Bitcoin – tulip bulb or another gold?

Bitcoin’s recent rising momentum have made financial players wonder whether the cryptocurrency will not become one of the most scandalous bubbles in history. The extent to which Bitcoin climbed to highs close to $ 20,000 suggests that investors need to worry.

As the chart shows, the nearly 60 times increase in crypto-wave in the last three years is really unusual. Looking back over time, Bitcoin’s upsurge managed to surpass even ‘tulip fever’ in the 1930s, when a bulb had increased its value 35 times, and with a few bulbs you could buy a house.

On the other hand, compared to Nasdaq, during the Dot-com bubble, the movement of the technology index looks like a dead man’s pulse.

Bitcoin even managed to overtake the French company Mississippi, whose price increased more than 35 times during the first three years of the boom.

Bullies, however, are of the opinion that Bitcoin’s increase is just beginning, and market analysis takes much more than simply comparing prices. If Bitcoin becomes a widely accepted form of digital gold, as predicted by Cameron Winklevoss, the rise may be much stronger than it has been so far.

Warren Buffett said he only invested in shares that “do nothing” and gave an example to Coca-Cola selling a sweet water at a price many times over its cost. With Bitcoin, you pay real money for overestimated goods. / Buffet’s oppinion/

Another frightening factor is the massive, exalted, and blind the buying of cryptocurrency without knowing the essence of the financial instrument. In New York they say: “When taxi drivers start buying, take the money and run away.”

On the other hand, somebody misleads that banks will allow to lose up to 50% of their business – the fees. In this regard, we see massive government restrictions on electronic currencies and declaring to create our own state-owned crypto-points.

Eventually, crypto-currencies have their own future and the question is not about their existence, but who will survive and what is their fair price. The problem is that as long as this is established with approximate precision, many players will either be “burned” or at least “heavily scorched.”

I’m not a fortune-teller and I do not have a crystal ball, but everything said above, plus the graph attached here form a frightening picture of such an investment, so we’re in cash.

Biser Varchev