Its supporters are loath to hear the word, but an increasing number of economic analysts are tracking what is known as the Bitcoin Bubble. The idea went viral last month when Convoy Investments formulated a chart tracking the relative worth of various economic bubbles in human history, stretching back hundreds of years, and marked out the largest and, frequently, most destructive. One month later and Bitcoin’s value has continued to increase, and Convoy has released an updated chart depicting the relative positions again.
Bitcoin is now worth 64 times what it was three years ago, officially passing “Tulip Mania” of the 17th century. Howard Wang and Robert Wu, who are the principals of Convoy, highlighted that Bitcoin has near doubled since the chart made last month. Strikingly, it has grown at five times the rate of the infamous South Seas bubble of the 18th century, a crash so enormous the government of the United Kingdom still pays debt on the catastrophe.
There are other words of warning, things like Bitcoin Futures and Derivatives have popped up recently, warning signs for most long-term investors.
There is some wiggleroom. Mike Novogratz, an expert pioneer in crypto-currencies, has stated he believes Bitcoin to easily reach $40,000 before it finally bursts. That’s still a fair amount to grow from its current position just under $20,000, and enough time for the squeamish to save their skins. All that remains hidden is how far the crash will fall.