Wednesday, November 8, 2017

Roubini: Bitcoin feeds on itself It is a 'gigantic speculative bubble' that will end

Roubini: Bitcoin is a 'gigantic speculative bubble' that will end

BI: Aren’t you scared by such technologies like blockchain? Because of it, human factor can be reduced to the minimum. And who benefits? The cryptocurrencies, like bitcoin that the CEO of JP Morgan, the largest investment bank in the world, already called the big fraud.

Roubini: First of all, I would separate the blockchain from the bitcoin. Blockchain creates an enormous chance to increase productivity in many companies and I think the technology to be something very good. But the bitcoin and other cryptocurrencies – this is something entirely different. In my opinion, there is a gigantic speculative bubble related to the bitcoin.

BI: Why?

Roubini: Because this is neither a serious method of payment nor a good way to store capital. The bitcoin feeds on itself. There are no fundamental reasons for its price to reach such levels. What’s more – it is also used by criminals, for their shady business. I think that more and more countries will start to make cryptocurrency exchanges illegal like China did. New regulations will be adopted. So, this will find its end.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

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