The problem with this hypothesis is that step 9 kept having a higher and higher Bitcoin market cap, until it hit a ~$300 billion in January (and cryptocoins in general hit $800 billion market cap). It is like subprime mortgages or dot-bomb stocks or tulip bulbs or what have you, at some point it becomes significantly large enough for people like Charlie Munger to have to contemplate it and deem Bitcoin "rat poison". Then its $300 billion market cap falls to $80 billion, which is its current market cap. IMHO, Bitcoin's market cap will be near $0 eventually, as it is worthless. So there is still air to deflate that balloon. Unless investors want to pour $220 billion back into Bitcoin to reinflate it.
