Bitcoin Outshines Tulip Frivolity After 17 Years of Proven Resilience, Claims ETF Expert

Bitcoin buries the tulip myth after 17 years of proven resilience says ETF expert

Over the past 17 years, Bitcoin has demonstrated remarkable endurance that sets it apart from historical asset bubbles, such as the Dutch tulip mania, argues Eric Balchunas, an ETF specialist at Bloomberg. Despite various critiques and comparisons, Balchunas asserts that Bitcoin's resilience is unparalleled, highlighting its ability to endure market fluctuations and challenges.

Key Takeaways

Eric Balchunas, Bloomberg's ETF expert, argues that Bitcoin should not be compared to the Tulip Bubble due to its long history of resilience.
Tulip mania lasted only three years, marked by a rapid rise and a dramatic collapse.
Balchunas asserts that Bitcoin, despite market fluctuations, maintains a substantial value compared to its historical average.
Bubbles do not survive multiple market cycles, regulatory obstacles, and significant shifts, which Bitcoin has successfully navigated.

The Fallacy of the Tulip Comparison

According to Eric Balchunas, Bitcoin can no longer be likened to historical bubbles such as the "Tulip Bubble." In a recent statement, Balchunas emphasized, “I personally would not compare Bitcoin to tulips, no matter how bad the sell-off.” He elaborated that unlike the tulip market, which saw a rapid rise and collapse within a few short years, Bitcoin has proven to be much more resilient over time.

Reflecting on past comments from notable investors, Balchunas mentioned that figures like Michael Burry of “The Big Short” fame and JPMorgan CEO Jamie Dimon have previously labeled Bitcoin as the "tulip bulb of our time." Dimon had notoriously described Bitcoin as “worse than tulip bulbs” and a “fraud” back in 2017.

The Brief Life of Tulip Mania

The tulip mania in the 17th century Netherlands is often referenced as one of the earliest recorded speculative bubbles. During this period, tulip bulbs—originally brought to Europe from Turkey—became luxury items and status symbols among affluent merchants. Prices began to surge in 1634, hitting a peak in 1636, when specific rare bulbs were valued at more than the cost of houses in Amsterdam. However, in 1637, the market crashed dramatically, with prices plummeting over 90% in a matter of weeks.

Tulip mania only lasted three years. Source: Eric Balchunas

Bitcoin: A Different Story

Balchunas also points out that Bitcoin's performance this year has merely reflected a healthy correction after the "extreme excess" of the previous year. He argues that even if 2025 concludes with little growth or moderate declines, Bitcoin is still significantly above its annual average, operating at about 50% of its previous highs. He suggests that it is natural for assets, including stocks, to experience cooling periods, noting that “people are overanalyzing it.”

Additionally, Balchunas challenged the notion that Bitcoin is non-productive. He noted that tulips were defined by short-lived euphoria followed by a crash, whereas Bitcoin represents a different reality. Garry Krug, head of strategy at the German Bitcoin treasury firm Aifinyo, supported this perspective, stating, “Bubbles don’t survive multiple cycles, regulatory battles, geopolitical stress, halvings, exchange failures and still return to new highs.”

In conclusion, the ongoing debate surrounding Bitcoin and its comparisons to historical asset bubbles reveals a broader misunderstanding of its unique characteristics and long-term viability.