Harvard Economist Claim Bitcoin Will Drop To $100 In A Decade
Bitcoin has been surging and despite a recent drop, its price remains exponentially higher compared to what it was years ago. However, it's inherent volatility has left its future hard to predict.
One Harvard economist believes he can see the future, and it's grim future at that. According to Kenneth Rogoff, a former chief economist at the International Monetary Fund, the cryptocurrency could drop to as low as $100 in the next 10 years.
In a recent interview with CNBC, Rogoff said that the likelihood of Bitcoin dropping to $100 is much higher than it reaching $100,000 within the next decade.
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"I think bitcoin will be worth a tiny fraction of what it is now if we're headed out 10 years from now," Rogoff told CNBC's "Squawk Box." "I would see $100 as being a lot more likely than $100,000 ten years from now."
According to Rogoff, aside from the illegal usage in money laundering and tax evasion, the cryptocurrency's actual uses as a transaction vehicle are very small. Government regulation will be the trigger for this eventual price drop although he stressed that it will take some time before a global framework of regulation can materialize.
Clearly, Rogoff does not share the sentiment of many Bitcoin enthusiasts who believe that the cryptocurrency would head "to the moon." However, that doesn't mean he's wrong and judging from the recent problems the cryptocurrency is facing, he could be right on the money.
Slow and expensive transaction costs have caused many merchants to drop Bitcoin as a mode of payment. The rise of government regulations in countries such as South Korea also took a toll in the cryptocurrency's value as many investors began selling off their holdings.
Still, many countries have embraced the cryptocurrency. Japan recent legalized it in the country and also officially recognized a number of cryptocurrency exchanges.
As Rogoff stated, for the Bitcoin apocalypse to occur, global regulation will be needed. As it stands however, it will take years before anything will be in place.
