The cryptocurrency has burst through a historic milestone. But the bulls aren’t bragging, and the bears aren’t finger wagging. So what’s changed? Jonathan ShapiroSenior reporter
Dec 5, 2024 – 4.46pm
In December 2017, the price of bitcoin was flirting with a historic $US10,000 level and everyone was going mental. If you owned bitcoin at that time, you were giddy with greed, and if you didn’t, you were green with envy.
“If you bought 100 coins in the dip of 2010, your $US200 would be worth $US10 million,” CME economist Erik Norland said at the time. “If you didn’t get in until 2013, you would have had to spend $US20,000, but you would still have bitcoin worth $US10 million today.”
That initial $US200 bet would be worth a staggering $US100 million today. That’s enough to make you feel sick, but the sentiment towards the digital currency this time around is very different.
The intense feeling of FOMO – fear of missing out – has subsided. The debate about whether this is the greatest speculative bubble since Dutch tulips or the South Sea Company has cooled down. The crypto bulls aren’t flexing, and the sceptics aren’t lecturing on the stupidity of it all.
Why is that the case? A few theories. One is that the journey to $US100,000 has humbled the digital bulls and bears.
The multiple crashes, the hacked exchanges, the bleakness of the crypto winter and the implosions have left deep scars and shaken out weak hands. Crypto really did get totally out of control.
Meanwhile, the resilience of bitcoin to bounce back bigger and stronger has forced doubters to acknowledge it has enduring appeal. A further reason is that most of the insane money was made in the early days, and we’ve long since moved on.
An investor who bought bitcoin in 2017 has made 10 times their money. That’s impressive, but not nearly as spectacular as the 50,000 times gain from 2010 until that point.
Regulators aren’t just accepting and accommodating crypto, but actively embracing it.
Another explanation may be our ability to adjust to change, no matter how dramatic.
It’s been uncomfortable for some, but the world has changed.
For instance, Donald Trump’s shock election victory in 2016 was hard for some to take, but when he won again in November, there was far less bed-wetting. Even those who don’t like him recognise how and why he’s risen to power.
The same logic applies to bitcoin. It’s been around long enough for the market to accept its place. Investors can buy it if they want to own it, and avoid if they don’t. The crypto debate isn’t nearly as personal as it once was.
So there’s an acceptance that bitcoin is here to stay. It’s now embedded into the market infrastructure.
Cryptocurrencies can be purchased with ease on any major sharemarket exchange. The world’s biggest fund managers have crypto products and are making good money from them.
Regulators aren’t just accepting and accommodating crypto, but actively embracing it. Ironically, its ascendancy to the mainstream was very old-world.
