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Comment by soniman | Hacker News Reader

Bitcoin is now at the peak of the hype cycle. A lot of the 23 year old traders don't know anything but a bull market. When it inevitably goes through a bear market, like every other asset, when there is $50 billion of sellers higher ready to sell on every uptick, what brings bitcoin back? Stocks very rarely come back from 70-80% declines, unless the stock is Amazon or similar. All the hodlers are going to turn into baghodlers if they don't sell pretty soon.

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1- Bitcoin is not stock so comparing with stock has no weight in your argument

2- It has already been on a very long bear market (2013-2015) where everyone said pretty much the same thing (fad, tulip, the experiment failed .... ). So yeah the new holders will go through rough times but your argument that it reached the peak of the hype cycle has no logical facts to support it since you could have said the same in the peak of 2013.

If anyone knew when the peak is(was or will) would not be here commenting on HN or talking about it but rather selling this knowledge ... and this holds true for any investment.

You're right, I have no idea when the top is going to be. My point is that bear markets have a very different feel and can be emotionally devastating if you're in the middle of one and bitcoin has not been through that and made it to the other side. Are the bitcoin boys ready for that? Because it's coming, sooner or later.

The exact sequence of events you are describing happened between 2013-2016 when Bitcoin fell from a hype induced >$1000 to (at its lowest) $200, and didn't rise above $1000 until this year.

It clearly did not kill Bitcoin, and Bitcoin won't die if the same thing happens again.

And before that, it hit a high of $31 and crashed to $2, and slowly recovered to $13 over the next year.

Ethereum crashed from $21 to $7 last year after the DAO theft. A couple months ago it went from $420 to $130.

Many of the "bitcoin boys" won't be ready for that. But that doesn't mean Bitcoin will fail. It does mean that many people investing in it are set for massive pain, though.

Do you have a short position on Bitcoin?

Possibly, although we haven't really seen how Bitcoin performs during a 2008-like recession, either, and the market (sans Bitcoin) is already becoming due for a downturn.

I also think it's a little silly to categorize Bitcoin owners as 23 year old traders. It has a $95 billion market cap. I think there's a lot more traders than just 23 year olds.

> Stocks very rarely come back from 70-80% declines, unless the stock is Amazon or similar.

FWIW Bitcoin has already come back from a >85% decline at least twice, if you use intra-day data.

Another perspective - this might be a new bank run. We haven't seen one in the last century.

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