It had to happen sooner or later. Digital bitcoin colorado have been on a rocket ride in 2017.
Other cryptocurrencies were carried along by the craze. The thing is, it’s always been hard to identify a “there” there. Digital cryptocurrencies like bitcoin aren’t very good mediums of exchange or stores of value. Nothing seems to be fueling the price rise other than, well, excitement over the price rise. Eventually, the whole thing was going to descend into outright self-parody. And last week seemed to be the tipping point. Thursday — and its stock promptly shot up by 200 percent.
Now, the blockchain software technology that underlies bitcoin actually does have some potential real-world uses. So a company getting into blockchain development might actually turn out to be a good long-term bet. Except, as you may have noticed, this is a bloody iced tea company. Their expertise and institutional knowhow is in peach and lemon flavoring. They have no actual infrastructure in place to deal with the cryptocurrency business: The company is having “preliminary” discussions about buying a developer that specializes in blockchain, and another firm that offers cryptocurrency technology services, and that’s it. Other examples were even more egregious. A pharmaceutical company named Bioptix announced in October that it was getting into the cryptocurrency business by setting up a currency exchange and a bitcoin operation.
Which obviously depends entirely on the value of said currencies remaining high. Bioptix changed its name to Riot Blockchain Inc. It fell back afterwards, but still remains over twice as high as its October value. A firm that specializes in batteries and flavored liquids for electronic cigarettes rebranded itself from “Vapetek Inc. A British company called On-Line PLC that works to shepherd online startups changed its name to “On-Line Blockchain PLC” and said it was going to “provide systems to support the roll out of across a range of applications. Both promptly saw their stock prices boom. Any mania like this, over an asset whose underlying use value is so mercurial and hard to pin down, inevitably opens investors up to the danger they’ll either get burned or fleeced.
But at this point, all a company has to do is put “blockchain” or “crypto” or whatever in its name, and a whole bunch of investors will immediately shout “take my money! Appropriately enough, just as the whole episode was reaching its iced-tea-companies-providing-blockchain-services zenith, the bottom dropped out. It began a very slow descent after that, but nothing dramatic. The bust last week was bad enough to temporarily disable buying and selling on Coinbase, one of the biggest bitcoin trading markets in America. Moreover, a boatload of other digital currencies also crashed in the exact same time period, either by the same amount as bitcoin or by much more. 440 billion in a single day. Now, this wouldn’t be the first time bitcoin has gone through a rollercoaster ride: In September, it fell 40 percent at one point before recovering.