Is Bitcoin a bubble? According to Robert Shiller, a Nobel Prize-winning economist, proposed a strategy which helps to determine if something...
Is Bitcoin a bubble?
According to Robert Shiller, a Nobel Prize-winning economist, proposed a strategy which helps to determine if something is a bubble or not. Said sharp increases in the price of an asset, great public excitement, media frenzy, stories of people getting rich and growing interest in the asset among the general public. Bitcoin checks all of those boxes.
So, in a way, Bitcoin is a bubble or not and it has burst before. After the famous Exchange closure of Mt.Gox at the beginning of 2014, formerly the most prominent Bitcoin exchange in existence filed for bankruptcy due to technical problems and the loss of 744,000 of its users' Bitcoins. That number made up about six percent of 12 million Bitcoins in circulation at the time. A Chinese exchange that was handling more than 70% of all the Bitcoin transactions worldwide, BTC’s prices were falling continuously for about a year. Of course, it is hard to predict that what will happen in the future and there is a possibility of Bitcoin’s prices plummeting again. Still, Bitcoin has recovered before and it is currently stronger than it ever was.
In the year 2018, there was a large sell-off pressure from January 2018 to February 2018 the bitcoin price remains half, while in some countries it goes down about 70-80% because of its regulation. Many countries started to take strict action against money laundering in bitcoin. Not the bitcoin goes down but also other cryptocurrency goes about 80-90% down. So we can say 2018 is the bad year for all cryptocurrency users.
Now In 2020 bitcoin again goes up.
Thousand of cryptocurrency in the market
In the crypto market, there are many cryptocurrencies is listed with promising value. In January 2018 many altcoins were listed and most are scammers. So we can say it like the dot-com bubble they don’t have any business plan.
Initial coin offering
When the new cryptocurrency token will comes is known as Initial Coin Offering (ICO) in the cryptocurrency industries.
It is equivalent to an Initial Public Offering (IPO).
ICO or IPO acts as a same way to raise funds from the market place.
Interested investors can participate in ICO and if he/she is eligible then they will get tokens into their wallet.
In the year 2017-18 many ICO was ready to come in the market place.
Bittrex and Binance was the biggest exchanges that offer the services of the Crypto Trading Platform with a high volume.
All the ICO is transferred into the Exchanges wallet addresses.
After they can start trading.
The people who don’t have any company or not offering any services they also come with their ICO and started collecting a huge amount of money from the market place. After this, the investors lose all their money.
MLM
Multi-Level Marketing is also a big scam in the cryptocurrency industries. Many people run the Ponzi Scheme. Some Companies says that they will double the money of their investors within a year. Some people became rich within a year while some losed a huge amount.
Conclusion:
In the year 2018, the bitcoin price drops very low. Many investors lose their money. In the year 2020, the Bitcoin price is almost recovered.
So no one can say that Bitcoin is bubble or not.
This gives a lesson to invest that much money that you can afford to lose.
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