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Bitcoin Is Unlike Any Other Bubble We’ve Seen So Far

CryptocurrencyJan 13, 2021 12:09PM ET
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© Reuters. Bitcoin Is Unlike Any Other Bubble We’ve Seen So Far

(Bloomberg) -- While the jury is still out on whether Bitcoin is a bubble, one thing is certain: it’s unlike any other bubble we’ve seen.

Previous speculative asset-inflation episodes were either a one-off, like tulip mania in the 17th century, or the boom-doom cycle took many years, like gold. Bitcoin, by comparison, has survived three peak-to-trough drawdowns of over 80% in less than 10 years. The cryptocurrency surged past $40,000 last week to set an all time high. It has fallen more than 15% since then.

Man Group, the world’s biggest publicly traded hedge fund firm, compares Bitcoin to Prometheus in Greek mythology, whose liver keeps growing back, every time a giant eagle pecked it out.

“Every time a Bitcoin bubble bursts, another grows back to replace it,” Man Group’s analysts wrote in a note dated Jan. 12. “This very frequency makes the Bitcoin narrative somewhat atypical relative to the great bubbles of the past.”

Here’s a table of some financial bubbles compiled by Man Group.

Read More:

“Instead of considering each individual spike and fall as a discrete bubble, there may be more merit in the argument that this volatility is simply part of the price discovery in a new asset class, and that these are not bubbles, but part of a not-so-random walk that will eventually dwindle to give Bitcoin more stability, and ultimately, legitimacy,” the analysts wrote.

©2021 Bloomberg L.P.

 

Bitcoin Is Unlike Any Other Bubble We’ve Seen So Far
 

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Comments (3)
Tiwan Allen
Tiwan Allen Jan 18, 2021 12:37PM ET
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lol
Tiwan Allen
Tiwan Allen Jan 18, 2021 12:37PM ET
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they can not cash up do i had bicon stock am doin good
Alan Rice
Alan Rice Jan 13, 2021 2:32PM ET
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Usually , Ponzi schemes have SOME beneficial, and ethical, item at their core, (like sweet smelling tulips). Bitcoin ??
 
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