Re: Crypto is more like “a psychological experiment than a serious investment"
Robert Shiller, professor of economics at Yale University and co-founder of the Case-Shiller Index, expressed his idea about cryptocurrency.
"I'm interested in bitcoin as a sort of bubble. It doesn't mean that it will disappear, that it'll burst forever. It may be with us for a while," said Shiller.
"To me, it's interesting as another example of faddish human behavior. It's glamorous," he added. The bitcoin craze reminds him of tulip mania in the 17th century, the event which is considered one of the first recorded speculative bubbles where a buying frenzy and lofty expectations replace rational justifications for an item's value.
The price of bitcoin grew so fast. The cryptocurrency hurtled above $1,000 in early 2017 after trading at less than a $1 at the beginning of the decade. It even hit an all-time high north of $20,000 in mid-December. (recommend FuninUSA for updated data about cryptocurrency)
A lot of people have benefited from the cryptocurrency investment. But Shiller would still like to see it as a psychology experiment. It is more psychological than something that could be explained by the computer science department, He said.
Bitcoin held above $8,000 on Friday morning after topping that level a day earlier. The two-day rally comes after a weak start to April likely tied to tax-related selling. Prices dipped below $7,000 earlier this month.
Will the bitcoin disappear? What's the true value of bitcoin? What essence in bitcoin are we paying for?
"I'm interested in bitcoin as a sort of bubble. It doesn't mean that it will disappear, that it'll burst forever. It may be with us for a while," said Shiller.
"To me, it's interesting as another example of faddish human behavior. It's glamorous," he added. The bitcoin craze reminds him of tulip mania in the 17th century, the event which is considered one of the first recorded speculative bubbles where a buying frenzy and lofty expectations replace rational justifications for an item's value.
The price of bitcoin grew so fast. The cryptocurrency hurtled above $1,000 in early 2017 after trading at less than a $1 at the beginning of the decade. It even hit an all-time high north of $20,000 in mid-December. (recommend FuninUSA for updated data about cryptocurrency)
A lot of people have benefited from the cryptocurrency investment. But Shiller would still like to see it as a psychology experiment. It is more psychological than something that could be explained by the computer science department, He said.
Bitcoin held above $8,000 on Friday morning after topping that level a day earlier. The two-day rally comes after a weak start to April likely tied to tax-related selling. Prices dipped below $7,000 earlier this month.
Will the bitcoin disappear? What's the true value of bitcoin? What essence in bitcoin are we paying for?
He's literally grasping at one event, of the 2017 bull market. Obviously, after such huge surges in price, a bear market was bound to kick in and prices could not have been sustainable at such high levels. The crypto bull market was definitely fueled by fomo buying, as with any investment, even stocks. But bitcoin itself is not a "psychological experiment".
Its value comes from the fact that it is decentralized, and that nobody can manipulate with the supply, unlike fiat currencies.
I just simply don't see how a comparison of tulips to bitcoin is fair, when bitcoin is a practical currency that has already benefited a lot of people because of its convenience of sending money, and also as a store of value. Bitcoin is a serious investment, you'd be proven wrong if you think otherwise with time.