We Are NOT In A Bubble
A lot of people have been going on about the crypto world being in a bubble and I feel we are nowhere near even close to being in a bubble.
Here's my thinking. First we have to look at what a bubble is:
An extract from investopedia defines a bubble as:
What is a 'Bubble?
A bubble is an economic cycle characterized by rapid escalation of asset prices followed by a contraction. It is created by a surge in asset prices unwarranted by the fundamentals of the asset and driven by exuberant market behavior. When no more investors are willing to buy at the elevated price, a massive selloff occurs, causing the bubble to deflate. (Read more: Bubble http://www.investopedia.com/terms/b/bubble.asp#ixzz4kkcS38Ud)
The key words above are: "When no more investors are willing to buy at the elevated price"
Now, when we look at all the new investors coming on board the crypto train we have to wonder when the buyers will dry up. Well it's not going to be any time soon.
A recent survey conducted by the HSBC states that 59% of 3,000 people surveyed around the world hadn't even heard of 'Blockchain' and of the people who had heard of it, 80% did not know what it was.
BUT
If we take a look at Google trends for the terms: blockchain, bitcoin and cryptocurrency here is what we see:
That means more and more people want to know about this new fandangled financial thing that people are making money with. They're asking the questions, the right questions, which will see more and more people getting on the crypto train.
This is good for us
We all know what a housing bubble is, and what a stockmarket bubble is and it really looks at the majority of people knowing about a certain financial system like the housing market and the stockmarket.
With the crypto market, most people haven't a clue about it yet. We think a shit load of people know about it, only because we're wrapped up in this world, but comparatively speaking nobody knows about the crypto world.
I recently did a facebook live and asked how many people of the 200 live viewers knew about bitcoin or had heard of crypto currencies. Of the 200 viewers, around 5 people had heard of bitcoin and nobody had heard of cryptocurrencies.
So we have a long way to go before we are in a bubble.
The giant world of crypto hasn't even woken up yet, but when the majority of people start to learn about them and the crypto world makes it less technical and easier to buy cryptos then you can be sure the cryptos are all going to shoot up.
When we reach the tipping point of most people knowing about cryptos then we should start worrying, but I don't see that happening for a good few years yet.