With Greater Perspective, The “Crypto Bubble” Isn’t A Bubble, It’s A …….
I’ve written 18 crypto related posts since I saw the crypto light on June 29th. I could have titled most of those posts “what I learned about crypto this week”. After three months, on October 8th, I published my first thought piece “7 Thoughts On Blockchain, Cryptocurrency & Decentralization After Three Months Down The Rabbit Hole”. It’s, by a margin, the most read/clapped for post I’ve written. The 5th thought was “ It’s A Bubble….So What”. I went on to explain:
I say “so what” because I believe in Amara’s Law: We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run. This is part of the reason we get bubbles. We get overexcited about a new technology and we drive up prices beyond any reasonable valuation. Bubble’s can go on for years. The internet bubble lasted 5+ years.
With that thought piece at it’s 3 week anniversary, my thinking has evolved. It feel’s like we’re having a Cambrian Explosion in crypto. Just as the Cambrian period enabled the creation of a multitude of new life forms, the emergence of blockchain, cryptocurrency, and decentralization is opening up a wide range of previously unavailable markets as well as new ways to compete against entrenched incumbents. Sure, most of the new crypto entities coming in to being today will die out, but many of the ones that survive will be epic.
Given that view, I think the three charts below give additional perspective to the crypto bubble debate.