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Bitcoin Was a Bubble and It Popped

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Re: Bitcoin Was a Bubble and It Popped

#71

Post by majewsky »

Obi_Juan_Kenobi wrote: post #62
ummonk wrote: post #13

Earlier quoted context omitted.

This is the first pop that I’ve felt is likely to be the last. A lot of people got burnt and are unwilling to jump back in.

So far Bitcoin investor behavior has been remarkably consistent. https://plot.ly/~unchained/37/bitcoin-utxo-age-distribution/... There's a lot to dissect in this chart, so take some time with it. Some observations: * Most of the market is traded during bull runs. Each bull run sees a large segment of year+ holders take profits. Between bubbles, price-discovery is driven by short-term trading. * Bear markets see remar…

> The main takeaway from this is that Bitcoin investors are remarkably willing to hold.

How does this look like in other markets? It sure tastes like survivorship bias. As in: "Investors are willing to hold" because everyone else already quit.

Re: Bitcoin Was a Bubble and It Popped

#72

Post by ScottAS »

themgt wrote: post #16
ascendantlogic wrote: post #2

As it has done multiple times previously. I anxiously await reading why this time is "different", just like all the previous times.

Because the previous times it wasn't being hyped in mainstream news and culture. The point where the guy on the elevator is taking about [bubble] is the point at which [bubble] is about to burst for real, because you've just about run out of new suckers to fuel it.

Well, the gold bubble has yet to "permanently" pop, and has been through multiple phases of mania - an arbitrary substance worth trillions of dollars which our entire supply of fits in 3 olympic swimming pools. Socially agreed upon value can potentially last for generations without any fundamental sense.

Re: Bitcoin Was a Bubble and It Popped

#73

Post by ScottAS »

the_gastropod wrote: post #59
ascendantlogic wrote: post #36

Earlier quoted context omitted.

How many people got burnt in the dotcom crash? In the financial crisis of 2007-2008? Black Monday of 1987? Did all of those people swear off investing in traditional equity instruments forever?

After the 2007/2008 financial crisis—the worst financial crisis in the history of the US—the S&P500 dropped 54.1% from peak to trough. BTC is currently down over 80% since its peak. Let's also make sure we understand that the S&P500 (or any stock ownership) is owning _business(es)_. Businesses make money, and they return that money to their owners. Bitcoin is purely speculative and depends on someone else buying it f…

Have you ever heard of gold?

Re: Bitcoin Was a Bubble and It Popped

#74

Post by panarky »

themgt wrote: post #16
ascendantlogic wrote: post #2

As it has done multiple times previously. I anxiously await reading why this time is "different", just like all the previous times.

Because the previous times it wasn't being hyped in mainstream news and culture. The point where the guy on the elevator is taking about [bubble] is the point at which [bubble] is about to burst for real, because you've just about run out of new suckers to fuel it.

It's damn difficult to discriminate in advance between a bubble and a Revolution der Denkart [0].

The presence of hype, fraud and large fluctuations in prices do not invalidate new technology or concepts.

The dotcom "bubble" was a hypefest, then it deflated, but the underlying technology and concepts have spawned something many times larger than the original bubble.

If it turns out that cryptocurrencies have no purpose beyond a small niche, then we'll see in hindsight that it was indeed a bubble.

But if creative people find a larger use for cryptocurrencies, then hindsight will understand the 2018 "crash" as just another in the fractal series of price declines followed by even larger price increases.

Since the underlying technology has withstood sustained attacks across the technical, economic, political and legal domains, perhaps reports of its death are premature.

[0] https://books.google.com/books?id=sRYW1wtdER0C&pg=PA136&lpg=...

Re: Bitcoin Was a Bubble and It Popped

#75

Post by yellowapple »

verdverm wrote: post #61
yellowapple wrote: post #46

Earlier quoted context omitted.

I think Bitcoin would be a good fit for transferring value between large entities (governments, banks, etc.), where having public accountability would be especially valuable. Those entities could then exchange it with other lower-valued cryptocurrencies, fiat currencies, precious metals, seashells, etc. more suitable for day-to-day consumption by the general public.

Would you have your transactions out in public view?

Not necessarily, but I'm not a government or other large institution :)

Re: Bitcoin Was a Bubble and It Popped

#76

Post by KasianFranks »

the_gastropod wrote: post #44
KasianFranks wrote: post #4

Like the dot com bubble, and here we are today bigger, better and stronger. Think in terms of a public trading vehicle that enables anyone to raise capital in a global marketplace. Either real value gets translated to that vehicle or it does not.

"Everyone said Bob was an idiot for playing the lottery, but look at him now!" " is a $10 Billion/year industry! If we could just capture 1%..." Just because some other thing was successful doesn't mean your pet thing will be successful too.

So lets just stop innovating right here right now. Bad logic.

Re: Bitcoin Was a Bubble and It Popped

#77

Post by berbec »

morgancmartin wrote: post #66
tn_ wrote: post #26

Earlier quoted context omitted.

This guy bitcoins.

Haha, thanks for the laugh. Considering the downvotes I got, I suppose I was out of line suggesting a wager, but I've yet to see convincing evidence for why blockchain tech can't work. Sure it's overhyped way beyond what it deserves and it hasn't found its "killer app" or niche yet, but that doesn't mean it won't. Nano's my favorite coin. It's fee-less, near-instant, and secure. Its largest flaw (and one all coins sh…

I have no skin in the game either way, so I am curious (asked before):

Is crypto:

money/currency (spend able exchange of value)

a store of value (investment etc)

a cool technology with no current useful application

or something I don't understand?

If crypto is money, can I:

Spend it at Amazon? My grocery store? My corner deli? Pay my rent? Pay my employees?

If crypto is a store of value can I trust it will have any rational storage value over any time period?

Re: Bitcoin Was a Bubble and It Popped

#78

Post by berbec »

ScottAS wrote: post #73
the_gastropod wrote: post #59

Earlier quoted context omitted.

After the 2007/2008 financial crisis—the worst financial crisis in the history of the US—the S&P500 dropped 54.1% from peak to trough. BTC is currently down over 80% since its peak. Let's also make sure we understand that the S&P500 (or any stock ownership) is owning _business(es)_. Businesses make money, and they return that money to their owners. Bitcoin is purely speculative and depends on someone else buying it f…

Have you ever heard of gold?

Gold has a very long history, useful applications in industry, jewelry etc and is a defacto currency the world-wide.

Crypto is... None of these. Whatever crypto is or will become, gold it, currently, is not.

Re: Bitcoin Was a Bubble and It Popped

#79

Post by abstrct »

abstrct wrote: post #58
kokokokoko wrote: post #42

Earlier quoted context omitted.

Cryptocoin speculation will likely be remembered closer to beanie babies or baseball cards as opposed to the dot com bubble etc. This was just the first time we saw this happen globally and with digital goods. Which, possibly coincidentally, happened to baby boomers right when they were around the same age/point in life as the millennial generation is now.

> Cryptocoin speculation will likely be remembered closer to beanie babies or baseball cards as opposed to the dot com bubble etc. What exactly do you base this idea on? Are you involved in the technology at all? An economics major? Or do you just believe that Mr Noah Smith has the expertise to opine on such a situation.

Sure, downvote me because I was a bit mean sounding, or maybe because you are sick of hearing about Bitcoin. I feel like it's a fair question though. To say that Bitcoin will be remembered more like beanie babies and baseball cards, rather than the dot com bubble, sounds absurd to me.

You have the worlds largest tech companies, banks (the IMF!), the Big Four advisory firms, top lawyers around the world, governments at all levels, and just some incredibly active open source communities, all working with this technology. Why belittle it like what was done in that comment? Can't we at least agree that after ten years, Bitcoin has been an experiment worthy of its own story rather than being lumped on either side of "beanie babies or baseball cards as opposed to the dot com bubble"

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