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RE: Why I Buy Bitcoin During Crashes Despite Calling it a Bubble

in #bitcoin7 years ago (edited)

Is it possible that Bitcoin could actually be somewhat more resistant to traditional bubble behavior because of its absurd volatility?

I understand that sounds ridiculous, but there's a lot of opportunity to be had from volatility. I understand that a significant portion of Bitcoin's value is based on long term speculation and altcoin pairings, but how much of Bitcoin's value can be attributed to short term trading opportunities created by volatility?

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Not sure what you mean by this - that volatility is the direct result of the bubble behavior in the first place. There are other factors as well (e.g: Bitcoin's size, market float, etc.), but the emotional market is a huge cause for this volatility.

Even if a significant portion of bitcoins value is based off of short term volatility, this behavior is actual unsustainable as it is too much like a ponzi scheme in which the scheme only works if people are continuously participating in this activity with new money. When major consecutive events happen (Korea FUDD, China banning bitcoin etc...) you have what happens here in which there is a huge shortage of people wanting to come into the market. The difference between this and the bubble popping phenomenon is that the bubble popping will be much worse.