It's Not Just A Bitcoin Bubble - It's Far Worse Summary: Companies have drastically increased their value by simply adding "blockchain" to their name. The Bitcoin bubble is spreading out of cryptocurrencies and into sound, successful businesses. Unprofitable, highly leveraged organizations are being valued at millions, even billions, for being related to Bitcoin. The US stock market is also considered to be significantly overvalued by historical standards by many professionals. I wrote in my last article I Bought A Bitcoin, And Now I Feel Sick that Bitcoin is in bubble; whether you agree with that or not is your opinion, but the Bitcoin bubble argument aside, there is an inarguable cryptocurrency craze that is far worse than just a Bitcoin bubble. It seems that any company having relation to Bitcoin, cryptocurrencies or blockchain technology, is in a bubble. If a company’s name includes “Bitcoin” or “blockchain”, their stock has been providing returns we haven’t witnessed since the Dot-Com bubble. This is eerily similar to previous bubbles we have witnessed. During the Dot-Com bubble of ’99-’00, if a company added “.com” or “e” to its name, the stock significantly increased and became worth more. Nothing material about the business changed, no additional sales were being made, and no positive developments occurred, the business became more valuable for no logical reason. This appears to be happening all over again. As written in The Coin Telegraph, “Adding ‘Blockchain’ to Name Causes Soaring Valuation,” and on Cryptocoins News, “Want to Boost Your Stock Price? Add ‘Blockchain’ to Your Company’s Name.” That being said, blockchain technology is not Bitcoin. Blockchain technology will likely be revolutionary, while Bitcoin is essentially worthless (meaning, it has no value, or its value is undefinable). It is unwise to use Bitcoin as a currency to buy goods or services because the price is rising so rapidly. This price appreciation can cause you to pay over $100 million for two pizzas, as one gentleman did a few years ago by paying for his dinner with Bitcoin. So, if it can’t be used as a currency to buy anything, and when you “invest” in it you’re not having any ownership in a company, what is it truly worth? What is a fake coin in your electronic wallet truly worth? https://seekingalpha.com/article/4130195-just-bitcoin-bubble-far-worse
This is nuts...I wouldnt bank on any dips. All rules have been thrown out the window for now. Just hold and watch this craziness unfold.
This kind of stuff scares the crap out of me. Deep down, I understand it, but I dont want to....I need this to set me up nicely in the future.
Seems to me there is a tendency to be on one extreme of the other with BTC and crypto in general. Either you're all-in or you're 100% against it and almost wish it would fail. Logic states perhaps the answer is ultimately in between a range of neutral outcomes. This is the internet culture we live in where its always fanboys vs haters. We need to reestablish the middle ground.
I basically just allocated my gambling budget towards crypto. Better than sports betting. Almost more exciting because it's constant.
People were saying things like this during the dot com bubble, too. The problem is you won't know that it's falling apart or has fallen apart until hindsight kicks in in most cases. Back in '98, I worked at a company where a guy was saying his 401k alone would make him a millionaire by the time he was 35 ... yeah... he's still working. All I can say is... be careful.
Are you asking about currencies specifically or all other coins and tokens? Bitcoin, Bitcoin Cash, Litecoin, Dash, Monero are all digital currencies. Each try to solve a different problem. For example, Monero touts private untraceable transactions. Others promise quicker and cheaper transactions. Bitcoin has become more of a storer of value. To be a currency, it needs to be stable which none of these are. Long term is subjective as things can drastically change over night. Bitcoin could hit 100k next year and if theoretical vulnerabilities such as quantum computing or 51% attack ever happen, it could kill Bitcoin. Ethereum, Ripple, IOTA, and Neo are blockchain projects that try to solve some sort of problem. Each has its own unique 'coin'. I would not consider these as currencies but more as investments such as a stock. EOS, OmiseGO, Golem, TenX are tokens and ride on a master chain. All of these examples ride on Ethereum. These all try to solve certain problems too. The problem with tokens is that they are initially issued as ICO's designed to help fund their project. There are many projects out there that are really cool, but at the end of the day, one must ask how they create value. To better understand, some believe we are entering into the 3rd iteration of the web. Web 1.0 was the ability to follow links and read text from other sites. Web 2.0 was the ability to read and write to sites (like this one). Web 3.0 is about decentralization and block chain explorers. An example is steemit.com. While the webpage looks like any other site, however all of the content is stored in the steemit blockchain.
I think people should also consider it as a potential cryptocurrency bubble and not a bitcoin bubble. Remember that several successful companies went through the dot-com bubble and came out fine -- amazon and ebay for example. (/insert joke about $eth kitties and pets.com) There's 1000s of cryptocurrencies, no way they will all win out and most will go for broke -- but that doesn't mean everyone in the space will be left holding the bag. The crazy thing is BTC is the safest bet of them all, but that's the one everyone points to as a bubble.
Companies have drastically increased their value by simply adding "blockchain" to their name. A few inconsequential companies that have very little effect on the stock market, unless you can provide better examples than the ones in your article. The Bitcoin bubble is spreading out of cryptocurrencies and into sound, successful businesses. I agree that bitcoin is spreading into businesses, whether that's the CME or CBOE offering futures exchange, or other consumer goods companies taking bitcoin as a currency. I don't think bitcoin is fundamentally altering how those companies do business. Unprofitable, highly leveraged organizations are being valued at millions, even billions, for being related to Bitcoin. Besides the few companies that you listed, which look more like fraudulent shell companies, I don't see that happening. Again, you would have to provide evidence that truly important companies are seeing million dollar or billion dollar increases in market cap from bitcoin, and their percent change in market cap is large enough to where that increase actually matters to their equity valuation. The US stock market is also considered to be significantly overvalued by historical standards by many professionals. I don't really see how this point relates to bitcoin, especially since I don't think your argument for bitcoin contagion holds up. Also, many economists, bankers, and researchers see increased economic growth and relative stability in the markets in 2018, with a potential slowdown beginning in fall 2019. Bitcoin's buildup has been quite rapid, so yes, it could be a bubble that could burst. It could simply be overvalued and see a drop in price as volatility declines. We have a better understanding now than the dotcom bubble of concepts like network effects, and bitcoin could be a beneficiary of network effects in the cryptocurrency space. Bitcoin could also have value if people see it as a Giffen good, where it is desired more as the price rises. It could also have value as a storage of wealth, like gold. I agree that it doesn't seem to have much purpose as an everyday currency, but I don't think that's driving the price up.
Again, level-headedness is gone in our internet culture. Google will show us hype fluff or doomsday scenario articles. We need to use critical thinking skills to dig deeper and identify the unpopular, but wiser opinions.
I think more and more money will start going into alts with people trying to hit homeruns. I mean when you have some coins going up 100% in a day and 1000% in a month people are going to want a piece. When that type of money comes into the game there will be lots of scammers and crooks trying to get rich off it. Eventually I think something will happen where there will be an alt coin crash that will hit bitcoin pretty hard. Bitcoin will survive but they will drop in price because of it. If it is like Amazon they hit around $107 dollars per share in the dot com run-up then fell to $8.36 when it popped. Losing about 92% of their value when the bubble burst. So that would equate to BTC going from 14k to $1120.00.
my advice is to stop clowning around with altcoins and just buy bitcoin steadily, and never sell it people see the price and think they are getting in too late, so they go for an altcoin, but I think that's a mistake we are seeing a massive transfer of wealth into a new world reserve currency as the ultimate secure and dependable store of value
I don't think there is anything wrong with putting some cash into alt coins if you are just goin to sit and wait on them long term. Day Trading is going to be too hectic for it with all the pairings. Some of these alts have something to provide so they will be of value. Not saying through your whole portfolio but it should be a part of it. The majority of it you go slow and steady with Bitcoin and let it ride. Just diversify. Same as any other investment in my opinion.
Do any of you guys use a software wallet or whatever or is it better to invest in a hardware one. I'm not starting with a lot so not too concerned, but just wondering on any recommendations, I read keeping it in the exchanges is risky, but if I have it in a wallet how long does it take to trade out of the wallet. Sorry for the additional questions..
All the way up to $100k? In all seriousness, someone estimated Bitcoin to be $100,000 one day. It might actually come true.
I think I've read 2 or 3 analysts say that now, but people also said Qualcomm stock would be headed to $1000 ... they have no idea. They're guessing ... even an educated guess is still a guess.
