Written by: thiigth

Mark Twain once said, "History does not repeat itself, but it often rhymes." The internet bubble (1995-2002) and the recent cryptocurrency boom (2017-2025) seem like two rhyming poems—after a wild celebration, they both fell into a trough, only to eventually be reborn. This article will compare the journeys of Ethereum (ETH) and Amazon (AMZN), taking you through these two financial roller coasters and summarizing the key lessons we can learn from them.

1. The Internet Bubble Era: Revelry, Crash, and Amazon's Comeback Amid High Rates

1.1 The Party (1995-2000): Irrational Prosperity Amid High Rates

The internet industry in the late 90s was like a newly debuted rock star, with everyone believing it could change the world. Venture capitalists poured money into various ".com" newcomers, from Pets.com to Webvan, with entrepreneurs chanting, "Capture the market first."

The Nasdaq index soared by 86% in 1999, rising from under 1000 points in 1995 to over 5000 points by March 2000. For example, Amazon went public in 1997 (IPO priced at $18), and after several stock splits, its price peaked at the end of 1999 (around $113), reaching a market capitalization of over $20 billion (in 2000 dollars).

Despite the Federal Reserve maintaining the benchmark interest rate between 5.5% and 6% from late 1994 to 1995, investors continued their reckless ways. Why did the internet bubble persist in such a high-rate environment? The reason lies in the illusion of the "new economy." Investors firmly believed that the internet would ultimately reshape the economy, thus ignoring the high borrowing costs. Additionally, the 1997 U.S. "Taxpayer Relief Act" reduced capital gains taxes, igniting a wave of venture capital that flooded into the tech sector—leading to soaring Nasdaq prices and abundant financing channels.

1.2 The Crash (2000-2002): Rate Hikes Burst the Bubble

By March 2000, the party abruptly ended. To curb inflation, the Federal Reserve began a series of rate hikes starting in 1999, raising the federal funds rate to 6.5% by May 2000. The high borrowing costs acted like a tightening noose, instantly choking off the lifeblood of unprofitable ".com" companies, leading to rapid cash depletion and the collapse of many cash-burning businesses (like the online supermarket Webvan). External shocks followed, with Japan entering a recession in March 2000, and then the "9/11" terrorist attacks in September 2001 causing a significant drop in the New York stock market (the NYSE fell over 14% on its first day of reopening). The Nasdaq index plummeted from its peak of 5048 points to 1139 points by October 2002, a staggering decline of 76.81%, evaporating about $5 trillion in market value.

At that time, Amazon could not escape misfortune either: its stock price fell from its peak to just $5.51 in October 2001 (a cumulative drop of 95%), with a market cap shrinking to $2.5 billion and debts nearing $2.1 billion, leading public opinion to declare that "Amazon is done for."

1.3 Value Rebirth (2003 and Beyond): Low Rates Fuel the Comeback

After the trough in 2003, Amazon finally saw a turnaround: the company achieved a net profit of $35 million that year, with revenues reaching $5.27 billion (its first profitable year).

In 2005, Amazon launched Prime membership (a two-day delivery service for an annual fee of $79), and in 2006, it introduced cloud services AWS, transforming from a mere book retailer into a "retail + cloud computing" giant. Following these innovations, Amazon continued to expand, and by July 2025, its market cap had reached approximately $2.34 trillion (an 8858% increase from its 2003 market cap).

The secret to its success lies in its solid business fundamentals: maintaining healthy cash flow through physical goods sales and a "pay after delivery" cash cycle, while continuously innovating and expanding product categories. The support of a low-rate environment was also crucial—by 2003, the Fed had lowered rates to below 1%, creating a favorable environment for consumption and investment. Amazon took advantage of this window to build a logistics network and develop new businesses on a large scale.

2. The Cryptocurrency Bubble Era: Low Rates Take Off, Rate Hikes Burst

2.1 The Party (2017-2021): Frenzy Amid Zero Rates

The cryptocurrency market can be seen as a "digital remake" of the internet bubble. In 2017, Bitcoin skyrocketed from around $1,000 at the beginning of the year to $20,000 by the end; ICOs (Initial Coin Offerings) became a global craze. Following that, from 2020 to 2021, concepts like NFTs, DeFi, and meme coins swept the market. Bitcoin reached an all-time high of nearly $69,000 in November 2021, while Ethereum also surged to around $4,800, with the entire crypto market cap briefly surpassing $3 trillion.

This frenzy was driven by the Federal Reserve's ultra-low interest rates and quantitative easing policies: from 2020 to 2021, the federal funds rate remained at 0%-0.25%, and the Fed's balance sheet approached $9 trillion. Cheap capital led both retail and institutional investors to pour money into crypto assets, causing trading volumes on exchanges and activity on DeFi platforms to soar. It can be said that the zero-rate era provided the "ammunition" for crypto assets, inflating this bubble even more than the internet bubble of the 1990s.

Unlike internet companies, the crypto market is deeply reliant on leverage and retail-driven speculation. The influx of speculative stories and "retail investors" became the main characters.

2.2 The Crash (2022): Rate Hikes Break the Spell

In 2022, the situation took a sharp turn. To curb soaring inflation, the Federal Reserve began a series of rate hikes starting in March 2022, raising rates 11 times by July 2023, with the federal funds rate target range climbing from 0%-0.25% to 5%-5.25% (the fastest rate hike pace in half a century).

The steep increase in borrowing costs made it difficult for the highly leveraged crypto market to sustain itself. Bitcoin's price plummeted from its peak to around $16,000 (a drop of about 76%), while Ethereum fell from around $4,800 to about $900 (an 80% drop), with the crypto market cap evaporating by nearly $2 trillion at one point. Meanwhile, projects backed by stablecoin narratives and high leverage collapsed: the TerraUST stablecoin and Luna crash caused losses of about $42 billion, the lending platform Celsius faced over $1.2 billion in losses, and hedge fund 3AC went bankrupt… the entire market seemed to experience a "snow avalanche."

This crash triggered a severe crisis of trust. More and more investors became skeptical of digital assets, with reports indicating that nearly half of Americans stated they would "never buy digital currencies again." Participants in crypto assets flocked to off-market safe havens, and market sentiment grew as cold as during the internet winter of 2002.

2.3 Recovery and Rebirth (2023-2025): Rate Cuts and Policy Support

Ethereum survived thanks to its vast ecological advantages: as of 2022, there were thousands of active DApps and developer teams on Ethereum, and its community consensus remained relatively stable. Additionally, Ethereum completed the highly publicized "Merge" upgrade in September of that year, transitioning from proof-of-work to proof-of-stake consensus, reducing energy consumption by about 99.95%. More importantly, Ethereum vigorously developed Layer-2 scaling solutions (such as Arbitrum, Optimism, etc.) to improve transaction throughput and reduce fees.

Entering 2023, the crypto market began to attempt a recovery. By July 2025, Ethereum's price had rebounded to around $2,565, the total locked value in DeFi returned to the hundreds of billions level, and the NFT market gradually warmed up. Layer-2 projects like Arbitrum saw their TVL increase to billions of dollars, significantly enhancing Ethereum's usability and user experience (these advancements are akin to Amazon's launch of AWS upgrading its business model).

On the other hand, changes in regulation and policy also injected confidence into the market: in July 2024, the U.S. Securities and Exchange Commission finally approved multiple Ethereum spot ETFs, similar to the Federal Reserve's "firefighting" during the low-rate era of 2003, bringing institutional capital and legitimate compliance channels to digital assets.

Changes in monetary policy were also crucial. In the second half of 2024, the Federal Reserve cut rates for the first time, lowering the rate from 5.25% to 4.75%-5% (somewhat similar to the low-rate environment of 2003), with further rate cuts expected in 2025. These changes provided more room for risk assets to imagine.

Overall, Ethereum's recovery is based on several key factors: the DApp ecosystem (thousands of applications and active users), technological innovation (Layer-2 and the Merge upgrade), and favorable regulation (ETF listings), paralleling how Amazon relied on Prime, AWS, and a low-rate environment to support its growth after the internet bubble. Between 2023 and 2025, while Ethereum's price remains far below its historical peak, it has shown resilience and upward potential—just as predictions from CoinGape and others suggest that by 2030, Ethereum may truly explode, potentially reaching new highs akin to those of Amazon in its heyday (current market expectations indicate that Ethereum's trajectory in 2025 still carries significant uncertainty).

3. Federal Reserve Rates: The Rhymes of High vs. Low Starting Points

The Federal Reserve's interest rate policy acts like the "DJ" of these two parties, determining the rhythm of revelry or calm:

Internet Bubble (1995–2002): High starting point (federal funds rate around 5.5%-6.5%), with rapid economic growth in the 1990s prompting the Fed to adopt a high-rate strategy to prevent inflation. However, the market was infected by the enthusiasm for the "new economy" and tax reforms, leading to rampant speculation. It wasn't until 2000, when the Fed raised rates six times to 6.5%, that the bubble burst. After 2001, the Fed quickly cut rates 11 times to below 1.75% (maintaining around 1% in 2003), leading to a significant loosening of market funds, aiding the recovery of tech companies like Amazon.

Crypto Bubble (2017–2025): Low starting point (interest rates were nearly 0% post-pandemic in 2020-21), with the Federal Reserve's massive quantitative easing flooding the market with risk capital, causing the bubble to inflate even more rapidly (the Fed's asset scale soared to nearly $9 trillion). Starting in 2022, the Fed's 11 rate hikes pushed rates up to 5-5.25%, and the crypto market, which had taken off from 0%, was abruptly "doused with cold water" by reality, leading to a severe crash. Now, as the Fed begins to gradually cut rates in 2024-25 (down to 4.75%-5% in 2024), this is a positive sign for crypto assets, but future risks still exist.

The differences in the starting points and the speed of changes in interest rates determined the fates of the two bubbles: the 90s internet bubble drifted away under high rates, while low rates supported its recovery; the crypto bubble soared madly under zero rates, only to be yanked back to reality by rapid rate hikes. In summary: high rates crush speculation, while low rates inflate bubbles—this historical rhyme has been vividly illustrated in both waves.

4. Amazon and Ethereum: The Rhyming Path to Comeback

Amazon and Ethereum, these two "protagonists," have undergone remarkably similar journeys:

Celebration Period: Amazon experienced frenzied expansion from 1997 to 2000, with a market cap exceeding $20 billion; Ethereum saw a surge of ICOs and DeFi projects from 2017 to 2021, with its market cap approaching $500 billion (the global crypto market peaked at $3 trillion, with Ethereum holding a significant share).

Crash Period: From 2000 to 2002, the internet bubble burst, with the Nasdaq plummeting over 76%, and Amazon's stock price dropping 95%, seemingly on the verge of collapse. However, Amazon survived by relying on physical goods sales and a solid cash flow (negative cash cycle), slowly recovering after timely debt restructuring. Similarly, in 2022, digital currencies fell over 80%, with Bitcoin dropping to $16,000. Ethereum also experienced a significant decline, but thanks to its robust DApp ecosystem and community support, along with drastically reduced energy consumption after transitioning to PoS, it successfully weathered the winter.

Rebirth Period: Amazon turned a profit for the first time in 2003 and used this to expand; it launched Prime in 2005 and AWS in 2006—transforming from an online bookstore into a comprehensive retail and cloud computing giant, reaching a market cap of $2.34 trillion by 2025. Ethereum began to see price recovery in 2023 and welcomed favorable developments like the listing of spot ETFs in 2024, with its ecosystem continuing to expand; although it is still in deep consolidation today, the market anticipates its true takeoff may occur in the coming years.

Common Lessons: Whether it’s a tech giant or a blockchain platform, long-term value comes from solid fundamentals, technological innovation, and a user base, rather than fleeting speculative enthusiasm; the interest rate environment sets the overall rhythm: high-rate phases eliminate the weak, while low-rate phases provide opportunities for the strong.

5. What Can We Learn?

While history does not repeat itself, the rhyming lessons are still worth heeding. The following points can help us navigate the crypto market in 2025 with fewer detours and invest more prudently:

Fundamentals Matter: Amazon survived the internet winter because it maintained stable cash flow through physical sales and a "pay after delivery" model; Ethereum endured the crypto winter thanks to the value created by thousands of DApps and users on its network. When investing in digital currencies, prioritize projects with real applications and community support. For instance, Ethereum (ETH) suffered less during the recent turmoil due to its rich ecosystem, while high-performance public chains like Solana (SOL) have also garnered attention due to their user base and unique features. Avoid chasing "story coins" without real-world applications, as they may end up like Pets.com in 2000, leaving only an empty shell.

Technological Innovation is Key: Amazon's AWS cloud service and Prime membership were crucial upgrades to its business model; similarly, Ethereum's Layer-2 scaling and other protocol upgrades (like the recent Pectra upgrade) are critical for its revival. Investors should focus on which crypto projects have a technological edge: for example, Layer-2 solutions (Arbitrum, ZK-Rollup, etc.) significantly enhance Ethereum's network throughput. Future attention can be directed towards cutting-edge projects in areas like on-chain AI and DePIN (Decentralized Physical Infrastructure Networks), allocating a small portion of the portfolio to high-potential emerging projects to avoid missing the next wave of innovation.

User Base is a Moat: Amazon has hundreds of millions of Prime members, providing continuous consumer support even during crises; Ethereum boasts tens of millions of active addresses and developers, creating a strong network effect. When selecting investment targets, prioritize projects with community and user support. In contrast, tokens that rely on "concept hype" and lack actual users often fail to withstand scrutiny. Just as Amazon shut down many product lines after 2000, leaving only its core businesses that truly added value to consumers, we should consider whether a crypto project genuinely solves problems or has loyal users.

Interest Rates Set the Rhythm: The high-interest era in the U.S. at the end of the last century suppressed bubbles, but the subsequent low rates fostered a tech revival. Today's Federal Reserve policy is equally crucial: the early phase before the internet bubble burst was characterized by high rates (6.5%), accelerating the bubble's collapse; while the low rates around 1% in 2003-2004 provided breathing room and growth opportunities for tech companies like Amazon. In contrast, the crypto bubble took off from a 0% rate in 2020, and the rapid rate hikes above 5% in 2022 severely impacted the market. If the Fed continues to cut rates in the future, it would be a positive signal for risk assets. However, we must also be wary of macro risks (such as inflation pressures from trade frictions) and avoid blindly chasing rallies. A prudent strategy is dollar-cost averaging (DCA), maintaining patience, and avoiding panic selling during sharp declines.

Patience is Key: The journey from the 2000 internet bubble to Amazon's first profit in 2003 took three years; its true acceleration began after the launch of AWS in 2006. Ethereum's situation is similar: after the crash in 2022, its price quickly fell, and while it has rebounded by 2025, it is still far from its peak. The market needs time to restore confidence, refine technology, and build ecosystems. Based on current trends, some analysts believe Ethereum may not fully explode until 2028-2030, akin to Amazon's experience from 1997 to 2006. Investors should be patient, gradually accumulating quality assets at lower levels rather than rushing for short-term profits.

6. Conclusion: Rhyming History, Future Opportunities

The internet bubble and the cryptocurrency boom are like two rhyming poems: the initial revelry surged under different interest rate environments, rate hikes burst the bubbles at critical moments, and subsequently, low rates or policy support allowed the surviving strong players to be reborn.

Amazon grew from a $10 billion market cap in 2003 to trillions today, relying on solid fundamentals, technological innovation, and a favorable low-rate environment; Ethereum is also rising from its 2022 lows, building a foundation for recovery through its rich ecosystem, upgraded technology, and regulatory benefits. The crypto market in 2025 resembles the internet market in 2003, with opportunities and risks coexisting. As long as we remember the rhyming patterns of history: focus on fundamentals, embrace innovation, maintain user loyalty, diversify moderately, and hold patiently, we can steadily navigate the future waves.

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