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Bitcoin has tiptoed back above $10,000, from $4,000 a year ago, and I have two questions. The first is why it isn’t yet hitting new highs above $20,000. The second is why it isn’t worth zero.

Last spring, I wrote that conditions are perfect for a flight to nonsense, with growth scarce and the Federal Reserve again cutting interest rates, and that Bitcoin would be the bellwether. U.S. stock indexes have shot higher since then, which I wouldn’t call a bubble or meltup just yet. The market is expensive relative to revenues, but reasonable compared with free cash flow, especially to investors who expect interest rates to remain low for longer.

There are signs of excess, however. Virgin Galactic Holdings (ticker: SPCE) has doubled in price, to $26, since October. That means the space-travel start-up is worth $5 billion, or about 1,000 times revenue.

Tesla stock (TSLA) has jumped 260% in six months, driving the company this past week to propose another stock offering, right after founder Elon Musk said such a move wouldn’t make sense. Junk-bond yields, meanwhile, are at historic lows.

And the filling-to-wafer ratio of sandwich cookies is at record levels, thanks to a new offering from Oreo called The Most Stuf. I’m not saying that’s part of the same trend, but I’m not ruling it out, either.

The other thing that ought to be sending Bitcoin bonkers is that “mining” new coins using computing power is about to become half as rewarding. That automatically happens every four years or so. Some Bitcoin watchers call it the halving, and some call it the halvening. I like the second one because it sounds a little more Dungeons & Dragons, and I suspect that cryptocurrencies are really an elaborate role-playing game, with metrics like “hash rate” and “attack cost” taking the place of dice, hit points, and wizard spells.

In the past, halvenings have come with new highenings. I first wrote about Bitcoin in 2011 for SmartMoney.com (which was absorbed into MarketWatch during a later media halvening). The price was $10.50 at the time, which might not sound like much, but that was up from half a penny in a year, making Bitcoin the world’s top-gaining currency by far. There was a halvening in 2012, and by late 2013, Bitcoin hit $400.

The next halvening came in 2016, and was followed by a price gain of more than 2,000% over 18 months, with Bitcoin peaking at just under $20,000 near the end of 2017.

We’re due for another halvening around May. Assuming cryptocurrency traders are forward-looking, backward-testing go-getters, why hasn’t Bitcoin gone full Tesla?

Maybe it’s the competition. Ethereum and other cryptocurrencies have been gaining faster than Bitcoin this year. Or maybe it’s just early. Tom Lee, head of research at Fundstrat Global Advisors, which sells Bitcoin analysis to money managers, says he expects Bitcoin to outperform the S&P 500 index for the rest of the year and to hit $40,000 before the Dow Jones Industrial Average hits 40,000 points. In other words, Bitcoin will gain about 285% before the Dow rises 35%.

That’s the bull case. The bear case comes from Minneapolis Federal Reserve president and total Bitcoin buzz kill Neel Kashkari. Speaking at an event in Montana this past week, he was asked whether a Treasury bond or Bitcoin would make a better gift, and he picked the T-bond.

“Maybe five years from now or 10 years from now or 20 years from now something useful will emerge from this, but so far, all that’s emerging is burning garbage,” Kashkari said of cryptocurrencies.

I’m not sure what the appropriate allocation to burning garbage is for a prudent investor. I predict the whole thing will end in tears, but I’ll hedge by not specifying whether the tears will come from joy, anguish, or allergies.

Put me on record for Oreos, however. Creme ratios will crash from Most Stuf straight through support levels at Mega Stuf, before finding a bid at Double Stuf.

Write to Jack Hough at jack.hough@barrons.com