'It's Just Like Tulip Mania'

Every Bitcoin critic's favorite comparison. It's been wrong for 16 years and counting.

If you have ever mentioned Bitcoin to a skeptic, you have heard the tulip comparison. "It's just like Dutch Tulip Mania in the 1630s!" This argument has been deployed at every price point from $1 to $126,000. It has a perfect record: wrong every single time.

The comparison falls apart on contact with basic facts. Tulip Mania lasted roughly three years and was confined to a single country. Bitcoin has been growing for over 16 years across every country on Earth. Tulips are a perishable flower with no utility beyond decoration. Bitcoin is a censorship-resistant digital payment network with a fixed supply of 21 million coins. One of these things can be sent across borders in minutes. The other wilts in a week.

The tulip comparison is also historically lazy. Modern scholars have shown that Tulip Mania was far smaller and less dramatic than the popular myth suggests. Most of the "wild speculation" was in futures contracts that were never settled. The actual economic damage was minimal. The entire tulip bubble involved less money than a single medium-sized crypto exchange processes in a day.

But the comparison persists because it sounds clever and requires no research. It gives the speaker a sense of historical sophistication while revealing they know nothing about either tulips or Bitcoin. It is the intellectual equivalent of a bumper sticker.

The irony is that the people who compared Bitcoin to tulips in 2013 were proven wrong by 2017. Those who said it in 2017 were proven wrong by 2021. Those who said it in 2021 were proven wrong by 2024. The comparison has a 100% failure rate over any multi-year time horizon. Every time someone says "tulips," Bitcoin holders hear a buy signal. Tulips, meanwhile, are still about $3 each.