In No Way a Bubble

The surprise most often written about in the early days of the internet, was the apparently astounding number of users searching for medical information. According to PEW Research, over any given period, over 80% of internet users search for health-related topics . So did the internet create an overwhelming demand for health information our of thin air?

Absolutely not. All the Internet did was to lower the cost of asking questions, and enabled millions to exercise a demand that has always existed, but could not be provided in a manner regular people could use.

Similarly, the growth in the popularity of Bitcoin, and as a result its price, is the result of an intrinsic demand of people to protect the value of the product of our individual labor. This isn't new, we just now have choices. The story unfolds like this:

Government: OK, citizen, we will provide you an economic playing field in which to work, with rules and guidelines, along with a currency to make transacting business more efficient, and all we ask of you is to pay some taxes.

Citizen: Well then I'll study and work hard but I have a condition if you want me to use your currency. If I am successful in producing more than I consume, I want to save the value of that effort for later use. In the mean-time I don't want you to goof around with the value of that currency, and in effect, stealing the value of my labor. Do we have a deal?

Government: Absolutely, you pay your taxes and we'll manage the value you entrust in our currency.

Citizen: OK, I'll give it a go.

Governments, it turns out, have failed at their end of the bargain and the middle class has been forced to pick up the check. But wait, there's something new on the horizon, an alternative, a second choice. In many way's its a pressure release valve that just might save countries from themselves: Bitcoin and other crypto-currencies.

Bitcoin isn't creating a false demand for a new currency, it is enabling an existing demand to be expressed, and this is why it is no way a "bubble".

Just compare the pattern between US Weekly Bitcoin transaction volume and the growth in cellphone subscribers during the last decade. If that's not convincing, just look at telephone adoption from over a century earlier:

It took 50 years for telephones to exceed 18 million users, and 15 years for cell phones to exceed 300 million users, should we be surprised that Bitcoin is adopting even faster? The added challenge is that this not just happening here in the U.S., it's going on everywhere.

All this talk about a Bubble is simply an attempt to distract people from "looking at the man behind the curtain", and seeing precisely what is happening, and it is BIG indeed!