Hi fellow steemers and crypto enthusiasts!! Today I decided to share my perspective on a different topic today and thats the question of is bitcoin & ethereum in a bubble??
At this moment Bitcoin and Ethereum both are sitting at or close to their all-time highs as we speak and look like they are in breakout mode. Lets take a look at both charts and see what kind of story they show us visually.
Wow they both look like they have risen substantially in a short period of time which may show that we would be entering an asset/crypto bubble but lets ask ourselves another question. From experience when an asset bubble/over valuation of any asset is occurring everyone is talking about it. Probably majority of almost everyone you know from family, co-workers and friends are all talking about it, but for myself i don't know anyone talking about the rise in prices of bitcoin or cryptocurrencies, except i noticed the media is just beginning to cover it which would be a small warning sign.
From experience, asset bubble prices will and can always rise higher than most people can predict, so this could be just the beginning or middle stage of a bubble. An example would be Canada's real estate bubble, nobody can predict when it will end or how high our real estate prices will go, but of course we all know good things always come to an end and when prices of anything rises too fast in a short period of time will always lead to price declines which are also very fast. Example, tech bubble from 1998-2001 in the chart below.
I myself do hold bitcoin and ethereum and believe in the projects/developments that are occurring in this space but sometimes when prices move too fast in a short period of time you must always start to become wary or cautious as there will always be crashes or corrections in all markets. Remember prices don't always move in straight lines. For people holding crypto's enjoy the ride up and always as an investor be more scared of how much capital you may lose than how much you can make!!! Never be afraid to take profits also as no one will ever be able to predict where the top will be and a profit is a profit!!
As an ethereum holder, i'm looking forward to the release of Metropolis!! and for Bitcoin i'm looking forward to the upgrade in the speed for the transaction network.
In the end, I believe we are entering a bubble and probably still has more to go as i don't see the craziness or irrational behaviour of the people around me quite yet. Happy investing steemers and always be careful out there, markets will always try to take away your hard earned money! :)
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