Bubbles or multi-trillion dollar futures for Blockchain, Cryptocurrency, AI and Cannabis?

The dot-com bubble was a historic economic bubble ran from 1997 to 2001. It was a period of extreme growth in the usage and adaptation of the Internet. Between 1995 and 2000, the Nasdaq Composite stock market index rose 400%. It reached a price–earnings ratio of 200.

From March to November 2000, internet stocks dropped by 75% from their highs and $1.8 trillion in value was lost. By the end of the stock market downturn of 2002, overall stocks had lost $5 trillion in market capitalization since the peak. 48% of dot-com companies survived through 2004. On March 2, 2015, the NASDAQ closed above 5,000 for the first time since March 9, 2000. In 2017, the Nasdaq surpassed the inflation-adjusted bubble high from March 10, 2000.

Here we look at the hottest things right now. They are cryptocurrency, blockchain, artificial intelligence and cannabis (Marijuana). What are the claims for ultimate potential? Are they in the early days of very long run ups? Are they late in bubbles?

Cryptocurrency and Blockchain future domination or collapse

There are many assertions of cryptocurrency and blockchain bubbles. The bubble claims are that the current and potential values are fabrications. Cryptocurrencies will fail or Cryptocurrencies and blockchains will fail or some of it will succeed but only after a long collapse.

The total combined market cap of cryptocurrencies reached $814 billion on Jan 8, 2018 and is now at $285 billion. It has been as low as $234 billion in 2018. The total combined market cap of all cryptocurrencies was less than $15 billion at times in January 2017.

Tim Draper made the accurate prediction that Bitcoin would hit $10,000 by 2017. Tim’s idea was Bitcoin was going to be easy enough and that people would be able to start trading with it and using it as a store of value.

Eventually cryptocurrencies, like Bitcoin will be used in mainstream situations. Draper predicts Cryptocurrencies will eventually replace credit cards and you will make crypto payments by phone. Cryptocurrency will replace fiat currencies entirely.

There is about $80 trillion worth of fiat currency in the world. Cryptocurrencies will expand that market. Draper says cryptocurrencies will eventually grow to maybe $100 trillion and fiat currencies will fall from $80 trillion to $30 trillion. He thinks Bitcoin might end up with a 20% to 30% market share. Draper predicts it will take 10-15 years to reach $100 trillion. He predicts Bitcoin will be at $250,000 by 2022.

Others predict multi-trillion markets for blockchain. The case is that blockchain will be used to make finance, stock trading and the global supply chain vastly more efficient.

Marijuana – Cannabis legalization in Canada, USA and other countries

Canada has the legalization of cannabis (marijuana). There is rapid booms and busts in the market.

There was a peak of around C$31 billion in the valuation Canadian Cannabis companies.

The USA has had legalization in several states and could see nationwide legalization.

If there were broadly legal cannabis industries in the US and other larger markets could be 20 to 100 times as large as what has happened so far in Canada.

Grand View Research forecasts legal global pot sales reaching $146.4 billion by the end of 2025. Aaron Salz, the founder and CEO of Toronto-based Stoic Advisory believes the global pot market could reach $1 trillion in a decade or less.

AI derived businesses

Global business value derived from artificial intelligence (AI) will total $1.2 trillion in 2018. This is an increase of 70% from 2017, according to Gartner. AI-derived business value is forecast to reach $3.9 trillion in 2022.

PwC forecasted that global GDP will be 14% higher in 2030 as a result of AI which means an additional $15.7 trillion.

19 thoughts on “Bubbles or multi-trillion dollar futures for Blockchain, Cryptocurrency, AI and Cannabis?”

  1. Frankly the legalization of cannabis swill be an economic depression compared to the illegal cannabis market if what’s happening in California is an indication. Note, block chains will be useful but probably will not have a huge economic impact. Cryptocurrencies are a joke useless they are tied directly to a national currency by a government.

    Reply
  2. As with the internet boom, just because we can predict with fair reliability that the INDUSTRY will be huge, has little to no bearing on the prospects of each individual stock. Indeed the faster and more radically the technology and market is changing and growing, the more likely that today’s hot property will be out maneuvered, obsoleted, and disappear into bankruptcy.

    Reply
  3. Frankly the legalization of cannabis swill be an economic depression compared to the illegal cannabis market if what’s happening in California is an indication.Note block chains will be useful but probably will not have a huge economic impact. Cryptocurrencies are a joke useless they are tied directly to a national currency by a government.

    Reply
  4. As with the internet boom just because we can predict with fair reliability that the INDUSTRY will be huge has little to no bearing on the prospects of each individual stock.Indeed the faster and more radically the technology and market is changing and growing the more likely that today’s hot property will be out maneuvered obsoleted and disappear into bankruptcy.

    Reply
  5. Of course, there are already a number of mutual funds that specialize in AI and robotics. Diversification is taken care of and, with any luck, they know more about these stocks than we do. I purchased several blocks each in a number of these funds back in December. Some are up, some are down, overall it’s been a wash so far, but it has been an odd year with some particular volatility in tech stocks. I’m willing to hang on past 2022 and see how it goes.

    Reply
  6. Instead of investing in AI technology companies that are forced to compete against their peers in an endless game of one-upmanship, why not invest in companies that benefit from advances in technology? These are the ones that, by being able to do their job with less expense, will further increase their own profits. For example, instead of investing in a company that pioneers AI-based avionics packages permitting safe operation of commercial aircraft without copilots, perhaps you should invest in the airlines that install the avionics upgrade. If eliminating copilot positions helps an airline cut costs by just 1%, that alone might increase the earnings of some airlines by as much as 20%. Thanks, Peter Lynch.

    Reply
  7. Of course there are already a number of mutual funds that specialize in AI and robotics. Diversification is taken care of and with any luck they know more about these stocks than we do. I purchased several blocks each in a number of these funds back in December. Some are up some are down overall it’s been a wash so far but it has been an odd year with some particular volatility in tech stocks. I’m willing to hang on past 2022 and see how it goes.

    Reply
  8. Instead of investing in AI technology companies that are forced to compete against their peers in an endless game of one-upmanship why not invest in companies that benefit from advances in technology? These are the ones that by being able to do their job with less expense will further increase their own profits. For example instead of investing in a company that pioneers AI-based avionics packages permitting safe operation of commercial aircraft without copilots perhaps you should invest in the airlines that install the avionics upgrade. If eliminating copilot positions helps an airline cut costs by just 1{22800fc54956079738b58e74e4dcd846757aa319aad70fcf90c97a58f3119a12} that alone might increase the earnings of some airlines by as much as 20{22800fc54956079738b58e74e4dcd846757aa319aad70fcf90c97a58f3119a12}. Thanks Peter Lynch.

    Reply
  9. Personally I’d be looking at booking systems, baggage handling, and flight scheduling. That’s where a good AI could shave some serious points off the overall expenses for an airline. And it’s far less likely that the public will care if a bunch of people who break suitcases for a living get fired, while pilots still get some sympathy.

    Reply
  10. Personally I’d be looking at booking systems baggage handling and flight scheduling. That’s where a good AI could shave some serious points off the overall expenses for an airline. And it’s far less likely that the public will care if a bunch of people who break suitcases for a living get fired while pilots still get some sympathy.

    Reply
  11. I’m not sure any (sensible) person is arguing that cannabis would INCREASE the economy. Just move a chunk of it from the black market to the white market where it can be taxed and listed on the share market. There would be a reduction in wasteful effort in both law enforcement and avoiding law enforcement, but there would be an increase in wasteful effort in stuff like government compliance, meeting accounting standards, and now the work, health, safety, equal opportunity, harassment, disabilities… and all those other expensive things now apply. They might net out to no change at all.

    Reply
  12. I’m not sure any (sensible) person is arguing that cannabis would INCREASE the economy. Just move a chunk of it from the black market to the white market where it can be taxed and listed on the share market.There would be a reduction in wasteful effort in both law enforcement and avoiding law enforcement but there would be an increase in wasteful effort in stuff like government compliance meeting accounting standards and now the work health safety equal opportunity harassment disabilities… and all those other expensive things now apply. They might net out to no change at all.

    Reply
  13. They look like technologies that China and America will contend to dominate–much to the benefit of everyone, we hope.

    China, as usual, has jumped into all of them with both feet and full pockets and you can see how high up the food chain their enthusiasm goes from these headlines:

    1. Bank of China Moves to Patent Blockchain Scaling Solution – CoinDesk
    https://www.coindesk.com/bank-of-china-thinks-it-has-a-solution-to-the-blockchain-s
    Feb 23, 2018 – As reported by CoinDesk last year, Bank of China has already partnered with

    2. The Agricultural Bank of China (ABC), the world’s fourth-largest bank by assets, has issued its first loan on blockchain, local news outlet …

    3. People’s Bank of China Files Patent for Digital Currency Wallet
    https://cointelegraph.com/…/people-s-bank-of-china-files-patent-for-digital-currency-…
    Jun 26, 2018 – This week’s new patent is a part of a longer-term vision for blockchain integration pursued by China’s central bank. While the government …

    4. China: World’s Third-Largest Bank Issues Farmland Mortgage … – CCN
    https://www.ccn.com/china-worlds-third-largest-bank-issues-farmland-mortgage-loan-
    2 days ago – The Agricultural Bank of China (ABC) today announced that it has issued a farmland loan worth $300000 on the blockchain.

    5. People’s Bank of China (PBoC) Has Filed 41 Blockchain-Related …
    https://www.coinspeaker.com/…/peoples-bank-of-china-pboc-has-filed-41-blockchain…
    Jun 27, 2018 – China is continuing its way of crypto development. A digital currency research lab set up by the People’s Bank of China has submitted 41 patent …
    Bank of China embracing blockchain use in Hong Kong | South China …
    https://www.scmp.com › Business › Banking & Finance

    6. Apr 23, 2018 – Bank of China Hong Kong (BOCHK) now handles almost all its real estate appraisals via blockchain, as part of a concerted push into financial …

    Reply
  14. I’m not sure any (sensible) person is arguing that cannabis would INCREASE the economy. Just move a chunk of it from the black market to the white market where it can be taxed and listed on the share market.
    There would be a reduction in wasteful effort in both law enforcement and avoiding law enforcement, but there would be an increase in wasteful effort in stuff like government compliance, meeting accounting standards, and now the work, health, safety, equal opportunity, harassment, disabilities… and all those other expensive things now apply. They might net out to no change at all.

    Reply
  15. Personally I’d be looking at booking systems, baggage handling, and flight scheduling. That’s where a good AI could shave some serious points off the overall expenses for an airline. And it’s far less likely that the public will care if a bunch of people who break suitcases for a living get fired, while pilots still get some sympathy.

    Reply
  16. Of course, there are already a number of mutual funds that specialize in AI and robotics. Diversification is taken care of and, with any luck, they know more about these stocks than we do. I purchased several blocks each in a number of these funds back in December. Some are up, some are down, overall it’s been a wash so far, but it has been an odd year with some particular volatility in tech stocks. I’m willing to hang on past 2022 and see how it goes.

    Reply
  17. Instead of investing in AI technology companies that are forced to compete against their peers in an endless game of one-upmanship, why not invest in companies that benefit from advances in technology? These are the ones that, by being able to do their job with less expense, will further increase their own profits.

    For example, instead of investing in a company that pioneers AI-based avionics packages permitting safe operation of commercial aircraft without copilots, perhaps you should invest in the airlines that install the avionics upgrade. If eliminating copilot positions helps an airline cut costs by just 1%, that alone might increase the earnings of some airlines by as much as 20%.

    Thanks, Peter Lynch.

    Reply
  18. Frankly the legalization of cannabis swill be an economic depression compared to the illegal cannabis market if what’s happening in California is an indication.

    Note, block chains will be useful but probably will not have a huge economic impact. Cryptocurrencies are a joke useless they are tied directly to a national currency by a government.

    Reply
  19. As with the internet boom, just because we can predict with fair reliability that the INDUSTRY will be huge, has little to no bearing on the prospects of each individual stock.
    Indeed the faster and more radically the technology and market is changing and growing, the more likely that today’s hot property will be out maneuvered, obsoleted, and disappear into bankruptcy.

    Reply

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