If digital assets cannot be bracketed as assets with value or currency, the big question is what’s the sustainable framework for India’s policy?
Scottish journalist Charles Mackay in his epic book, “extraordinary popular delusions and the madness of crowds” captured the financial mess induced by Tulipmania that gripped Dutch Republic during 1634-37.
In the book that gained popular attention in 1841, Mackay elaborates as to how one tulip bulb turned more expensive than five hectares (12 acres) land at one point of time. This frenzied financial speculation in Dutch Republic aptly explained Tulipmania as part of markets history globally.
Prices of tulips suddenly collapsed in February 1637 after the asset bubble burst thereby investors losing millions in dollars. At the height of tulip mania, as several documented works point to, one bulb cost ten times more than the annual income of a skilled artisan in Dutch Republic.
This is the story that played in the backdrop when RBI governor Shakti Kanta Das recently said that crypto currencies did not have values like tulips in Dutch Republic of yester years. He also drew comparisons to unscientific or speculative values attributed to crypto currencies like tulips. Shakti Kanta Das refreshed financial markets, key stakeholders and investors with how Dutch Republic’s vibrant markets went down under following tulip bubble burst in two years of speculative trading that had no logic, reasoning or…
