Bloomberg co-founder and former Editor-in-Chief Matt Winkler compares the speculation-driven bitcoin price movements of the mid-to-late 1990s, comparing the excuses made by investors for irrational market optimism at the time (1990s) with those offered by today’s cryptocurrency speculators.
Speaking to Emily Chang at Bloomberg Technology, Winkler explained that cryptocurrency investors are trying to use unconventional methods to detect and legitimize the optimistic prices of digital assets.. This is actually nothing new, according to Winkler.
The State of the Bitcoin Market Compared to Dotcom Crash
The so-called “Cash Earnings” used in the dotcom boom We refer to a pricing metric—indeed, it is sometimes an estimate of future revenues and profits for companies that do not own a finished product—Winkler emphasizes that the use of faulty arithmetic to achieve the desired outcome is now emerging as a new or unique method in the cryptocurrency market.
“There is a comparison with Cash Earnings and Bitcoin that I think is valid, which is how people measure pricing, known as true value. where they can’t find standard methods, people do all kinds of mental gymnastics to find that value. Bitcoin is a good example of how hard everyone tries to legitimize themselves when people looking can get close and can’t find its price point, which even Warren Buffet says as a joke.. That’s why we’ve been in this picture before, and I think the dotcom bubble that burst at 200 is a good example.”
As opposed to many dotcom stocks 20 years ago, when asked if Bitcoin could recover, Winkler replied, Noting that there is no one who can see things, he says it is possible to reasonably predict future price movements by looking at fundamentals and arriving at a rough scientific picture of how much value it provides against demand and thus how much value will be given in the market.
According to Winkler, the current volatility in the crypto market is a sign of “noise,” meaning the market is having a hard time finding the signal that shows how assets should be priced.. This situation you ask will continue and even intensify in the near future, as the “noise” is exacerbated by the regulatory vacuum and a measure of existential doubt over the future of the asset class, as well as the rise of emerging cryptocurrency market activity.
Winkler , concludes his interview by pitching his tent in the “Blockchain over Bitcoin” camp, stating that the use of blockchain as a tool that people can use is in itself a definite and identifiable intrinsic value.. This is a perspective shared by key market voices.. Earlier in December, CCN reported on a viewpoint by Morgan Creek CEO Anthony Pompliano that using it as the world’s most secure transaction agreement layer means “it can’t be worth zero”.