How history explains bitcoin, Mt. Gox bankruptcy - Chuck Jaffe - MarketWatch: "Oh, in practice that’s not right. The prices for all cryptocurrencies went tumbling this week with the evaporation of Mt. Gox; the largest bitcoin exchange vanished amid swirling troubles, acknowledging bitcoin losses of roughly $475 million, then resurfaced to declare bankruptcy in a Tokyo court."
Because tulips had potential profit built in—each bulb could be the progenitor for future generations of flowers and additional bulbs—the price obviously got to where it had no basis in reality; when Dutch government officials stepped in to calm the market—believing the wild speculation could hurt the entire economy—tulip merchants decided they needed to protect their profits, starting a selling frenzy.
In a matter of days, the tulip market was pretty much gone.
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