Why I think Mark Turhill is wrong about no systemic risk and why it doesn't matter

Mark Turhill had this to say recently,

"There's no evidence that if that price went to zero tomorrow that there'd be any broader financial implication over time, but to me it is example of where you're getting some big price movements in the market."

I think most would agree that if Bitcoin went to zero tomorrow there is a good chance the entire crypto market would collapse. 83 Billion in market cap disappearing overnight would surely pose some sort of systemic risk. In addition to the losses of people holding cryptocurrencies the companies that are springing up and have investments would also surely vanish.

Fortunately it seems very unlikely that the scenario he talks about could even happen. Even if bitcoin were to go to zero and it caused a short term collapse in all cryptomarkets some coins would certainly recover. Steem for instance has an intrinsic value in that it drives the generation of the content on Steemit. Sure there would be less people if the rewards were lower but ultimately the content creation that happens here has been done on many social networks in the past but with much less chance of seeing a return in those other networks.

Speaking for myself Facebook has never sent me any money because someone liked one of my posts.