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People will believe it because they've seen it go up thousands of percent in a decade, shaking off massive downturns to go even higher. That alone makes it look bullet proof even though its not. Whats going to burst the bubble? Government action to ban or curtail it use. At that point it illiquid nature and lack of intrinsic worth will become apparent.



> they've seen it go up thousands of percent in a decade

True, and the relevant aphorism are:

"If something cannot go on forever, it will stop" and "the markets can remain irrational longer than you can remain solvent".

A problem seems to be the lack of legitimate investments with decent rates of return at present. So people turn to more speculative assets.




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