This is my personal opinion so take it as you please. The cryptocurrency market currently reminds me of the dotcom bubble. Allow me to elaborate some similarities between what I had observed in the cryptocurrency market today and what I had observed during the dotcom bubble.
Back then, it seems obvious to me that the Internet will be part of the future. During my school days, I skipped lessons to learn HTML and backend coding on my own, through books and practice. Today, it is also obvious to me that cryptocurrencies will play a big part in our lives in the future. Again, I made some sacrifices to focus entirely on Bitcoin Cash.
Now, just because the Internet is the future, that doesn’t mean all Internet startups are going to flourish. As a matter of fact, the majority of Internet startups from the dotcom bubble failed. You never heard of them but many of them failed. Similarly, just because I think cryptocurrencies will be the future doesn’t mean all cryptocurrencies are going to flourish. In fact, I would argue that the majority of cryptocurrencies today will fail and become worthless in the future.
The valuation of dotcom companies back in those days just doesn’t make sense. Back in those days, even if the dotcom companies doesn’t produce any real value to society, they can still raise millions of dollars. I see the same thing today with cryptocurrencies. The valuation of some cryptocurrencies today just doesn’t make sense. Some of them don’t even have a working product! Some of them had exploits where the hacker made off with million dollars worth of crypto and yet the affected crypto price actually went up! When these sort of things happen, I have the impression that we are in a major bubble.
The way the majority of cryptocurrencies move in the same direction also doesn’t make sense. Imagine that prices of Microsoft, Apple, Facebook are tied to Evergrande and when the price of Evergrande moves up, the prices of Microsoft, Apple, and Facebook also goes up. And when Evergrande price goes down, the other stocks also goes down regardless of their actual value.
As with all bubbles, it has to pop some day. And when it does, I believe that the PayPal or Amazon or eBay of the space will start to differentiate itself from the competitors. Similarly, I believe when the crypto bubble pops, Bitcoin Cash will start to differentiate itself from the competitors. I know some people may feel discouraged by the Bitcoin Cash price today but to me, it is an opportunity. During the dotcom bubble, you may feel discouraged if you were holding Amazon stocks. But for a great investor, those times are great opportunities.
I have very little doubt that the price of Bitcoin Cash will surpass BTC within the next few years. In the meantime, I will just continue to accumulate Bitcoin Cash as my retirement plan. Other people see problems, I see opportunities and I hope you can see them too.
Source: read.cash/@MobTwo/my-thoughts-on-the-cryptocurrencies-market-d976babb
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source https://www.reddit.com/r/btc/comments/q8x6as/my_thoughts_on_the_cryptocurrencies_market/
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