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Economist Nouriel Roubini, also known as “Dr. Doom, “admitted that bitcoin could be a store of value. Roubini sees a” great revolution “coming in the next three years due to the launch of its own digital currencies by central banks.
Nouriel Roubini sees Store of Value in Bitcoin
After years of publicly mocking and ridiculing bitcoin, Nouriel Roubini admitted that bitcoin could be a partial store of value.
Roubini teaches at New York University’s Stern School of Business and has his own business consulting firm called Roubini Macro Associates. Famous for predicting the collapse of the 2007-2008 housing bubble, his bleak predictions earned him the nickname “Dr. Doom” in the media.
Dr. Doom has been a longtime critic of bitcoin. In a Senate hearing in October 2018, he called cryptocurrencies “the mother of all scams and bubbles”. He also said that the cryptocurrency world is a “stinking cesspool” and fundamentally worth nothing.
However, Roubini may have changed his view on bitcoin, at least to some extent. During an interview with Yahoo Finance on Friday, he was asked what he thought about bitcoin now that it has had a bull run. After reiterating his position that it is not a currency, Roubini said:
It could be a partial store of value because, unlike thousands of others what I call shitcoin, it cannot be degraded that easily because there is at least one algorithm that decides how much bitcoin supply increases over time.
As for other cryptocurrencies, Dr. Doom said: “most of the other ones are literally made on purpose and are devalued faster than the Fed is doing.”
Roubini also explained why he thinks “cryptocurrency is a misnomer”. In order for something to be considered a currency, he described that it must be a unit of account, a single numerary, a scalable means of payment, and a stable store of value that is not very volatile.
He claimed that bitcoin is not a unit of account because “Nothing is priced in bitcoin or any other cryptocurrency.” Also, he said it’s not a numerator because there are a lot of tokens, and it’s not a scalable means of payment because you can only make five transactions per second, unlike the Visa network where you can make 25,000 transactions per second.
As for the future of cryptocurrency as an asset class, he stressed that, in his view, “it’s not scalable, it’s not secure, it’s not decentralized,” [and] it is not a currency. “
In addition, he explained that many central banks are working on central bank digital currencies (CBDCs). When they are launched, each individual can have an account with a central bank from which they can make payments. When that happens, he said, “Not only do you don’t need cryptocurrencies, you don’t even need Venmo. You don’t even need a bank account. You don’t even need a check.” Dr. Doom elaborated:
The great revolution that we will see in the next three years will be central bank digital currencies. They will move digital payment systems.
What do you think of Nouriel Roubini’s opinion? Let us know in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
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