Do you still compare Bitcoin to the tulip bubble? stop!

Compare Bitcoin (Bitcoin) The perception of the Dutch tulip bulb is to perpetuate the fallacy. Technology is developing faster than nature, and decentralized networks have more financial utility than bouquets. Bitcoin is a technology, and tulips are plants. Anyone with a vision will not make a more in-depth comparison.

Tulipmania was a market bubble in the 17th century. Due to speculation by Dutch investors, the price of bulbous flowers rose and caused a major crash. Prices are six times higher than the average annual income at the time. The rarest light bulb has become one of the most expensive items on the planet.

Although the Bitcoin network has been running since 2009, its comparison with the tulip bubble continues nausea. In February last year, when Gabriel Makhlouf, a British economist and member of the Council of the European Central Bank, talked about Bitcoin, remind Our cliché: “Three hundred years ago, people put money into tulips because they thought it was an investment.”

related: Using quantitative models to predict bitcoin prices, part 4

Tulip Mania

Bitcoin contrarians have used tulip mania time and time again to justify their short-sighted expectations.The story of tulip mania was widely circulated in a book published by Scottish journalist Charles Mackay in 1841 Extraordinary pop delusions and crazy memoirs of the crowd. As McKay wrote: “A golden bait is temptingly placed in front of people, and they rush to the tulip market one by one, like flies in a honeypot.” He continued: “Nobles, citizens, farmers , Mechanics, seamen, servants, maids, even chimney sweeps and women in old clothes, all set foot in tulips.” However, when the tulip bubble burst in 1637, Mackay claimed that the Dutch economy had suffered severe damage.

Although the absurdity of this situation is indeed a good story, scholars have pointed out that McKay’s retelling of the tulip mania may not even be true. This version of the event is particularly unsupported by historians. Anne Goldgar, Professor of Early Modern History, King’s College London Tulip Mania: Money, Honor, and Knowledge in the Dutch Golden Age, Which explains why the versions of Mackay don’t add up.

“This is a great story, and the reason it is great is that it makes people look stupid,” Goldgar said, lamenting that even serious economists like John Kenneth Galbraith A brief history of financial frenzy. He continued:

“But the idea that Tulip Mania caused the Great Depression is completely incorrect. As far as I know, it has no real impact on the economy.”

Internet bubble

In addition to the Dutch tulip mania, the bull market of blockchain technology is sometimes regarded as a bubble similar to the Internet bubble. This is a better comparison, albeit inaccurate.All forms, including encryption, DeFi or Irreplaceable tokens, The Internet of Money has not yet entered the bubble stage or demonstrated all its use cases. We are in the mid-1990s, which is equivalent to the Internet era, and we are far from the bubble stage.

related: Is encryption approaching its “Netscape moment”?

In addition, the impact of the Internet bubble on humans is much smaller than the impact of the Internet, which is the model that blockchain is most likely to follow—especially when compared to tulip bulbs. The past bull market of cryptocurrencies has a more important impact than price increases. In 2013, the world recognized the existence of Bitcoin. In 2017 and 2018, they recognized the existence of cryptocurrency. Since too many projects in 2017 proved to be insignificant-it seems that many projects were just to raise funds-that period of time was nothing more than a preview of what is about to happen.

Comparable to Tulip Mania

The recent bull market from 2020 to 2021 is the first bull market after the initial coin offering (ICO) boom, and it has never been a big bull market that many people are waiting for. On the contrary, just like 2017-2018, it once again demonstrated the possibility of the future, making the blockchain further the focus of attention.

During the upcoming bull market (and possibly a few more years), leading institutions will integrate DeFi and cryptocurrencies. This process has already begun. At the same time, FAANG (Facebook, Amazon, Apple, Netflix, Google) employees saw the text on the wall and withdrew in groups, hoping to build the encryption field through intuitive products.Anyone in the financial world should explore DeFi and think, “If I’m not careful, I’ll be unemployed.” Winklevosses once said that every FAANG company will have its own encryption project. This process is called Hyper-Bitcoinization.

This outflow to DeFi implies that blockchain is the future of financial technology, not just a bubble. We are still so early. During the Internet boom, technicians began to leave the company where they worked, began to build their own ideas and challenge the user experience (UX) and user interface (UI) of the time. Subsequent improvements and UX and UI design simplified the Internet and finally brought it to every home. Talented blockchain programmers and developers are pushing the limits in many verticals. But few people can break the boundaries between UX and UI. Next is.

related: In order to accelerate the adoption of cryptocurrency, we must first improve the user experience

Since blockchain UX and UI are not particularly user-friendly, ordinary institutions cannot yet adopt the system and integrate it into their pre-existing processes. After leaving the green pastures of the blockchain, the talents of Silicon Valley and Wall Street will begin to push things forward. Top funds and projects are considering improving the user experience and user interface of the blockchain for upcoming shows.

Once technicians realize that blockchain is the future, they will bring a unique set of skills that will push UX and UI encryption to drive the boundaries of the Internet. Just like the dot-com era, technology will become easier to use and appear more frequently in daily life.

This article does not contain investment advice or recommendations. Every investment and trading action involves risks, and readers should research on their own when making a decision.

The views, thoughts, and opinions expressed here are only those of the author, and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Jonathan Libby Is the CEO and founder of Steady State. Between enjoying memes and studying the global opportunities that cryptocurrencies must provide, Jonathan is actively establishing a new standard for DeFi insurance. After spending most of his college career at the University of Maine, studying encryption coverage and yield agriculture, Jonathan also helps and educates the U.S. Senate about encryption and alternative solutions from time to time.