Just about 10 days ago, I wrote about the Bitcoin being a bubble. And since then, few things happened:
- The bubble has now gone into public euphoria stage, witnessed by an ever-growing number of discounted brokerage platforms actively selling access to Bitcoin markets with leverage in excess of 100:1.
- The bubble has gone from hyperbolic to hyperbolic+ trajectory, adding a massive degree of volatility to the trend. Earlier this week, Bitcoin managed to drop some 21 percent within a day and then go back above pre-drop levels within less than 24 hours. The confirmation phase is now complete with buy-on-the-dip ‘investors’ triggering waves of herding.
- And the hype has gone institutional. In my post, I said “This is not just a shoe-shine-boy moment, folks. It is white-powder-under-the-nose-and–empty-bottles-of-vodka-on-the-floor hour for high school dropouts with cash to burn.” Yeah, read this from as always excellent Matt Levine of (not always excellent) Bloomberg View: “One of the presenters at the conference… “Decentralization will change more in our lives over the coming years than possibly any other technological shift we’ve seen,” he says, likening the crypto rush to the Reformation. He describes building anarcho-capitalist city-states on the back of the blockchain. “If you’re going to built a new city, you’re not going to have the DMV – we don’t like the DMV,” he says at one point. Later: “We can actually tokenize the moon with a startup society.” When I ask him about the SEC’s role in the space, he waves the question off as irrelevant. “Under crypto-anarchy,” he explains, “we’ll get to determine the government that we want.”” Nasa should worry now, not just the SEC, for one day, the International Space Station will have to be flying through clouds of Bitcoins spread around space by the Moononizers of anarcho-capitalist-libertarian variety who securitized their moonhomes using blockchain contracts enforceable only under the anarchy laws.
Yes, bottles of vodka are empty now. ‘Investors’ have moved onto magic mushrooms.
Article Categories:Macroeconomics Blogs