It is worth noting that a lot of the money if not the vast majority of the money contributing to the ICO boom is due newly minted to Bitcoin and Ethereum millionaires. These people will be used to the extreme volatility of the crypto market.
That being said it means that the height of the bitcoin bubble is not going to be in the same league as previous ones and we must look at the market cap of the whole space as the gains are shared across 1000’s of assets. To this point, this price rise is 10x the size of the last. It is simply impossible to create a correctly diversified portfolio exclusive to the cryptocurrency space. This is a single asset class. Saying that people are diversified because they own multiple cryptocurrencies is like saying that you are diversified because you hold stocks in multiple mining corporations. A regulatory change for miners affects them all, some more than others as each has operations in different local areas for different minerals. As such, the market should move as one entity, with some fluctuations between each asset. I just do not see ICO’s going to trillions of dollars in market cap before a major correction/shakedown until the regulatory risks and uncertainty are appeased.
The tech bubble circa 2000 was in the trillions before the crash. However, remember that was all above board and within the traditional global markets allowing anyone and everyone to invest with the full confidence that they would not be hit with a regulatory burden in the future. When the crypto space has the blessing of these incumbent institutions, the whole market could very easily go to the trillions. Whether or not they will get the blessing, I am uncertain. What is certain is that the Americans are closely watching the Chinese, as they appear to be making the first move. What they may and probably will end up doing is the opposite of the Chinese, China bans them America opens the door to take advantage of the technology while at the same time trying to undermine the Chinese economy. I can see them doing this, however it would be a very risky move for them, as it would also mean undermining their own fiat economy.