Famous Economist Talks About the Future of Bitcoin: "BTC Will Never..."

Nouriel Roubini, CEO of Roubini Macro Associates and economist at Atlas America Fund, reiterated his skepticism towards Bitcoin, describing it as a "speculative asset" and rejecting its potential as a legitimate currency or protection against inflation.

Roubini, speaking about the recent increase in Bitcoin prices, pointed out the volatility inherent in Bitcoin's nature and the lack of fundamental utility as a medium of exchange.

Roubini criticized Bitcoin and other cryptocurrencies for failing to meet the basic requirements of a currency. He argued that Bitcoin is neither a scalable means of payment nor a stable store of value. "Bitcoin is not an economic unit of account, it is not a stable store of value, and it is not a scalable means of payment," he said, referring to his history of extreme price fluctuations.

Pointing to the example of El Salvador where Bitcoin has started to be used as legal tender, it was stated that less than 1% of the transactions in the country are conducted using cryptocurrency. He added, 'I don't think Bitcoin will ever become a currency.'

Roubini, who also mentions the claims that Bitcoin provides protection against inflation or depreciation of fiat currencies, does not agree with these views. Roubini, who says 'Historically, Bitcoin has had a high correlation with the stock market,' explained that instead of acting as a counterweight during inflationary periods, Bitcoin tends to rise and fall along with stocks. Unlike gold, which is traditionally a reliable hedge during inflationary periods, Roubini argued that Bitcoin's performance is not consistent with such expectations.

Roubini also expressed concerns about regulatory developments in the cryptocurrency field. While acknowledging the increase in individual usage, he warned that looser regulation could lead to another speculative bubble. He said, 'The risk is that we are moving towards very little regulation that could allow for fraud and market failures, similar to what we have seen with FTX and Sam Bankman-Fried'.

He warned that a lack of oversight could increase systemic risks in the cryptocurrency ecosystem, resulting in another cycle of bubbles and bursts. "A lot of players in this space are shady, and weak regulations only increase the risk of fraud and volatility," Roubini said.