06 May 2014 / Benzinga – Robert Wagner, a research analyst at Seeking Alpha, has recently argued that bitcoin is a bubble in the process of popping due to its volatility. That may not be the case, however.
Bitcoin Is A Bubble
Bitcoin is not a bubble. Bitcoin is in a price discovery phase at the moment and the outcome of that won’t be known until bitcoin succeeds or fails. Like Tesla, Microsoft, Dell, Facebook, Apple, Amazon, Google or any other disruptive tech company
, bitcoin has the potential to rise stratospherically if it achieves its potential. Otherwise like Wesabe, ArsDigita and RiotVine, it will be relegated to the dustbins of history and investors will lose their investment.
Bitcoin is designed with a fixed money supply and therefore is designed to increase in value over time, but that doesn’t make it a bubble; that makes it deflationary.
If bitcoin isn’t a bubble, why does the price rise and fall so fast? This is because bitcoin is only five years old. Just imagine what Facebook’s price chart would have looked like from 2004, when it started in Zuckerberg’s dorm room, through 2009 when it was five years old….. Read more
