Today, Bitcoin trades at around $6,500, and Ether at $204. Their combined market caps have shed about $300 billion in value.
That’s basically five Bernie Madoffs worth of losses.
The situation has put crypto investors in quite the bind. As one indicative example, The Wall Street Journal profiled wunderkind crypto investor Olaf Carlson-Wee, who founded Polychain Capital. The fund, which has seen dizzying growth over the past few years turning a few thousand dollars into tens of millions in returns, has lost about 40 percent of its $800 million in capital through investment losses and investor withdrawals.
It’s clear the second blockchain bubble is now complete (the first was the run-up in Bitcoin prices in 2013).
Blockchain’s story so far is the freakish combination of two narratives.
One side, a technology extraordinarily nascent, with limited use cases and almost no ability to scale. The other, a groundbreaking new technology that should be invested in immediately for maximum returns.
The simple answer is that the first is right, and the second is just too early. Much more development is needed to get blockchain where it needs to be, and much more analysis is going to have to be done to figure out where the investment returns are going to be. Search and social ended up being the killer apps for the internet, but the winners in those categories hardly emerged instantly.
Ethereum is not aiming to change world finance, it is offering a platform for applications. Moreover, Ethereum as a project has much more in common with a company offering a product than Bitcoin, which operates as a group that is developing a protocol.
I think that the Bitcoin maximalism position is possible on that basis (one protocol will win) while still being able to look at smart contract platforms as companies.
I look at Ethereum as a company, and the world of companies is one that requires vigorous competition. Without that competition, a company becomes complacent and won’t innovate; why would they?
An inherent property of asymmetric cryptography is that it supports billions, trillions, quindecillion, accounts by johan-nygren
One of the results of the BitCoin mania of the past two years is, is that so-called blockchains are being recognised as practical solutions for certain problem spaces, such as the degree to which