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Topics: Bitcoin, Business, Cryptocurrency, Money, Donald Trump
Callum Jones
Topics: Bitcoin, Business, Cryptocurrency, Money, Donald Trump
A financial expert and Nobel Prize winner has issued a harrowing prediction for the future of Bitcoi,n and it's certainly not looking good.
While cryptocurrency is often in the headlines because of controversial matters, aka Hawk Tuah girl recently, there's no doubt crypto has seen quite the boom in recent months.
A post-election boost has certainly been a thing in the US, though with Donald Trump being the first US President to buy goods using crypto, we should've seen it coming.
The POTUS and the First Lady have even released their own meme coins, which has seen the pair come under fire - but it's no doubt contributed to its relevance today.
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But now, Nobel Laurette Eugene Fama has made a surprising prediction for the future of Bitcoin, claiming it could soon become 'worthless'.
The so-called 'Father of Modern Finance' has issued a bunch of warnings for keen crypto users, including the fact cryptocurrency has no real value.
While we all know the currency can fluctuate on the whim, Fama pointed out many companies refuse to accept crypto as an actual payment.
To put it simply, Bitcoin doesn't have the backing of a central authority, while flat currencies receive support from governments across the world.
The expert has suggested that if the demand for Bitcoin vanishes, so does its pricing - and this could ultimately be catastrophic for users.
Speaking on the Capitalisn’t podcast with Luigi Zingales and Bethany McLean, Fama said: "Cryptocurrencies are such a puzzle because they violate all the rules of a medium of exchange.
"They don’t have a stable real value. You know, they have highly variable real value. That kind of medium of exchange is not supposed to survive."
The Noble Prize winner added: "The problem with all the cryptos is, in order to create some trust in the system, you basically bound the supply, and once you bound the supply, the price is driven entirely by demand."
The podcasts hosts pushed Fame on the future of Bitcoin, and whether it would eventually dip to zero.
"I would say it’s close to one," he said before adding: "I’m hoping it will bust, because if it doesn’t, you have to start all over with monetary theory."
I mean, if you look at the Hawk Tuah girl fan who lost their 'life savings' after investing in crypto, then that really should be a stark warning - don't just invest your money blindly into crypto unless you really know what you're doing.