[PragmaticPulp]

> So many people have learned nothing.

The more I talk to crypto/NFT people, the more I’ve realized that they’re looking at the same historical events but walking away with completely different take-aways.

For example, they wouldn’t look at the Beanie Baby bubble and think of the people who invested a lot of money and had nothing to show for it after the crash. They’d look at the price charts of Beanie Babies and pattern-match that to NFTs with an assumption that they’re early in the game. Just sell before the line goes down and they’re going to be rich!

[ska]

> Just sell before the line goes down and they’re going to be rich!

This is generally known as the greater fool theory.

[Lerc]

In many respects they are right. Frequently there _are_ greater fools. Eventually someone is left holding the can. The Art world works because there are a few extremely wealthy people who are content to be the 'fool' at the end of the chain. In those cases sentimental attachment or simply being a patron of the arts is enough for them. If everyone expects to make a gain, it's a house of cards.

Cryptocurrencies are a bit different. While there is the same line-goes-up, line-goes-down hunt for greater fools going on, beneath that are people gauging the actual worth. Bitcoin and ETH are vastly overvalued base upon current utility, but if they came to replace money/gold/other they could be worth many times their current value. Investors buying and selling on that basis are not looking for greater fools but are attempting to be more right about the future than average.

[ska]

> Frequently there _are_ greater fools.

That's the basic point of the theory! The tricky part is, at least on mass, humans are much worse at knowing where they are in the curve than they think they are...