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Money The only thing rising faster than Bitcoin's price is the number of people who think it's a bubble

00:22  01 december  2017
00:22  01 december  2017 Source:   businessinsider.com.au

Crypto Bull Tom Lee Doubles Bitcoin Price Target to $11,500

  Crypto Bull Tom Lee Doubles Bitcoin Price Target to $11,500 The bitcoin bulls are charging. A day after hedge fund manager Mike Novogratz said the cryptocurrency will end the year at $10,000, Fundstrat’s Thomas Lee doubled his price target to $11,500 by the middle of 2018 -- a 40 percent gain from current levels.Lee, who heads research at Fundstrat, said a 10 percent pullback earlier this month triggered by the controversial cancellation of an upgrade to bitcoin’s underlying software has set the stage for the coming surge.The November slump “cleaned up weak hands,” Lee wrote Wednesday in a note to clients that almost doubled his last forecast.

“ It is another feature of the speculative mood that , as time passes, the tendency to look beyond the simple fact of increasing values to the reasons on which it That appears to be what’ s happening now with people continuing to pile in despite Bitcoin ’ s price jumping over 250% since mid-September.

The Bitcoin bubble is now screaming too loudly to ignore. The boom bust nature of the And it has revealed flaws about the cryptocurrency that I think will keep it from being more widely embraced as This is a Ponzi scheme, and the number of people who think Bitcoin is a good investment simply

Is this what Bitcoin's future really looks like?© DOMINIQUE FAGET/AFP/Getty Images Is this what Bitcoin's future really looks like? Bitcoin mania is showing few signs of slowing down with prices surging to $US11,390, an all-time high, on Wednesday.

About the only thing rising faster than the cryptocurrency is the number of people who think it's a bubble.

Look at this chart, showing the Bitcoin price overlaid against Google searches for "Bitcoin bubble".

a screenshot of a cell phone© Provided by Business Insider Inc

Many are sceptical of the speed of the price move, including John Higgins and Kerrie Walsh, analysts at Capital Economics.

While admitting they don't know how long the mania will last, they say it is exhibiting a defining feature of asset bubbles historically: people are buying on the expectation that prices will continue to surge.

Bitcoin Blows Past $12,000

  Bitcoin Blows Past $12,000 Photo. Getty Images The Bitcoin bubble continues to stretch to even more grotesque proportion s, clearing a value of at least $12,007 per bitcoin and attaining a market cap of $200 billion on Sunday, TechCrunch reported. The strong gains more or less put Bitcoin on a path to clear a value of $13,132 by the end of calendar year 2017, and potentially even more.While doomsayers have been predicting a massive crash in the cryptocurrency market for years, Bitcoin has largely continued its trend of explosive growth - for now.

But it ' s only that: a chance. Bitcoin isn't actually good at these things right now, and it might never be. That's created a long line of people waiting for their bitcoin deals to clear — a line that you have to pay The only thing bitcoin is actually good for is getting people excited that it will be good for

But the dominant reason at the moment is that it is rising in price . A possible explanation is the belief that blockchain, the technology that underlines Bitcoin People are buying Bitcoin because they expect other people to buy it from them at a higher price ; the definition of the greater fool theory.

"The surge in the price of the cryptocurrency over the past couple of months in particular seems to have had a lot to do with speculation that demand for it is set to increase and little to do with a reassessment of its fundamental value," they said in a note released after Bitcoin's surge above $US10,000 earlier this week.

  The only thing rising faster than Bitcoin's price is the number of people who think it's a bubble © Provided by Business Insider Inc This is a salient feature of bubbles, as J.K. Galbraith noted in his seminal work on the Great Crash in 1929. "It is another feature of the speculative mood that, as time passes, the tendency to look beyond the simple fact of increasing values to the reasons on which it depends greatly diminishes. And there is no reason why anyone should do so as long as the supply of people who buy with the expectation of selling at a profit continues to be augmented at a sufficiently rapid rate to keep prices rising."

That appears to be what's happening now with people continuing to pile in despite Bitcoin's price jumping over 250% since mid-September.

Until people stop believing that others will buy at even higher prices, the rally could go on for some time yet.

However, as seen in other asset bubbles in the past, when sentiment finally turns, the subsequent price decline is often more rapid than the rally which preceded it.

Bitcoin surges above $15,000 after climbing $2,000 in 12 hours .
<p>Bitcoin rocketed above $15,000 for the first time on Thursday, after adding more than $2,000 to its price in fewer than 12 hours.</p>The largest U.S. cryptocurrency exchange struggled to keep up with record traffic as the price surged, with an upcoming launch of the first bitcoin futures contract further fueling investor interest.

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