© Reuters. Bitcoin is unlike any other bubble we’ve seen so far
(Bloomberg) – While the jury is still out on whether it’s a bubble, one thing’s for sure: It doesn’t look like any other bubble we’ve seen. Previous episodes of speculative asset inflation were rare, like the tulip mania in the 17th century, or the boom-and-bust cycle took many years, like gold. Bitcoin, by comparison, has survived three peak-to-low dips of more than 80% in less than 10 years. The cryptocurrency surpassed $ 40,000 last week to set an all-time high. It has fallen more than 15% since then. Man Group, the world’s largest publicly traded hedge fund firm, compares Bitcoin to Prometheus in Greek mythology, whose liver keeps growing every time a giant eagle pecks at it. “Every time a Bitcoin bubble bursts, another one grows back to replace it,” Man Group analysts wrote in a note dated January 12. “This same frequency makes the Bitcoin narrative somewhat atypical relative to the big bubbles of the past.” Here is a table of some financial bubbles compiled by Man Group. Read more: “Rather than viewing each individual peak and dip as a discrete bubble, there may be more merit in arguing that this volatility is simply part of price discovery in a new asset class, and that they are not bubbles, but part of a not-so-random walk that will eventually slow down to give Bitcoin more stability and ultimately legitimacy, ”the analysts wrote. © 2021 Bloomberg LP
