Bitcoin is a decentralized digital currency, invented by Satoshi Nakamoto in the form of open source software since 2009. Bitcoin can be exchanged directly using an Internet-connected device without going through an organization. any financial intermediary.
Bitcoin works differently from typical currencies: There is no central bank to manage it, and the system is based on a peer-to-peer network protocol on the Internet.
What is the Dot-Com bubble like?
A stock market bubble when the stocks of high-tech companies, especially network companies, are speculated on. This bubble, according to former Fed Chairman Alan Greenspan, was born on August 9, 1995 when Netscape Communications began listing its shares, and burst on March 10, 2000 when the NASDAQ composite index hit highest peak. The Dot-com bubble contributed, among other factors, to the economic prosperity of the United States in the late 1990s.
Why Bitcoin Rises and FOMO Effect
This is probably the question most investors are interested in. As with Dot-Com stocks, the boom caused the Dow Jones Industrial Average and the NASDAQ composite to consistently hit new highs throughout the years 1995 to 2000. March 10, In 2000, the NASDAQ composite index hit an all-time high of 5048.62 – double its level a year earlier.
The nature of the value of Bitcoin is increasing day by day because the traditional money is pouring in, increasing the total market capitalization, specifically on January 8, 2017 the total market capitalization was about 20 billion USD. , then on January 7, 2018, the total market capitalization fluctuated at 830 billion USD. Thereby, we can easily see the attraction of this new wave of investment, which has grown more than 41 times within a year. A tremendous growth.
The reason why the Dot-Com or Bitcoin storm, the factor that has had the strongest impact on increasing its value is the psychological effect FOMO stands for Fear Of Missing Out, roughly understood as fear of being abandoned or missed. . People with this FOMO syndrome often have feelings of fear that they will miss something. Looking back in the past, from the wave of real estate investment, or as mentioned in this article is Stocks and Bitcoin, when people invest, they panic when they hear the media praising and arguing about the price increase and many people have changed their lives from investing. They are afraid of losing the once-in-a-lifetime opportunity to “get rich” to sell houses or sell cars for investment without having enough knowledge.
What are IPOs and ICOs?
IPO (Initial Public Offering): An initial public offering of securities. The concept of public is understood as a large enough number of investors with a large enough value of securities offered. After the initial public offering, a joint stock company becomes a public company (or public joint stock company).
ICO (Initial Coin Offering): same meaning as IPO but for Cryptocurrency investment market. They all use the same purpose to introduce and promote their projects to the public, thereby raising capital to develop their projects.
If during the Dot-Com bubble, simply adding “.com” to its name sent the company’s stock skyrocketing, even though it didn’t matter the actual technology that the company was. What are you aiming for?
A friend who often invests with me joked: “Today, if a company’s goods or projects do not have capital to operate, just add a Blockchain project or conduct an ICO, then there will be capital. do it now”. Indeed, ICO projects are now so easy to raise capital that they just need to make a Website + White paper (general introduction book about the project) with a few marketing tricks, they can easily pocket a few million USD.
However, it is because of the huge profits from IPOs as well as ICOs that have made it a trend, causing quality control, as well as the “promise” of the project’s mission to float without anyone managing it. physical. In the past, governments could control a bit when there were agencies to check and purge projects that issued bad shares, now with crypto ICO projects, when everything takes place entirely on the Internet, governments can only issue general notices banning ICOs, but can no longer exercise comprehensive control.
At this point, I can’t “confirm” that crypto-Bitcoin is a bubble or when it will “explode” because the potential from Bitcoin is so great and growing day by day. I just want to send the most basic knowledge about the market to you, who are waiting to break into this potential market. Remember, nothing goes on forever, and when you invest, the money you’re winning means someone is losing. History has proven that no matter what kind of “bubble” pops, people will soon forget and focus on the huge profits it brings.
Winners and losers have always been a constant companion for ages, the earth is still spinning and the market is still the same. I don’t want to be the loser and neither do you. Knowledge is limitless and never ends, only those who are truly “predestined” can accompany each other to the horizon of knowledge.