over gold.
    - badjeans 6y ago
      > People need and want something like that to exist where they have complete control over their assets without any worries about government or institutions. The government can always just make a law and take whatever it wants from you (or imprison you). Doesn't matter if it's from a bank account or bitcoin cold storage on planet Musk.
      - solosoyokaze 6y ago
        > Doesn't matter if it's from a bank account or bitcoin cold storage on planet Musk. It's a lot easier for the government to pilfer your bank account, than for them to torture you to hand over your seed phrase (that is if they even know your real identity). Decentralization absolutely takes power away from the state. That's not even touching the truly anonymous crypto like zCash.
koonsolo 6y ago
I will leave you with this cartoon: https://images.app.goo.gl/dzZNEDdz4HkcSEaS8 https://images.app.goo.gl/dzZNEDdz4HkcSEaS8

by eloff 6y ago

All bubbles pop eventually. I think there's little doubt crypto is a bubble right now. Maybe it pops tomorrow, maybe it goes on for years. I don't know, nobody really does.

chillacy 6y ago

If you value stocks based on book value + dividends and discounted cash flow, this bubble's been going on for almost a hundred years by now. We've just gotten used to the new multiples.

Aunche 6y ago
You also have to factor in growth into the equation as well. That's the most subjective part of a company's valuation.
eloff 6y ago
I don't see that. You'll need a source if you want to argue that. We've gone through cycles of higher and lower valuations. You also need to compare that to interest rates, because lower rates make the market more forward looking.

qq4 6y ago

That's the thing about bubbles, you don't know you're in one. My life is a bubble. I'm not going to worry about when it pops.

tradertef 6y ago

>> All bubbles pop eventually. I think there's little doubt crypto is a bubble right now. Same thing was said in 2013 and 2017..

eloff 6y ago
I don't think it was wrong then either. I think this is a greater fool style of bubble like the famous tulip bubble, eventually we'll run out of fools. That's my opinion, but we'll see.
- mewpmewp2 6y ago
  The other possibility is that it will be widely used in the future as a store of value or for some other purposes. Might be rational to put at least some percentage of your net worth into it. People need and want something like that to exist where they have complete control over their assets without any worries about government or institutions.
  - eloff 6y ago
    In reality it is probably both. Unless governments take a hard line against bitcoin by banning it, something they mostly haven't been doing to date, I expect it will have a future as a kind of digital gold. However, gold has tens of thousands of years of history as an asset class, while bitcoin is a little less proven. Don't forget it used to be illegal to own gold in the US, so bitcoin is not as safe from government as people might think. But all financial assets tend to follow cycles of booms and busts. So the question is, where are we in the cycle? Are we nearing the top in the near term? I think we are, the growth of bitcoin has gone nearly vertical lately.
    - bl557 6y ago
      Bitcoin is still only 1/10 the market cap of gold, with the argument by Bitcoiners being that the asset is a 10-100x improvement over gold.
  - badjeans 6y ago
    > People need and want something like that to exist where they have complete control over their assets without any worries about government or institutions. The government can always just make a law and take whatever it wants from you (or imprison you). Doesn't matter if it's from a bank account or bitcoin cold storage on planet Musk.
    - solosoyokaze 6y ago
      > Doesn't matter if it's from a bank account or bitcoin cold storage on planet Musk. It's a lot easier for the government to pilfer your bank account, than for them to torture you to hand over your seed phrase (that is if they even know your real identity). Decentralization absolutely takes power away from the state. That's not even touching the truly anonymous crypto like zCash.

koonsolo 6y ago

I will leave you with this cartoon: https://images.app.goo.gl/dzZNEDdz4HkcSEaS8 https://images.app.goo.gl/dzZNEDdz4HkcSEaS8