Bitcoin: We Are Here

This all feels so familiar. A new technology, huge media attention, hysteria … followed by a price collapse and the majority saying ‘this is the end’.

Let us consider Amazon. Floated in 1997 at ~$2. One year later, the price peaked at nearly $17. Even with stock splits, Amazon’s price per share reached a peak of $106 in 1999 … without stock splits it would have been 12x that. $1272 … 636x its floatation price in 1997.

Following the dotcom crash, when most decided the Internet was a fad and not a business opportunity, Amazon shares crashed to just under $6 ($72 adjusted for splits). This was still 36x its floatation price. Many people got severely burned by investing and then panic selling.

There is little point going on at length about what happened next.  It soon became clear how powerful the Internet was and the opportunity for Amazon as a first-mover and household name.  In Dec 2013 Amazon hit $400 per share, or $4800/share when adjusted for stock splits. 2400x its 1997 float price!

Therefore, Bitcoin’s journey so far feels very familiar.  I believe we can expect everything to happen far more rapidly as all the infrastructure and Internet penetration already exists.

What should we consider Bitcoin’s “float” price? I’ll let you decide!