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It was just your usual fragmentation I think. Seems everyone to this day has differing opinions of what rave was and what it should be. What I think happened is at one point all these people went to these things and kinda embraced each other's differences, but eventually after the popularity was large enough they all fragmented off into their own little subniche's. Maybe when interest was low all these different people had no choice but to get along together, but when there were enough people the crowds started branching off into their own different flavors of partying. Kinda like what happened to rock music after elvis, people all took it in different directions.
From what I've read it seems the general theme of these raves was a chaotic environment were anything was permittied to happen and all kinds of strange new ideas were explored, In that sense I don't think that rave is dead because some people surely still do this kind of thing, maybe it is not the same as it was before, but by definition it couldn't be, how can one explore new ideas and have it the same as it was 10 years ago?
But it is a combination of many things that killed rave, fragmentation, persecution by the law, commercialization, popularity, vanity, everyone had their own reasons for quitting it seems.
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