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RE: If the cryptocurrency market is a bubble right now then it is a very small one!

in #cryptocurrency7 years ago

The volatility of crypto far exceeds that of the dot coms, we have already crashed and risen many times. Have we already forgotten that in July the total market cap hit $60 billion? That was from a previous ATH of almost $120 billion. If a 50% drop in the entire market isn't a "healthy correction" or "market crash" then I don't know what is. Let's compare that to 2008, Dow Jones was 14,000 ATH and then crashed to 6,500 in 2009. Pretty comparable numbers. Even the Great Depression was a 55% stock market crash.
The bubbles will burst and they will refill, but to think the entire market is some massive bubble that will burn more than 50% is next to impossible unless a quantum computer hacked every blockchain. And if there was a malicious quantum computer out there I would be far more worried about our military and government computers than cryptocurrencies.

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It will be governments with the quantum computers doing the hacking! I suspect though that the quantum dream is further away than we think.

While crypto's obviously have a very high volatility, I think it's useful to compare their market cap to the fiat money supply. US "M2" money supply (roughly speaking, money in circulation as well as in liquid bank accounts) is currently $13,600B, or roughly 85X more than all crypto's. That's just USD; the Euro M2 is ~$13,300B USD. So just those two currencies are 166x larger. There's a pretty decent amount of room to grow from that standpoint.