In an article titled “Why Bitcoin Fans Don’t Believe in Bad News,” published by Time, Jacob Davidson reports that Meir Statman, a professor at Santa Clara University specializing in behavioral finance, thinks that Bitcoin is a scam.
The Professor also thinks that Bitcoin enthusiasts suffer from “confirmation bias” (a buzzword often used by politically correct academicians). He believes that Bitcoin communities tend to be echo chambers of optimism, giving their members a false impression of the currency’s true value:
“What you hear, really, is what you want to hear; what is easy for you to believe: That bitcoin is going to take over and banks are a thing of the past. And when you have people who reinforce it, people are not looking for the truth, they are looking for views that are going to support their prior beliefs driven by ideology and self interest and so-on.”
Davidson reports that, on Reddit’s Bitcoin discussion board, the price drop of last weekend was framed as good news, instead of bad news. However, his explanation is much better than the Professor’s explanation:
“Is it possible that Bitcoin’s most dedicated fans are simply more tuned in to the currency’s long-term potential than the broader market and therefore have a more favorable view of its true value?”
Yes. I think this is the correct explanation.
The Promise of Bitcoin
CCN has recently published several articles that put the price of Bitcoin (the only aspect of Bitcoin that is systematically covered by the mainstream press) in a proper context and framework.
Venture capitalist Fred Wilson said:
“I continue to believe that the thing to watch is not the price chart, the volume chart, or any chart. The thing to look at is Github, Hackathons, Accelerators, and everywhere else that entrepreneurs and developers showcase their work. That’s where the future of Bitcoin and its promise will be determined. And right now, based on what I’m seeing, it’s future is very bright.”
Recent articles on CCN also underline the possibility that falling Bitcoin prices signal that the we are entering the first phase of the real Bitcoin economy, and therefore the Bitcoin price drop is good news.
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