Another day, another new high in bitcoin. Oh, my goodness me. When and where is it going to end? Cryptocurrencies are the new dotcom The price of a bitcoin is $4,250 as I write this. It'll probably be $5,000 by the time you read it. The comment is not quite as flippant as it sounds. Bitcoin rose 20% over the weekend while all other markets were closed. Why shouldn't it rise by a similar amount on a Tuesday or Wednesday? It's a tech. The tech is now established. More and more potential uses are being found for it. More and more investment is piling into it. More and more interest is being generated. And it's not confined to the West. It's very hot in South Korea, for example. Thus, as it has global interest, you can go to sleep and wake up in the morning to find it 20% higher. It's actually easier for an Asian to buy bitcoins than US stocks.

Before our eyes we see the incredible wealth creation that is a result of limiting the supply of a currency especially one that everybody wants. At the end of June, with bitcoin at $2,500, I wrote a piece explaining how to buy bitcoin. However, I urged some caution as I felt, price-wise, things were getting a little ahead of themselves. How sage I seemed. Within just a couple of three weeks the price had fallen 30% to $1,800. What has happened since has blown the eyeballs out of everyone. The price has turned around and rallied some 150%. Crypto is the new dotcom, folks. Everyday there is some piece of news about some new hedge fund that is getting into crypto. And who can blame them? They've had a rotten time of it, by their standards, in recent years. Why try for 15% annual returns in the stockmarket, when crypto gives you 150% in under a month? The number of cryptocurrencies out there is exploding. What was a million-dollar market, became a billion-dollar market that is now a $126bn market. It will soon be a trillion-dollar market. Bitcoin alone now has a market cap bigger than PayPal. Every other day there is some new ICO (initial coin offering) that raises some double-digit, million dollar sum in a matter of minutes. Some of these technologies may actually go on and do something. Most are the technological equivalent of sending some dodgy mining prospector wandering out into the bush with a donkey and a shovel while the financiers rub their hands together at the $20m that just got deposited in Panama.

So where does it all end? Nobody knows the answer to that, of course. It's a speculative bubble. It could pop tomorrow or in five years' time. But here's why it has the potential to go on and on. Fear of missing out is set to trump fear of losing money The first thing I'd say, on an individual level, is that there are still so many people who are not in on the game. Every day I get some kind of message from somebody kicking themselves about how they've known about bitcoin for years, but for one reason or another cynicism, laziness, too busy, lack of belief, didn't think it would go this high, not wanting to buy in after it has already run so far did not get in. Equally there are swatches of early adopters who doubled, tripled, quadrupled or even made a hundred times their investment and sold and thus sold too early. Then there's the larger majority who are only just learning about it now. Then there's the institutional money. Those who manage that money will be in the same boat as the rest of us missed out, sold too early or are new to it. I was involved in an Aim start up called CoinWorks a couple of years ago. It never got off the ground because we couldn't raise the required £3m or whatever it was we needed to get the thing listed. I remember giving talks saying crypto was going to be bigger than dotcom and that we would be getting in right at the beginning of the hype cycle. Investors, from private to institutional, nodded wisely in agreement and then didn't put their hands in their pockets.£3m! It seems like nothing now. I dread to think what an Aim-listed crypto investment fund would be worth today. If only.

I got hacked many years ago and had some bitcoins stolen. It angered me at the time but more because they'd got into my email account than for the value of the actual coins (I think I had 13 nicked). I even have the email address and the IP address, which I traced to some offices in Soho, of all places, of the person who hacked me. The police weren't interested. The actual value of the bitcoins wasn't that high, so I let it go. It would be over fifty grand now! There are so many stories like this of people missing out in some way. I'm sure you reading this are undergoing a similar rush of misery as you look back at the last five years and think: "Ten grand and I'd now be on Britain's billionaires list". That's the point there is still a huge amount of money on the side lines, the world over, that wants in on the game. The top of this market could be a long way off Where's the top? Forget any standard valuation measures. Forget traditional volatility or momentum measures. They won't work. Even shoeshine-boy indicators won't work because crypto has been created by shoeshine boys and outsiders. Indeed, who are bitcoin's shoeshiners? Not kids, for sure. If anything, it's the technophobic older generation. Perhaps we have to enter the non-scientific realms of instinct and educated guesswork. The fact that every spam email or ad in my inbox, every ad I read on a website, seems to be telling me how to get into crypto is a major warning sign.