Needless to say, what's driving this frenzy isn't the intrinsic value of fart clips or even NBA highlights . Instead, NFT speculators are betting that people in the future will be willing to pay more for their NFT than they did originally because those people will think that someone else in the future will, in turn, be willing to pay more for the NFT than they did. It's a market that depends entirely on the prospect of new money continuing to flow in.
Now, you might ask,"Isn't this just the way all markets work — prices rise because new investors come in?" But this misses a fundamental difference between things like stocks and bonds and assets like Dogecoin or NFTs. When you buy a stock, you're purchasing a share of an actual business and its future profits. Stock prices can get out of whack, of course, soaring far above the true value of a company's business.
To be clear, there is an important difference between what Bernie Madoff did and what you might call Ponzi markets. Madoff's investors, for the most part, had no idea they were part of a Ponzi scheme, while lots of the people buying these newfangled assets are, to some extent, doing it with their eyes open. They're speculators who are well aware that they're playing a game. But what isn't any different is that this game can continue only as long as people are willing to play.
, according to Nonfungible.com. And at that point the people with bad luck or bad timing, inevitably, will lose. It's like Wile E. Coyote running off a cliff. He can keep going until the moment he realizes there's no ground beneath him. When he does, he falls. And it's a long, long way down.
JamesSurowiecki Daily dogecoin was started in 2013. it was fractions of a penny until February this year. the people who started it were clever teens not career criminals. i don't think it's going anywhere.
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