Re: Crypto Bubble
Posted: April 8th, 2021, 4:56 pm
justfisk wrote:
In the World of "Crypto", Bitcoin stands alone as the Store of Value. There are not many alternatives. In the list you shared, Ethereum is more a platform for smart contracts and even its founders do not market it as a store of value.
Tether and Binancecoin are Stablecoins not stores of value . XRP is a centralized token run by Ripple labs battling lawsuits by the SEC, even "Bitcoin Cash" which is a fork off Bitcoin is designed to be a cup of coffee payment token, not a store of value. Dogecoin was created as a joke.
In addition, do not forget the importance of "Network effects". For example, even if we come up "LemonfoolBook" as a marginally better designed "Facebook", network effects almost doom it to fail. Moving all friends, family and value already stored in Facebook to Lemonfoolbook would prove quite challenging. In the Technology space, Network effects dictate only 1 winner.
Suffice to say all other altcoins trade around the orbit of Bitcoin and its 4 year halving cycle.
The same way I expect tiny online retailers to trade around the orbit of Amazon.
JF
Seriously, Bitcoin a store of value? For what, a couple of years? I think something needs to have been around a bit longer than that for it to be recognised as a store of value.
Very few people have a significant amount of money in Bitcoin and I cannot see any problem with a better cryptocurrency taking it's place. How about one that didn't need to be mined with all the consequent energy requirements? Just dump X million of the new cryptocurrency into the World and let the market find a price. Bitcoin is a test case for cryptocurrency and carries with it all the flaws that test cases exhibit. It is unlikely IMO to be the final version.
Corporate analogies fail thanks to the huge number of dominant businesses that have gone on to be outcompeted by newcomers. I have plenty of painful share price memories that bear testament to that!
BoE