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Bitcoin And The Tulip Mania: Somebody’s Going To Knock Bitcoin Off Its Pedestal Before It Crashes (Picture, Videio
Major publications recognized the news that NASDAQ had licensed its technology to Noble Markets and that Barry Gilbert’s Bitcoin Investment Trust investment vehicle for OTC markets would finally open to retail investors as evidence of digital currency’s coming of age in Wall Street’s eyes.
That doesn’t leave Bitcoin free of critics and competitors, as an expert on the international economy and a new altcoin launching reminded us.
Those thoughts form the basis for this week’s highlights in the Bitcoin world.
Ever hear of Dutch Tulip mania? During the Dutch Golden Age contract prices for tulip bulbs reached extraordinary highs, only to suddenly collapse.
The parallel to Bitcoin is this: Like all currencies, Bitcoin’s price changes with each new trade. The concept isn’t the problem; Bitcoin’s volatility is. In early June of 2014, Bitcoin’s price topped $665. It’s in the mid $200s today. (Figures are in USD.)
That’s why British-born journalist and senior fellow for international economics at the Council on Foreign Relations Sebastian Mallaby compared Dutch Tulip mania digital currency.
Mallaby pulls no punches: “Bitcoin is nuts.” What’s more, to him it’s more like a flavor of the month than a life-changing innovation. MOREHERE
The solution to Wall Street’s 1960s paperwork crisis could also save bitcoin
In the late 1960s, Wall Street had a paper problem. Every time a stock changed hands, a physical stock certificate had to be exchanged as well.
Back then, the securities business relied on a cottage industry of old men, often retired police officers and firemen, chomping cigars in trench coats as they schlepped valises, suitcases and even steamer trunks full of stock certificates—or bearer bonds, or cash—to and fro in lower Manhattan, in New York’s financial district. If a courier was out on the street with a particularly valuable suitcase, the risk manager—he was not a spreadsheet jockey, but rather the guy who managed the metal cage holding the firm’s valuable documents and cash—would ask the other couriers to sit tight until the transaction “cleared” and the other side of the trade was safely back in the bank.
