Nobel Prize-winning economist and 'father of modern finance' Eugene Fama, a professor at the University of Chicago, has offered a pessimistic outlook on cryptocurrency. He particularly predicted that the value of Bitcoin, regarded as the leader in cryptocurrency, has a high likelihood of reaching zero within the next 10 years.
On the 2nd, according to cryptocurrency news outlets CryptoNews and ProMarket, Professor Eugene Fama appeared on the podcast 'Capitalisn’t' on the 30th of last month, where he noted that "Bitcoin cannot perform its role as a currency."
He stated that Bitcoin "does not maintain a stable real value and has a highly volatile real value," adding that "due to its limited supply, the price is determined entirely by demand, which causes extreme volatility, making it unsuitable as an exchange."
Professor Fama is evaluated as a scholar who provided a logical framework for index-tracking funds with the proposition that 'all information in the market is immediately reflected in asset prices.' He jointly won the Nobel Prize in Economic Sciences in 2013 with Robert Shiller of Yale University and Lars Peter Hansen of the University of Chicago.
Fama also expressed a strong criticism, stating, "I hope Bitcoin collapses. If Bitcoin does not collapse, we will have to rethink our currency theory from the beginning." However, he showed an open attitude by acknowledging that there is a "possibility of being wrong" in his outlook.
Earlier, Bill Gates, co-founder of Microsoft (MS), also expressed negative views about Bitcoin and other cryptocurrencies. In an interview ahead of the release of his autobiography, Gates pointed out that "even people with high IQs are deceiving themselves about the nature of virtual currency."
Meanwhile, the price of Bitcoin is showing a sharp decline. The reigniting of the trade war originating from the United States has had a negative impact. As of 2 p.m. (Eastern Standard Time) on the 2nd, Bitcoin was trading at $97,759, down 5.0% from 24 hours ago, falling below the $100,000 mark.