Bitcoins - tulip mania?

The later part of the 20th century saw its fair share of financial bubbles. There was the property bubble, stock market bubbles, and then the dot com bubble of 2000, just to name a few. In each instance, people paid exorbitant amounts for things that shouldn’t have been worth anything like the going price. But this is nothing new – look back at the Dutch in the 17th century when already pricey tulip bulbs experienced a twentyfold price explosion in just a single month.

By the peak of tulipmania in February 1637, a single tulip bulb was worth about ten times a craftsman’s annual income and a single Viceroy tulip bulb was allegedly exchanged for eight fat swine, twelve fat sheep or four tuns of beer.

The Bitcoin

So nearly 400 years later, have lessons been learned from the Dutch experiences of ‘euphoria investing’ ? This leads to the topic of Crypto currencies which goes back to only 2008 thanks to Satoshi Nakamoto who launched the first peer to peer digital cash system. The whole topic of what bitcoins really are, how you buy them, store them and sell them is far too complex to explain here. Regardless of what they really are and what you can do with them almost becomes irrelevant when you consider the ecstatic increase in value since 2008 or even the last month !

To illustrate this, the below table shows some highlights of price fluctuations over the seven years. Had you held $100 worth of bitcoins like lucky Laszlo Hanyecz in May 2010, that same amount of bitcoins would be worth no less than $56million today.  Even a single $1 investment would be worth a staggering $560,000 only seven years later.


Bitcoin value history (comparison to US$)




May 2010

< $0.01

On 22 May 2010,Laszlo Hanyecz made the first real-world transaction by buying two pizzas in Florida for 10,000 BTC

July 2010


In five days, the price grew 1000%, rising from $0.008 to $0.08 for 1 bitcoin.

July 2011


top of first "bubble", followed by the first price drop

Nov 2013

$350 — $1,242


Dec 2013

$600 — $1,000

Price crashed to $600, rebounded to $1,000, crashed again to the $500 range. Stabilized to the  $650–$800 range.

Apr 2014

$340 — $530

The lowest price since the 2012-2013 Cypriot financial crisis.

September 2016

$600 — $630

Price stabilized in the low $600 range.

March 2017


Price broke above the November 2013 high of $1,242 and then traded above $1,290.

September 2017


Price reached $5,000 for the first time on 1 September 2017.

September 2017


11 days later, the price dipped harshly from China's bitcoin ICO and exchange crackdown.

October 2017


Price shot back up as the world moves on past the incident following China's crackdown and reaches its maximum in the history of bitcoin.


Without doubt, the Crypto currency revolution has caught the eye of many of us. But would you buy today at $5,600 when seven years ago the price was less than $0.01? According to Peter Smith, CEO and co-founder of Blockchain, the price could soar to $500,000 by 2030. Many others predict this is just another financial bubble of catastrophic proportions. Either way, the topic is fascinating.

This article is not intending to give advice and is for information purposes only. The trading in any cryptocurrency is extremely high risk and should only be considered with money you are prepared to lose. 

Back to Top