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Many people have stated that bitcoin is akin to tulip mania. It’s not. It is true that cryptocurrencies may be in a mania phase where price is decoupled from productivity, but that does not tell the full story. Blockchain technology, and by extension cryptocurrency, is a technological revolution and it follows the cycle of other technological revolutions like the Industrial Age and the Information Age. At times, I’ll use blockchain and crypto interchangeably. For blockchain technology to change the world, it must be implemented as cryptocurrency. The two are inextricably linked. This article aims to explain the difference between bitcoin (and the entire crypto-asset class) and tulip mania. I intend to show that cryptocurrency, as a technology in concert with other technologies, is driving the next long wave economic cycle. Technological revolutions transform the world and I will illustrate how, when and where cryptoassets fit within that picture.
Bitcoin was the first “killer app” of a technology called blockchain. Bitcoin brought forth something innovative by creating a global system to digitally transfer and store value. It does this through its design by using decentralization, immutability, incentivization in novel ways that allow commerce transactions without the need of a trusted third party (i.e. like a bank). Moreover, the next generation of cryptocurrencies…
