Charles Pahud de Mortanges. Crypto vs. Dot-com: A Comparison of Market Crashes
Social Sciences / Economics / Financial
Submitted on: Feb 04, 2023, 07:12:54
Description: The dot-com crash (2000-2002) and the cryptocurrency crash in 2022 share some similarities, such as the excitement surrounding new tech. But the causes of these crashes are distinct: dot-com crash was due to overvaluation, lack of profitability, and economic downturn, while the crypto crash was due to rapid value increase followed by a drop made worse by allegations of fraud and mismanagement. The recovery process was different too: dot-com had a lengthy period of consolidation and rebound, while crypto crash led to a shake-out, leaving an uncertain future. Despite the uncertain future, cryptocurrencies have already had a significant impact on finance, with established coins like Bitcoin and Ethereum expected to survive while others fade away.