Cryptocurrency is the word which first comes to mind when talking about exotic investments. The question is: Is this really an exotic investment and how do we even define an exotic investment? The exotic investment brings up the memories of the great Tulip Mania in Holland, which died in 1637. Speculators paraded against the first stock back in the 1600s and here we are today looking at something that is bigger than that. Since the birth of Bitcoin in 2009 for half a cent, the price has hit the high of $4,477.
The general consensus among the investment community is that the price is in a mammoth bubble territory and it would crash. After all, we have witnessed a number of crashes in the equity market since its birth. The NASDAQ, the blue-chip index, experienced a massive crash on the back of the tech bubble when it fell by 78% in the 30 months ending 2002.
The market has not only recovered from that level in the preceding years but it has made record highs, and to date, it is up nearly 26%. Just to put things in perspective, the NASDAQ index is up 486% from its tech crash low. For every trader, the NASDAQ tech crash became the child poster case study for graduate school but the reality is that crashes do take place all the time and in all markets.
Full story at http://bit.ly/2x2kSMK
Source: Forbes
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