If you have been in the crypto space long enough, then the phrase, “Bitcoin is a bubble,” has probably become music to your ears. From banking giants to seasoned economists, journalists and the world’s top billionaires, there have been countless predictions suggesting that the Bitcoin bubble will pop.
These criticisms have been around since the beginning. As far back as 2010, one critic claimed that the only thing that kept Bitcoin alive was its novelty.
Fast forward to 2017, when billionaire investor Warren Buffett dismissed
the idea of Bitcoin holding any value, because it didn’t make sense. According to him, “you can’t value bitcoin because it’s not a value-producing asset...it's a real bubble in that sort of thing.” Similarly, Nouriel Roubini, the professor of economics at New York University who accurately predicted the 2008 global financial crises, dubbed Bitcoin “the mother of all bubbles
” favored by “charlatans and swindlers.”
Interestingly, despite all the doomsday predictions, Bitcoin and the cryptocurrency industry appear to be waxing ever stronger. Compared to the bull run of late 2017, the recent 2020 rally was led by institutional investors
. Several companies now accept Bitcoin as a payment option (including, briefly, Tesla) and El Salvador has even adopted it as legal tender
To be fair to critics, the cryptocurrency industry
has had its fair share of ups and downs — investors have lost money in Bitcoin and other cryptocurrencies. In the recent market crash, the “Crypto Fear and Greed Index
” entered the “extreme fear” zone, suggesting that some investors had become uncertain over the future of the industry. The bottom line with Bitcoin and other cryptocurrencies is that you must do your own research before investing any money.
Additionally, as a rule of thumb, do not invest more than you are willing to lose.
That being said, here’s a rundown of 20 times experts failed to correctly predict the end of Bitcoin.
In December 2016, a team of MIT Fintech alumni claimed
that “Bitcoin is a bubble that like Tulip, South Sea, Dot.com or Subprime will burst”
[sic], after launching a so-called global-scale security test on the network. The price of Bitcoin was $771.
Still in 2016, when Bitcoin traded at around $744, Circle CEO Jeremy Allaire said
during the Finance Disrupted event that no one would still be using Bitcoin in five to ten years’ time. Guess what? Allaire bought
$100 worth of Bitcoin in late 2020.
2017 will probably go down in history as the year with the highest number of Bitcoin death predictions.
Predicting the imminent death of Bitcoin, Morgan Stanley analyst James Faucette sent a note
to clients warning them that the real value of the cryptocurrency might be $0. “If nobody accepts the technology for payment then the value would be 0.
” Bitcoin was trading at $13,709. Today, the banking giant now offers Bitcoin exposure
to its wealthy clients.
Speaking to French newspaper La Tribune in November 2017, Éric Pichet, a professor at the Kedge Business School in France, suggested
that Bitcoin would die because of a grand theft — either from a collective ban by global governments or through a hack into its underlying blockchain technology.
In the same month, and with Bitcoin trading close to $10,000, Nobel Prize-winning economist Joseph Stiglitz said
, “Bitcoin is successful only because of its potential for circumvention, lack of oversight.
” He went as far as advising that the cryptocurrency should be “outlawed.”
reported that several Central Bankers claimed that the success of bitcoin and other cryptocurrencies was just a bubble. For instance, European Central Bank policymaker Ewald Nowotny remarked: “The problem with bitcoin is that it could easily blow up and central banks could then be accused of not doing anything.
” Bitcoin was still trading at $9,096 then.
In December 2017, Robert Kuttner, a columnist with HuffPost, described
Bitcoin as an “unholy alliance between cyber-utopians, money-launderers, financial fraudsters, and ultra-free-marketeers,”
adding that it was on “a wild speculative ride.”
The flagship crypto had enjoyed a massive bull run and was trading at $14,831.
Famous gold bug Peter Schiff was still in disbelief when Bitcoin jumped to $17,000
in December 2017. According to him, “these currencies are going to trade to zero or pretty close to it when the bubble pops […] Right now, the only reason why people are buying bitcoin is because the price is going up. When it turns around, they are not going to sell it for the same reason."
Nobel prize winner Paul Krugman told Business Insider
in December 2017 that Bitcoin was only rising because nobody understood it. Bitcoin was priced at $17,639.
“Bitcoin, nobody understands it [...] This is even more obvious, I think, than the housing bubble was. And that one was, I thought, tremendously obvious.”
Danish bank Saxo predicted
that Bitcoin would fall to $1,000 by 2019, claiming that “the rise of bitcoin and other cryptocurrencies has been one of the most spectacular phenomena of financial markets in recent years. Bitcoin will continue to rise — and rise high — during most of 2018, but Russia and China will together engineer a crash.”
Bitcoin was $16,547 when the prediction was made in December 2017.
On Dec. 12, 2017, and at a price of $16,731, Washington Post columnist Matt O'Brien said
, “Bitcoin might be the most perfect bubble possible.
” According to him, Bitcoin’s phenomenal rise in the past year was nothing short of a bubble. “What else would you call something that, as of Tuesday morning, has gone up 47 percent the past week, 181 percent the past month, and 2,119 percent the past year?
Real-life Wolf of Wall Street Jordan Belfort slammed
Bitcoin as a "huge, gigantic scam,"
likening it to the tulip bubble. “I think it’s a huge danger right now that people are looking at this as the next great thing, it’s a bubble for sure.
On Dec. 15, 2017, Andrew Bailey, chief executive of the Financial Conduct Authority (FCA), told
investors to “be prepared to lose all [their] money”
if they invested in Bitcoin. The price of the crypto was just $16,547.
In early 2018, Bitcoin plunged to $4,000, marking the beginning of a prolonged crypto winter that lasted until 2020. As expected, many Bitcoin critics rose to the occasion to predict the ultimate demise of the digital asset.
Among them was Roubini, a professor at NYU’s Stern School of Business. He reportedly said
: “With BTC down almost 80% from the peak (from 20K to ~4K) & all other cryptocurrencies down 80% to 99% I rest my case that this crypto bubble went bust for good. I feel vindicated.”
By December 2018, Bitcoin had fallen even lower to $3,496, giving Canadian Calvin Ayre, a loyalist of Bitcoin Cash, enough reason to say that Bitcoin would become worthless by the next year. He said
: “I’m afraid I am predicting it to go to zero value as it has no utility, it does not do anything and they intentionally are anti-scaling.”
Despite the fact that Bitcoin reclaimed some of its previous levels in 2019, the negative predictions still continued. In September, Jim Rogers, an American investor and the author of the best-seller, Investment Biker,
made a rather bold claim
when he said that “all cryptos will disappear.”
Similarly, Mark Dow, a former US Treasury and International Monetary Fund economist, boasted
on Twitter in November that “Bitcoin is dying.”
David Rosenberg, founder and chief economist at Rosenberg Research made a case against the volatility of cryptocurrencies. In his words, Bitcoin was a “massive bubble.”
His statements were made in December 2020 and Bitcoin was trading at $22,000.
It’s 2021, and the bearish predictions are yet to arrive. In July, veteran investor Hamish Douglass speculated
that Bitcoin would eventually crash to zero despite its $33,798 price tag. “I predict all these forms of cryptocurrencies that are not backed by central banks or backed by assets will ultimately go to zero. I can’t tell you when it will happen, but it’s inevitable that it will go to zero.
And more recently, Professor Steve Hanke tweeted
: “Wildly volatile, highly speculative, and fundamentally worthless. #Bitcoin will NEVER be considered a currency. Are the #BTC evangelists and enthusiasts blindly digging their own graves?”
There have been predictions that Bitcoin would not survive since 2010. To date, there have been hundreds
of failed predictions from experts. However, from regulator pressures to comments that it is mainly used by criminal elements for illicit activity, Bitcoin has managed to sail through it all. So far, no one has been able to correctly predict the death of the flagship cryptocurrency.
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