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If you still think Bitcoin is a Bubble ……
01/29/2014Posted by on
Then that’s your opinion, which you are entitled to hold … Recently, the idea that ‘Bitcoin is a bubble’ has become very popular, although many more people were jumping on the ‘just a bubble’ fallacy in late November/early December of 2013 when Bitcoin’s growth pattern appeared to mimic the classic “bubble curve” – even distinguished economists (who should have known better) were rubbing their hands and saying, ‘I told you so.
But the “crash” never happened
The fallacy of the “Bitcoin is a just Bubble” position is that it fundamentally misunderstands that Bitcoin is not just “coinage” ( of whatever “monetary value” you might like to speculate that it is, or is not ) but a unique mathematical protocol, open-sourced, and verifiable – built on the blockchain and driven by its peer-to-peer networking effect. Bitcoin “lives” within the nodes of the internet itself, unable to be influenced by outside counterfeiting, or printing more paper money as Governments have recently been doing, and is thus a perfect store of long-term value in its own right . If you already understand this, all this media talk of “bubbles” are easily dismissed.
However – to the doubters , who still want to believe Bitcoin is a Bubble – here’s some advice for you
The “Bitcoin Bubble” hasnt “popped” … but if you still want to hang onto the thought that it will .. look at the graph below. There have been a series of well publicized “bad news events” recently ( Central Banks ‘warnings’, accounts of stolen wallets ; and the latest – the arrest of the head of a leading exchange on criminal charges of money laundering – as if HSBC hasnt been doing this for years for the big drug cartels in Latin American ) But the price has held up solidly. The bitcoin community is very resilient, speculators may panic sell – but bitcoiners know its not a bubble ! and that it will only continue to grow and grow as more and more people understand its true nature and Bitcoins adoption into the mainstream economy is inevitable.
For a bubble to develop now, Bitcoin will need to mirror the classic bubble curve profile once again. This would mean the need for another exponential rise in the price. let’s say this ‘bubble effect’ starts next month. By the time the ‘crashing point’ of the classic bubble curve will have been reached ( taking as precedent the growth of bitcoin over the past year ) a very ‘conservative’ estimate would have Bitcoin trading at from $4,500 to $5,500.
So – even if you are still convinced Bitcoin is “just a speculative bubble” – please don’t bother to worry about it until nearer Next Christmas . You’ve plenty of time to invest a little cash now, and it will buy all your Christmas Presents ! !
Bye the Way – it’s not going to burst then either ! ! – Trust the @BitcoinRat