A Stale & Inaccurate Simile
Have you grown tired of hearing about how this crypto market is just like the Tulip mania of antiquity? Me too. Though this argument has begun to fall out of favor recently (for good reason) – it has not yet been entirely dismissed.
I’d like to change that – with your help. Leave your counterarguments as comments below, and I’ll pick the best (or most popular) ones and include them at the end of this article. Together, we can put this tired simile to rest.
According to Gwei
To get the ball rolling, I’ll list a few counterarguments I find myself employing:
- Revolutionary. At best, what could Tulips ever have revolutionized? Other tulips? The flower market more broadly? The florist business? Crypto assets and blockchain tech stand to revolutionize almost everything.
- Accessible. Most of the world wouldn’t have had easy access to novel Tulips. They would not have been able to directly participate in the tulip market. The promise of blockchains is that they will be able to impact the lives of so many. Anyone with access to the internet can participate, not just in the market – but in the development, evolution, and understanding of the technology… in real-time.
- Impactful. #1 and #2 above, directly lead to #3. Even in its infancy, crypto is having a huge impact on the way people think about and interact with the world. Remittances are faster and cheaper. So, too, is publicly and irrefutably time-stamping statements and ideas. Accepting micro-payment payments/donations without any intermediary is a reality. The list can easily go on. Sure, tulips were pretty and probably even interesting – but crypto is already impacting more lives, in more ways, than tulips ever could have.
The Wisdom of the Crowd
Another factor is that no other asset class had market caps that were so blown up and with a total supply that’s completely inelastic. Tulips can be grown, stock can be issued, gold can be mined, even from seawater or asteroids at a high enough price.–nootropicat on reddit
It’s certainly true that a “market” for an asset is not the asset itself – markets for distinct assets can behave similarly. However, especially in “speculative markets”, the underlying assets potential and capabilities beyond finding a “greater fool” absolutely need to be considered.
If someone is claiming that the cryptocurrency market today is like tulip mania – then they simply do not understand the potential, nor the capabilities, of crypto assets or the blockchain.
Please help educate them…