Bitcoin Surpasses Netflix in Value in Market Capitalization

Bitcoin is often compared to Tulipmania – the world’s first financial bubble – in the Netherlands in the 17^th century. During this time, the contract prices for tulips reached their monumental peak and then drastically collapsed in a week, causing tulip holders to declare bankruptcy. This is generally the model that defines all financial bubbles. Assets, both good and bad, drastically appreciate in value way beyond their worth because of investor psychology or the hype surrounding an asset. Once the pool dries up, and there is no longer a demand for the asset, those who remain in possession of it begin a hysterical sell-off for less than a fraction of the money they paid.

Bitcoin is considered the most successful cryptocurrency in the world and was the world’s pioneer in blockchain-based cryptocurrencies. It was launched in 2009 and cost next to nothing at the time before it began to fluctuate. As a variety of events, such as the Mt. Gox default, the Silk Road collapse, the market crash, a broader consumer market, and others unfolded, Bitcoin’s price surged.

There has been plenty of speculation about the burst of the crypto bubble, and for the most part, it’s all come true. The difference is crypto keeps resurfacing. It was only three years ago when Bitcoin got its sixty seconds of the spotlight and soared to an all-time high value of $19,783 but then slowly began its decline to $3,441 by January 2019. It is now November 2020, and Bitcoin has just dashed past $15,000 taking its market capitalization at $74 billion, Netflix is valued at $72 billion, and American Express at $78 billion.

Events that most likely attributed to the climb of Bitcoin:

1: The interest in cryptocurrency grows as the dollar weakens. Many professionals, such as JP Morgan, believe that Bitcoin may even surpass gold in popularity.

2: Venezuela had been struggling with an economic crisis for years when the COVID-19 pandemic showed its ugly face and practically wiped out the country’s economy. In an attempt to fence off massive inflation, Venezuelans have increased their use of Bitcoin.

3: Iran has also recently adopted Bitcoin for international trade as the US sanctions intensified, the COVID 19 pandemic rose, and the threat of a global economic crisis grew closer.

4: Bitcoin continued its surge, reaching a whopping $15,000 on the post-election day. The demand for cryptocurrency is further fuelled by the hyperpartisan divide, mistrust in the government, and election turbulence in the United States.

5: Many companies, such as PayPal and Square, accept Bitcoin as an operable payment method, while the Swiss Gazprombank recently launched Bitcoin trading.

As it’s currently shaping up, the next bull run will be led by BTC with the very narrative that OGs have been saying since 2011:

Bitcoin’s hard supply cap makes it a durable SoV as governments devalue their fiat currencies to support unconstrained government spending.
— Tyler Reynolds (@tbr90) November 7, 2020

Bitcoin’s incredible performance boosted the value of other cryptocurrencies like Ethereum, which is currently trading at $450. Investors and governments deem Bitcoin a great inflation protector, but will the Millennials follow this hype – perhaps out of a fear of missing out? Only time will tell. Many things hang in the air right now, but one thing that we can say with certainty is that everybody can speculate plenty about crypto, but nobody puts crypto in the corner.

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