The stocks of Internet companies unnaturally increased in price, many business giants also began to focus on Internet business, all this noise was supported by various analysts and economists, trumpeting everywhere that a new era of business had come
In fact, these business models turned out to be ineffective, loan funds, which were mainly spent on marketing and dishonest entrepreneurs, contributed to the collapse of an overly bloated market
The reason was a lack of understanding of the principle of using the Internet in business, in fact the Internet can be a useful tool for increasing business efficiency, but as an independent business process capable of generating income from invested funds, it was insolvent and the market has not yet been formed.
Let's look at stock price charts for some companies that were hit hard during the dot-com boom.
S&P - a company engaged in analytical research of financial markets, one of the three most influential rating agencies in the world
As we can see on the chart, from the beginning of the dot-com boom, S&P shares fell from $ 1,520 to $ 800, 2 years of stable decline, several months of stagnation, and only after that growth began
Nasdaq - American Exchange. which specializes in stocks of HI-Tek companies, one of the three major US stock exchanges
Nasdaq got even more, we again see a steady decline over 2 years, here the stock fell in price from $ 4,800 to $ 800, a 6-fold fall
Despite this collapse and the fact that many companies were closed then - these giants still exist and feel pretty good, they have not reached the same bottom as after this fall, after that a gradual growth has been observed for 18 years now (compared to the lowest point)
With the cryptocurrency market, we could see a similar situation. The new technology - the widespread noise about the new era, the artificially inflating the market, the blockchain are trying to push everywhere where it is needed and where not really.
The artificially inflated market apparently burst, the crypt collapsed.
Without that, speculators drove the unnatural bitcoin rate, the ether created a platform for tokens, giving life to various projects (including scam), each of which conducted an ICO, and when these fees stopped making money, and the owners of the companies began to abruptly go from the air to fiat - the course quickly flew down
Continuing the parallels with dotcoms, entrepreneurs learned how to do business on the Internet without benefit by inflating the market, at the moment there is probably not a single major player without a website and a page in social networks, the market has normalized and has begun to bring benefits.
Drop from $ 20,000 to $ 3,000 6.5 times compared to peak rate
Despite the similarity of the situation, Bitcoin emerged from a constant fall within a year, after which there is a gradual increase compared to the lowest rate
It's no secret that in the world of cryptocurrencies, everything happens a little faster than in the classic stock market
We can see that after the dot-com boom, the stock price of large companies never again fell to the extreme point of 2002.
From here we can make an assumption that we will no longer see the fall of bitcoin to $ 3,000
We are witnessing the formation of the market and the real use of the blockchain for the benefit of the end user. Examples of such projects - TON, LIBRA
The upcoming halving on May 22 of Bitcoin should positively affect the course, as it had already influenced twice before.
Considering all the similarities found between these two situations, we can assume that in the near future we will see the growth of crypto and the introduction of blockchain in many business processes.