Topic: POLL is bitcoin in a bubble? (Read 1021 times)

There are several things I'd like to respond to, but I don't have time to get into all of them now; I'll work on this some more later.  But for the moment, yes, I think we can at least agree that bitcoin is a currency.  That's what it was designed to be, and that's still at the core of how it's used.  Other currencies, especially reserve currencies like the dollar, are also sometimes treated as assets, held by people in other countries as an investment against their own local currencies if they are falling in value.

True, market is not fully saturated so basically, Bitcoin is not yet in a Bubble, aside from that, the current dip states seems a bull trap set by the Chinese Government.  PBOC shorted its trade! and they wanted to buy back at a super cheap price that is why they plan these hostilities.  Just you wait when China announced that they are once again opening Bitcoin trading in their country.  The plan seems to hit 2 birds in one stone, regulation and accumulation.

Demand can not alone sustain a currency. You need to understand that as well. If today there is demand then what guarantees you that tomorrow people will still want it? Might be in future there is some other form of monetary system better than Bitcoin or in general cryptocurrencies, then what will sustain the value of Bitcoin when demand won't be there. That is why I said. Today there is a demand and hence there is appreciation in price and this cycle will continue for more years to come. Right now growth is genuine. But ultimately there will be a point when people have better alternatives and demand will decrease significantly. Then the bubble will burst and price will drop might be to zero. That is why a currency need to be backed by something.

Well I guess you agree with me that Bitcoin is currency ( people using it as asset do not change the fact that it is currency ) , So Bitcoin should be treated for what it is really is not for what people use it for or think it is . You are saying that any currency have to be backed by something and you gave an examples , strong economy , oil and wealth but you simply forgot one more very important thing the demand, It can also be a very strong factor to determine the value of any certain currency . For example what happened couple days ago with china news !! people started to panic feel that they are not really safe holding BTC ! and we saw price fall down almost 40% because there was no more demand , And after people started to fell that the danger is over they started buying again which made the price go up again ( this is no where near pump and dump situation because simply it is backed by news ) . So in fact the price go up and down based on  something ( china news ) not without any reason and that how any normal currency in the world will react . People think BTC price go up without any reason which is totally wrong .
because there is one very important reason that almost everyone forgot or even not see it , even tho it is very clear . This reason is "Adoption"  wither it is from new people entering the crypto world ( new money in ) or from already existence people putting more  money into it .

By the way people using BTC to make money in fact add a lot to its value not just changing it to an asset 

Again, from wikipedia: "In finance, intrinsic value refers to the value of a company, stock, currency or product determined through fundamental analysis without reference to its market value." [https://en.wikipedia.org/wiki/Intrinsic_value_(finance)]

Commodity futures contracts are backed by specific goods (oil, cattle, corn, etc.).  Stocks are backed by their issuing company (i.e., their assets).  Currencies have value because they are backed by the economies and wealth of the nation that issue them.  If the money supply/currency for a particular country remains fixed, its currency appreciates against other currencies when its economy does well, and it depreciates when it does poorly.  The dollar is valuable because it represents a country with a strong economy.  The value of a country's currency is, of course, more complicated than this, but this at least shows how other currencies have something to back them.  The problem with bitcoin is that it doesn't have anything tangible to use to determine what it should be worth.

And while the concept of bitcoin is that it's supposed to be used as a currency, I think that most of the price action is due to using it as an asset to make money, not as a currency to pay for goods and services.

My take on this one is definitely a big "NO". Bitcoin is nowhere near at that "bubble stage" that others are always trying to say. If you can check the price history of it from the previous months and years, you can clearly see that we always have a major correction after a big bull run. Cryptocurrency market cap is still so small compared to the dot-com bubble that we had previously. We can only treat this as a bubble if we are in a huge bull run without any kind of consolidation but this is not the case as of the moment.

Most of the people around the world doesn't even know that Bitcoin exists. This only means that it has a lot of room to grow and that we are still in the adoption stage.

I agree in all you've said.
I just want to add that for a short timeframe we may have reached a peak and are in bulltrap region at the moment.
Bitcoin was going through this cycle several times before when you check the chart on certain local areas.
We may there be again, I don't know, and hope that's not the case. But we had almost two years of a bull run, and I wouldn't be surprised if it would find and end for some while.
Again I'm not a bearish and hope we will continue moving up, but you have to expect the other side of the medal to happen as well.

I totally disagree with this , define intrinsic value ! because with your understanding almost all the currencies in the world have no intrinsic value . I can give you endless examples , but lets first get few things straight BitCoin is not an asset Bitcoin is a currency and the price of a certain currency determined by the demand on it . so even if Bitcoin reached 1 million dollar and there is still people paying that much to buy it then it is worth what it is ,
your talk will be correct if we are speaking about an asset that the only value of it determined by the amount of return you get from it and this is not the case here .
I can keep go on and on explaining that BTC value is for fact its current price nor less not more so even if Bitcoin dumped to $1 it will be its value at that moment and if it pumped to $1,000,000 it will be its value at that moment as long as someone paying to buy it .

That chart has been around a long time and when i saw it again I must admit i became a little afraid that we now may be in the bull trap/return to normal phase. However this dosnt correspond to the phase grid as we are very much in the very early awareness phase if you consider how many people worldwide using or even know what bitcoin is.
I do think a break above $5k is required to confirm this and unless there is some huge shock news i see this happening. I would really like it to happen soon though before the 2x drama starts to get traction.
As for the bubble question, obviously no imo as the news out of china should have crashed it down to last years prices if we were in a bubble.

Thank you all for your well thought out and constructive views and opinions.

I know that this has been hashed to death on here but wanted to see what the general consensus was amongst some of the newer and veteran members.

Again, thank you kindly for your time and valuable input and ideas.

All the best,

-jd

Indeed, having no intrinsic value and still rising is considered to be a bubble. But I have very well mentioned that why increase in price makes sense. Bitcoin is providing a whole new form of currency which is decentralised and online but comes with limited cap. Thus, it is deflationary. Demand will rise naturally because this is something people want. Utility will increase in future with more merchants accepting Bitcoin. Recently a real estate company announced to sell their property in BTC. Soon more will follow. The increase in price is not hollow, but based upon some solid reasoning.

The user base is way too less right now might be near 1% of world's population. Right now the price increase is genuine enough as more people are investing. The potential is high in that sense too as Bitcoin is targeting billions of internet users. Bitcoin will someday be in a bubble, but that time is far away. Right now we aren't in any bubble. Instead, people are using it to park their dollars so central banks cannot destroy their value.

One other thing: financial markets, including those of cryptocurrencies, are always forward-looking.  They're always trying to predict what the future value of the asset will be.  You are correct that bitcoin's potential is high, and that's part of what's driving the price up into what I think is bubble territory, as I said before.  Eventually--even if it takes years and years--price and reality will meet in one of two forms.  Either reality catches up to price (i.e., price stays strong as the intrinsic value of bitcoin increases), or price catches up to reality (i.e., price crashes big time).

People are getting curious on Bitcoin because of its astronomical rise in the last few years that it existed but they also expressed some fear that it can just be another bubble that can pop anytime and its value would crashed to the ground making it useless in the long run. While it is just natural to feel this way we have to understand Bitcoin more and we can see that it is really different...there is nothing like it in the history of mankind and that is why it is really revolutionary in the first place. But words are nothing if we ourselves can never be convinced that Bitcoin is really representing value within.

Now, we can all believe whatever we want to believe and either way we can be right as no one can ever tell us on what to believe in. People who are afraid that Bitcoin can just be another pyramid scam should stay away for it as its volatility can create a heart attack on someone new to the game. Bitcoin can be for everybody but not everybody can be for Bitcoin...that is what we should be learning here.

In the strict sense and meaning of a bubble, Bitcoin is an exemption.

I think you nailed the answer to your own question.  From wikipedia: "An economic bubble or asset bubble ... is trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value." [https://en.wikipedia.org/wiki/Economic_bubble]  If bitcoin has little or no intrinsic value, then certainly a price in the thousands of dollars per coin is trading in a range that strongly exceeds its intrinsic value.

One of the big problems we have is that there is indeed no good way of determining what a bitcoin should be worth.  All of it is speculation.  Some transactions are carried out for non-investing purposes, and bitcoin needs to be worth something for that to work, so I think it's worth more than $0.  But couldn't all of those transactions still work fine if bitcoin were $2000?  Or $1000?  Or less?  It's really hard to know how much, but I think there is a huge investor premium on bitcoin right now.  If all of the speculators disappeared, price would plummet.  Now, that doesn't mean that bitcoin won't become a mainstream currency in the future, and it doesn't mean that bitcoin's price can't go much higher.  But I do think it's likely we're in a bubble...I just have no idea how big it is.

I just don't understand why people consider Bitcoin to be a bubble.

Although Bitcoin has no intrinsic value, but don't forget Bitcoin is disrupting a huge market that is of traditional currencies by making it online and decentralized along with many other benefits that Bitcoin bring with itself and its value will increase with increase in utility. Utility might not be much at the moment, but potential is high. Bitcoin is not mere a currency that is driven by speculation, but is giving us a whole new form of monetary system.

I think it's important to consider that graph both in the short term and in the long term.  I think we have been in a short-term bubble, which is not as bad as it was a few weeks ago.  But this is normal for bitcoin.  BTC was in a bubble when it first hit ~$30 and then crashed.  It was in another when it hit ~$250 and then crashed; same with the first time it hit ~$1k and then crashed.  This is just another short-term bubble cycle.  Long term, I think it's harder to say where we are on that graph, but I think we still have a lot of potential growth left.  When institutional investors start investing in bitcoin en masse, I think that's when we'll hit that "New paradigm" peak.

Anyone who thinks Bitcoin has magically outgrown bubbles is off their tits. There will always be bubbles on the way to some sort of saturation. The question is have the bubbles massively slowed down, is BTC not in one at all yet or have they been outsourced to alts?

I well and truly thought alts were in a bubble but they themselves are amazingly steady considering how much they've risen. It's possible that the bubbling has been met equally by a large number of new users who've countered the exuberance.

So dunno is my answer.

Quite clearly not in a bubble, even the China news couldn't keep bitcoin down for long.

How does it make me happy. Today I entered the stock exchange account and was pleasantly surprised by the rapid growth of the main crypto currency.
Bubbling again inflated)

I am just going to say this: calling bitcoin bubble a million times does not make it a bubble.


the FUD is already priced in and this is the beginning of the week and everyone is back on the rally wagon to the moon. price is currently testing the old $4000 resistance. we shall see what will this day bring us. but I can say with certainty that the down trend is mostly over.

I haven't been watching the Speculation forum for a while. I'm glad to see that these types of threads are still being posted all the time. It means that Bitcoin has quite a lot more upside left.


Well, a lot of the FUD is priced in. But there is still a scary rumor floating around that China will actually move to block Bitcoin and other blockchain networks within the Great Firewall. Crazy if true. If that's the case I wouldn't be surprised to get another brutal leg down before we consolidate and form a base for another rally.

Nope, we back in the bull market again cos it seems the FUD about chinese is fading away. The only way is up for bitcoin and altcoins.

Well, which bubble can now be spoken, well, it fell almost twice, due to many reasons, many have already started selling, in the future I think they realize their mistake, but this is not a reason to inflate all sorts of thoughts. The climb is not far off, or rather already, so do not panic.

sigh...
many people always asked unnecessary question and this picture from time to time,
Bitcoin still has a lot of room to grow and basically this picture does not work with it.
Bitcoin in general always in a bullrun,but because of some drama price was declining(it happened because they want to get cheap Bitcoin and then holding for a longrun).
it's not bubbling right now and for a few years latter it will not,until we find the true price for Bitcoin and implemented by people.
so for now,it is not

again with this picture! at best we are in the Awareness Phase and in the first "Bear Trap"

and if that is not sufficient then look at the charts and how price changed!
price went from $4979 to $2972 that is $2000 drop or 40%!
if you still think there is a bubble then you don't understand what a bubble means!