Bloomberg Calls Bitcoin a ‘Digital Tulip’ — Why Eric Balchunas Disagrees

In December 2025, Bloomberg revived an old comparison by likening Bitcoin’s price swings to the 17th-century Dutch Tulip Mania, sparking a heated debate. In a recent op-ed, columnist Merryn Somerset Webb likened the world’s most famous cryptocurrency to the 1630s flower frenzy that ended in financial ruin.

In response, Bitcoin advocates pushed back, most notably Bloomberg’s senior ETF analyst, Eric Balchunas, who pointed out that Bitcoin’s 17-year history of multiple booms and busts sets it apart from a one-off flower frenzy.

In his view, Bitcoin’s recent dip is merely a retracement of last year’s gains, not a “punch to the face” knockout like the tulip crash. Below this article explains what Tulip Mania really was, how Bitcoin differs (or doesn’t), and what experts, from Balchunas to Dan Held and Robert Kiyosaki, say about the comparison.

What Was Tulip Mania?

Tulip mania (1634–1637) was a Dutch Golden Age speculative bubble in rare tulip bulbs. As historical data show, tulip contract prices skyrocketed in 1636–1637, by some accounts roughly 20× in just a few months, then crashed about 95% by spring 1637.

In other words, one dramatic spike was followed by one catastrophic crash. After that peak, prices never came close to the 1637 highs; they simply reverted to normal levels. It is generally considered the first recorded asset bubble.

Importantly, modern research shows the Tulip episode was short-lived and limited. It involved only a few hundred wealthy speculators (merchants and artisans) and lasted only months at peak intensity. The broader Dutch economy, then Europe’s richest, felt almost no lasting shock. 

Historian Anne Goldgar found “not a single bankrupt whose ruin could be pinned on tulipmania” after combing archival records. In fact, many peak tulip trades were futures contracts (not actual bulbs) that speculators could cancel for a small fee when prices collapsed.

Put simply, Tulip Mania was a contained fad, not a systemic crisis. Its legend was inflated by later writers (e.g. Mackay) into a cautionary morality tale. As Goldgar notes, the tulip fable has since been “weaponized by people who want to dismiss any asset they simply don’t understand. Including Bitcoin.”

Bitcoin vs. Tulips: Key Differences

Bitcoin and 1630s tulips share one superficial trait (neither pays dividends), but they differ fundamentally. Some key contrasts are:

• Timeline and cycles: Tulipmania was roughly a 3-year craze (1634–1637). Bitcoin launched in 2009 and has now endured 17+ years, including three four-year halving cycles and multiple boom/bust swings.
• Price dynamics: Tulip prices saw a single spike-and-crash (roughly 20× up, then ~95% down). Bitcoin has suffered steep corrections (even 80–90% declines) but recovered repeatedly, hitting new all-time highs after each cycle. Balchunas notes Bitcoin “has been hit hard six or seven times, but it has always bounced back.”
• Asset nature: Both are non-productive (no cash flow). But Bitcoin is a digital network and store-of-value (often compared to gold) with scarcity (21 million cap), security, divisibility and broad utility. Tulips were just novelty flowers with no further use. As Balchunas asks rhetorically: are gold or art productive? If not, why compare only them to tulips, but not Bitcoin?
• Economic impact: Tulip trading was a niche sideline with minimal spillover. Bitcoin is woven into modern finance (crypto exchanges, wallets, ETFs, even national policy talks). Institutional investors like Ray Dalio and companies like Strategy now hold Bitcoin, far beyond the small Dutch tulip market.
• Cultural context: Tulips were a luxury fad of 17th-century Holland; Bitcoin is a global digital phenomenon. The internet age and blockchain technology give Bitcoin a very different context than any historical flower market.

These factors matter because, as Heritage Foundation columnist Paul Mullen argues, Bitcoin is built on a “firm foundation” (decentralized ledger, censorship-resistance, fixed supply etc.) that “not a lot of tulip bulbs (or fiat currencies) have.” Thus, Bitcoin has technical underpinnings and repeated stress-tests that tulips never did.

Eric Balchunas: Bitcoin Isn’t “Digital Tulip Mania”

Bloomberg’s Eric Balchunas has been vocal against the tulip analogy. On social media, he stressed that Bitcoin’s resilience invalidates the comparison. 

For example, he tweeted: “Tulips were speculators for three years, and they popped once in the face and got knocked out. Bitcoin came back from like six or seven haymakers to reach all-time highs and has survived 17 years.”

In his view, “this resilience alone is enough to invalidate the tulip metaphor.” He also called the idea of comparing Bitcoin to tulips “lazy analysis”, noting that Bitcoin is still up roughly 250% over the past three years (122% gain in 2024 alone) even after the recent pullback.

Balchunas further questioned the popular critique that Bitcoin is “non-productive” like tulips. He pointed out that many non-productive assets (gold, art, rare stamps) hold value without generating cash flow. 

“Yes, Bitcoin and tulips are both non-productive assets. But so is gold, so is a Picasso painting, rare stamps – would you compare those to tulips? Not all assets have to ‘be productive’ to be valuable,” he wrote.

In his words, “Bitcoin is a completely different asset” from tulips. He even quipped that the Tulip storyline is sometimes driven by sentiment: “Some people just hate this asset and want to enrage the people who like it,” adding that such scorn will “probably never change.” 

In sum, Balchunas argues Bitcoin’s long track record and institutional adoption make the “Tulipmania” label misleading.

Why the Tulip Mania Comparison Fails to Explain Bitcoin’s True Value

Since 2014, Bitcoin has experienced four major drawdowns greater than 50%, with the three largest averaging roughly 80% from peak to trough. 

Researchers identify four primary Bitcoin market peaks, in 2011, 2013, 2017, and 2021, each followed by deep corrections of around 75% or more. 

Despite these steep declines, Bitcoin has consistently recovered and gone on to reach new all-time highs after every major downturn. Notably, it surpassed its 2021 record in March 2024 and continued to climb higher later that year.

In contrast, tulip contract prices during the 17th-century Tulip Mania collapsed abruptly in February 1637 and never recovered. The entire craze lasted only about three years, from approximately 1634 to 1637.

Bitcoin or Tulips? What Leading Economists and Investors Really Think

The Bitcoin-vs-tulip debate has many voices. Some echo skeptics, others defend Bitcoin:

• Dan Held (Bitcoin advocate): He publicly slammed Bloomberg’s Tulip comparison as outdated. Held tweeted that it was “embarrassing” to see reputable outlets still peddling the Tulip bubble analogy in 2025.

• Robert Kiyosaki (author): He warned in mid-2025 of an “everything bubble”, tweeting “When bubbles bust… Bitcoin will bust too. Good news… If prices of gold, silver, and Bitcoin crash… I will be buying.” In other words, Kiyosaki expects a Bitcoin crash but views it as a buying opportunity.

• Robert Shiller (Nobel economist): Shiller has called Bitcoin “the best example of a bubble”, while admitting he “doesn’t know what to make of it”. He told Investopedia Bitcoin “might totally collapse and be forgotten”, or conversely “it could be here in 100 years.” Notably, Shiller observed the crypto boom “has been likened to ‘Tulip Mania’” of the 1630s.
• Paul Krugman (Nobel economist): Krugman has been a long-time Bitcoin critic. In 2017 he told a Business Insider interview that Bitcoin’s run-up was “even more obvious, I think, than the housing bubble,”suggesting it’s a clear speculative bubble.
• Michael Burry and Jamie Dimon: Even high-profile investors have used tulip imagery. “Big Short” investor Michael Burry labeled Bitcoin “the tulip bulb of our time,” and in 2017, JPMorgan CEO Jamie Dimon once called it “worse than tulip bulbs” and a “fraud.”

• Other analysts: For example, Garry Krug (Aifinyo strategist) agrees with Balchunas that Bitcoin is not just a one-shot bubble. He notes bluntly that “bubbles don’t survive multiple cycles, regulatory battles, geopolitical stress, halvings, exchange failures and still return to new highs,” a fate which has so far befallen Bitcoin but not tulips.

Each expert brings a perspective, but the divergence is clear: Tulipmania analogies persist in headlines, but Bitcoin defenders highlight the coin’s unique attributes and history.

Bitcoin vs. Tulip Mania: Why the Comparison Is Misleading

In the end, the Tulip analogy is a compelling soundbite but a flawed comparison. Bitcoin’s creators and investors will debate its bubble-like qualities indefinitely, but facts matter. As Balchunas emphasizes, Bitcoin’s longevity and cycles set it apart from a single 17th-century flower craze. 

Even after the latest sell-off, Bitcoin remains far above its early levels, whereas tulip prices never rebounded after 1637. Observers should remember that many historical “bubbles” (from gold to tech stocks) eventually found their niche, and not every boom means instant doom.

Ultimately, Bloomberg’s Tulip comparison has reignited scrutiny of Bitcoin’s true nature. As one analyst put it, “bubbles don’t survive multiple cycles…and still return to new highs,” implying that Bitcoin (so far) defies the classic bubble outcome. The debate underscores the need to look beyond catchy headlines. 

In Balchunas’s words, Bitcoin “is a different animal,” one with technological underpinnings and 17 years of volatility tests, and any resemblance to tulips is, at most, superficial.

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About the Author

Dr. Guneet Kaur

Dr. Guneet Kaur is a senior editor at CCN.com and a Science Fellow at Exponential Science. She is a fintech and blockchain expert with extensive experience in digital finance education, blockchain ecosystems, and cryptocurrency markets. She has worked with global media such as Cointelegraph, as well as education and blockchain platforms, to design and lead strategic content and learning initiatives. As an educator and assessor for top-tier executive programs, she bridges real-world fintech trends with academic insight.

Dr. Kaur is also a published researcher and peer reviewer across fintech and data science journals, including Financial Innovation Journal and International Journal of Big Data Intelligence and Applications. Her work spans data-driven analysis, Web3 innovation, and technical content development. With a strong foundation in both industry and academia, she translates complex financial technologies into practical applications, empowering learners, professionals, and institutions across the rapidly evolving digital finance landscape.

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