In a recent commentary, Eric Balchunas, a senior ETF analyst at Bloomberg, asserted that Bitcoin can no longer be likened to the infamous “Tulip Bubble.” He emphasized that Bitcoin”s longevity and ability to rebound from multiple market downturns distinguish it from the short-lived tulip mania of the 17th century.
Balchunas stated, “I personally would not compare Bitcoin to tulips, no matter how bad the sell-off.” He pointed out that while the tulip market experienced a meteoric rise and a rapid collapse within a mere three years, Bitcoin has weathered several major setbacks over its 17-year existence, ultimately returning to achieve new all-time highs.
He highlighted that Bitcoin has surged approximately 250% over the past three years and was up 122% in the previous year, reinforcing its resilience. Balchunas noted that some critics remain intent on disparaging Bitcoin, suggesting that such sentiments are unlikely to change.
Earlier this month, Michael Burry, known for his role in “The Big Short,” referred to Bitcoin as “the tulip bulb of our time.” This echoes a sentiment expressed by JPMorgan CEO Jamie Dimon in 2017, who called Bitcoin “worse than tulip bulbs” and labeled it a “fraud.”
The tulip mania, which occurred in the Netherlands during the Dutch Golden Age, was characterized by a speculative frenzy where tulip bulbs became coveted status symbols. The market peaked in 1636, only to collapse in 1637, resulting in a staggering drop in prices by over 90% within weeks.
Balchunas argued that comparing Bitcoin to tulips is fundamentally flawed. He mentioned that Bitcoin”s current price adjustments merely reflect a correction from last year”s excessive valuations. Even if 2025 sees a flat or slightly down market, Bitcoin would still operate at around 50% of its annual average, suggesting that assets often go through periods of cooling.
Furthermore, he challenged the notion that Bitcoin lacks productivity. Unlike the tulip market, which was marked solely by euphoria and subsequent crashes, Bitcoin represents a distinct paradigm within the financial landscape. Garry Krug, head of strategy at the German Bitcoin treasury company Aifinyo, concurred, stating, “Bubbles don”t survive multiple cycles, regulatory battles, geopolitical stress, halvings, exchange failures and still return to new highs.”
