Reply to post: Re: If it's a bubble, someone blowing really hard

Bitcoin price soars amid technical troubles for exchanges

Ken Moorhouse Silver badge

Re: If it's a bubble, someone blowing really hard

According to the Wikipedia article linked to earlier, Tulip Mania was disrupted by bubonic plague in a trading exchange. The traded good suddenly became illiquid because of this.

Name any run on a bank. How did it effectively kick-off? When people tried to withdraw funds they had in their account and were told "not today". The currency had effectively become illiquid by that action.

Ponzi schemes end when there are not enough people coming on-board, putting money into the kitty to repay earlier investors.

If Bitcoin conversion into traditional currency were to take a long time to effect, or situations like a Denial of Service were to occur, then people would start to wonder whether their money were safe. With no government willing to act to repay investors/ speculators if Bitcoin defaulted, this is the scenario I envisage:-

So let's say a Bitcoin transaction takes longer than you anticipate to complete. Would you complain on Twitter? With Twitter and fake news fuelling the fire, a slight delay could turn into a positive feedback frenzy, and everyone will want out.

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