Bitcoin is not a bubble. And here's why

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2017-11-13 10:30:06

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Bitcoin is not a bubble. And here's why Source:

Many public figures in the traditional financial sector, including JPMorgan CEO Jamie Morgan, have criticized bitcoin, describing it as a bubble. However, because of the decentralized, mathematical and transparent nature to call bitcoin a bubble of any kind will be very, very wrong.

Bitcoin is not a bubble, contrary to popular and dishonest statements by Bank representatives. Bitcoin was a bubble in 2013, when demand for bitcoin has risen to such an extent that the market couldn't support him anymore, and the price of bitcoins fell from $ 1,300 to $ 200. But it would be inaccurate to call the bitcoin bubble just as it is impossible to call bubble some Amazon or Tesla.

Until April this year, analysts described the exponential growth in the cost of Tesla as a "bubble", and the same analysts did with Amazon throughout its 20 years of existence of the company. Six months ago Matthew Debord, editor of transport in Business Insider, wrote:

"At the moment, the Tesla bubble seems obvious, and it seems obvious from the beginning of this year. The difference is that its growth is so big that it becomes intimidating".

Another "expert" Dewind Greenlight Capital's Einhorn said that Tesla is a bubble that will burst soon, but the bubble. "Over time it is expected that these bubbles will burst," he says.

It is Important to understand that this trend is inherent in any growing company, technology and startups. Analysts and experts to quickly call anything a bubble, based on the rapid growth of value and exponential growth.

From 2013 to 2017, the price of Tesla stock increased from about $ 20 to 302 dollars, with many minor and significant adjustments. In December, the share price of Tesla fell more than $ 100, with 250 to $ 150 due to financial problems of the company. However, over time, Tesla has recovered and developed sustainable business, market and, most importantly, consumer base, similar to the one that turned bitcoin into a stable financial network, a reliable market and tens of millions of users.

In addition, it is unfair to say that the market for bitcoin, which has similar liquidity and trading volume that Apple is the most liquid stock market in the world with a trading volume of 3.3 billion dollars, because he has strengthened significantly since the advent in 2009. Bitcoin is more legitimate than most other systems, as one of the founders of Apple Steve Wozniak. At the conference Money2020 Wozniak said:

"There are a limited number of bitcoins that will ever exist. Gold mined, mined and extracted. Possible. In the world there is a finite amount of gold, but bitcoin is more mathematical and settled, and no one can change math".

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