ETF Analyst Fires Back: Why Comparing Bitcoin to the Tulip Bubble is a Flawed Argument

Another day, another lazy comparison. Critics love dusting off the 17th-century tulip mania playbook whenever Bitcoin's price makes a move. But one ETF analyst just called their bluff.

The Core Disconnect

The argument collapses under the slightest scrutiny. Tulips were a fleeting decorative novelty with zero underlying utility beyond their beauty—and eventual decay. Bitcoin? It's a decentralized, global monetary network with a fixed supply, functioning as both a settlement layer and a digital store of value. One was a bulb. The other is a protocol.

Market Maturity vs. Mania

True bubbles pop and never recover. They leave behind empty pots and financial ruin. Bitcoin's history tells a different story—a narrative of repeated cycles, each bear market floor higher than the last, building infrastructure and attracting institutional capital that wasn't there before. That's not a bubble repeating itself; it's an asset class maturing.

The Real Signal Wall Street Misses

The tulip narrative is a comfort blanket for traditional finance. It's easier to dismiss what you don't understand than to grapple with a technology that bypasses intermediaries, cuts settlement times from days to minutes, and operates outside legacy systems. Calling it a bubble lets analysts off the hook for missing the digital transformation of money itself—a classic move from the 'if my spreadsheet can't model it, it must be worthless' school of thought.

So, the next time someone reaches for that tired historical analogy, ask them what the tulip's hash rate was. The silence will be telling.

Balchunas argues that some people disapprove of Bitcoin’s existence

Regarding the tulip market condition, the senior ETF analyst stated that the tulip market experienced a substantial rise followed by a sharp decline over nearly three years. He likened this situation to getting hit in the face and knocked out.

Contrastingly, Balchunas noted that Bitcoin has recently recovered from numerous market difficulties. Some of the challenges the digital asset faced included about six to seven significant declines before attaining a new all-time high. Additionally, he noted that the cryptocurrency has been around for 17 years.

“The fact that it has endured so long alone makes it unfit for comparison with tulips. Plus, it’s still up approximately 250% over the last three years and had a 122% increase last year,” Balchunas added.

He also alleged that some individuals simply disapprove of Bitcoin’s existence and enjoy annoying those who support this cryptocurrency. According to him, there is a high likelihood that this sentiment will remain unchanged.

Meanwhile, Michael Burry, a famous American investor widely recognized for a story that drew people’s attention through the movie “The Big Short”, weighed in on the topic. He referred to BTC as “the tulip bulb of their time.”

On the other hand, Jamie Dimon, the CEO of JPMorgan Chase, described the digital asset as worse than tulip bulbs back in 2017, labeling it a fraud.

As the situation intensified, reports indicated that the Dutch tulip mania was a period of speculative frenzy in the Netherlands during the Dutch Golden Age. At this time, tulip bulbs, which originated from Turkey, became a crucial signal of wealth among wealthy Dutch merchants. 

Following this perspective, prices began to increase rapidly at the beginning of 1634. In 1636, these prices recorded their highest peak. The situation occurred when some rare tulip bulbs were sold for prices higher than houses in Amsterdam.

However, the market experienced a sudden crash in 1637, which impacted prices, leading to a decrease of more than 90% within just a few weeks. 

It is worth noting that several individuals consider the tulip mania as one of the first recorded speculative bubbles in history. They also believe that it contributed to the popular pump-and-dump chart pattern. 

Balchunas pushes back against claims that Bitcoin lacks productivity

Earlier, Balchunas argued that this year, bitcoin has only been adjusting from the extreme highs it recorded last year. According to him, even if 2025 turned out to be steady or slightly declined, the cryptocurrency is still performing at around 50% of its yearly average.

Regarding the current situation, the senior ETF analyst attempted to explain that assets such as stocks sometimes need to take a break and that people are overthinking the situation. He also raised concerns about claims circulating in the cryptocurrency market that Bitcoin is unproductive.

“Yes, both Bitcoin and tulips are assets that don’t produce anything. But gold, a Picasso painting, and rare stamps also fall into this category. Would you really compare those to tulips? Not every asset needs to create something to have value,” said the ETF analyst.

Balchunas still insisted that tulips faced a lot of excitement but later encountered a significant drop, noting that Bitcoin’s case is a different kind of thing.

Garry Krug, the head of strategy at German Bitcoin treasury company Aifinyo, agreed with Balchunas’s argument. Krug expressed his belief that bubbles cannot survive numerous ups and downs, regulatory issues, global challenges, halving events, and exchange problems, yet still attain a new all-time high.

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