Bitcoin Could Behave like Amazon, Analysts Claim
Can the Bitcoin price follow Amazon’s price pattern? Bitcoin’s price has been under pressure over the last 11 months following a sharp bull-run in the second half of the year. The price of the largest coin has hit a new yearly low of $3,500 last week, but traders are still unsure about the bottom of the bearish trend.
Some analysts are correlating the crypto market price movement with the dot-com bubble; they believe crypto coins’ bubble had already busted at the beginning of the year when crypto coins’ prices started collapsing from their all-time high. The pattern is similar to the dot-com bubble. Tech stock prices had made similar moves in the late ’90s, and the bubble busted completely in fiscal 2000.
Some analysts, on the other hand, don’t believe that there is a similarity between crypto markets and the dot-com bubble.
Angel Versetti said, “While there are similarities regarding overvalued new technology startups with unproven or unsustainable business models that were incessant in both dot-com and crypto, the sheer scale of crypto and dot-com businesses are not comparable. I do not believe we are, or were, anywhere close to a bubble with cryptocurrency.”
If cryptocurrency market is a bubble, then Bitcoin could behave like Amazon. The tech company Amazon was among the biggest drivers of the boom and burst of tech stocks in 90s. Amazon’s share price jumped sharply during 90’s era. The stock had hit $300 in 1998 before collapsing to $6 in 2000. However, Amazon didn’t die after hitting $6 in fiscal 2000. Its price regained momentum, and the AMZN shares are currently trading above $1,500.
Fred Wilson, a well-respected venture capitalist who thrived through the dot-com Boom and Bust, says, “I think some crypto asset (and possibly some crypto assets) will have a price chart like Amazon’s current one in 18 years. But we will have to do what Amazon did, hunker down and build value and survive, for quite a while to get there. And I think things will get worse before they get better.”
The cryptocurrency markets are in doldrums over the past few months; the markets are desperately waiting for positive indicators that could help to end the bearish trend. Bitcoin’s price is currently trading at the lowest level in the past 14 months while altcoins have also experienced similar losses in the past three quarters. On the whole, it’s too early to say that Bitcoin could behave like Amazon as both assets have different market dynamics and business fundamentals.
Do you see any resemblance between Bitcoin’s and Amazon’s price movement? Let us know about your thoughts in the comments section below.