Is Bitcoin in a Bubble, or Is It Massively Undervalued?

[bbc.reporter]

I speculate that there are some anti-bitcoin groups behind every bitcoin is a bubble news released. They are trying to disseminate fear and confusion among the crowd, and at the same time, they are charging up to short bitcoin to profit from the crash, while again getting ready to buy the bottom.

Wall Street plays the same game as the whales of bitcoin, but by a magnitude greater.



Bitcoin is all the rage again, and its major sustained price increase in recent weeks has prompted considerable interest and novice investment in the world's first cryptocurrency. Some people see this as a sign that bitcoin's end is near, but others argue that the infant e-money is actually massively undervalued in the long run.

As is common with any price peak and flurry of media chattering, bitcoin's most recent momentum has been met with predictions of boom and doom. A Wall Street Journal survey of economists found that an astounding 96 percent believe that bitcoin is experiencing a speculative bubble. The question for them is not whether the bubble will burst, but how badly, and how soon (if ever) it will recover.

It is true that the market shows signs of frothiness. Seasoned bitcoin users have found themselves inundated with questions from friends and relatives about how to cash in on this hot get-rich-quick scheme. When I talked to radio host John Batchelor about the bitcoin price increase last week, he told me he was reminded of the famous 1929 tale wherein famed investor Joe Kennedy quickly exited the stock market after his shoe shine boy deigned to give him investment advice. Contemporary anecdotes about people taking out mortgages to buy bitcoin fall into a similar vein.

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[timerland]

I believe that right now, bitcoin is in a bubble. That does not mean that i don't think that bitcoin will not go up in the future, or not be successful in the long run. Quite the opposite actually, but in the short term it's definitely a bubble.

The 2013 bubble ended with bitcoin crashing to around $200, and lost nearly 90% of its peak value. However 4 years after that here we are, at 20x that peak price. But you still call that 2013 rally a bubble, because it was just too much money in too little time.

I think this rally will end with a crash, but bitcoin will recover and in the long term, we've still got a long way to go and potentially the current value could even be undervalued. But you can definitely buy in lower than right now imo.

[coingeeks]

I'm inclined to agree that what we're seeing in the short term is a bubble. Over the long term however, I think BTC is going nowhere but up.

While what any of us believe is basically speculation at this point (how could any of us really know?), I don't think that major corporations would be taking BTC and crypto as a whole seriously if it didn't have prospects for long term survivability.

BofA just got their exchange patent approved, JP Morgan had applied for a patent (getting denied must've stung :p); the list of big names in crypto is growing.

What I'm really stoked about are some of the new developments based on blockchain that have nothing to do with crypto. Like Boeing's GPS security/redundancy system, or Walmart's drone delivery mechanism, or Mastercard/Visa looking to speedup their transaction networks.

It's a great time to be alive ^_^