Bitcoin, the world’s largest cryptocurrency, is in the news again after American economist and popular crypto-critic Nouriel Roubini claimed that it had no intrinsic value, adding that BTC is heavily manipulated. Taking to Twitter on Thanksgiving Day, the crypto-skeptic, in fact, also went on to blame retail investor FOMO for the latest Bitcoin price drop. Roubini said,
“See also the academic evidence that Tether is used to manipulate the Bitcoin market. And look at the recent indictment of BitMex and his criminal CEO & gang. It [Bitcoin] has no intrinsic value, it is not backed by any asset, it is not legal tender, it cannot be used to pay taxes.”
Roubini has been one of the industry’s oldest critics, with the economist going as far as lauding the CFTC’s charges against BitMEX CEO Arthur Hayes a few weeks ago, having claimed that Hayes and his firm were running a “massive criminal operation.”
In the past, the economist had also called out the stablecoin Tether for the “criminal manipulation” of Bitcoin rallies.
Bitcoin has risen by 134% this year, hitting a record high of $19,293 this week, before falling by 12% on the price charts. The said fall came on the back of Bitcoin trading close to its ATH levels, with crypto-investors soon cashing in on their holdings, pulling the price of the cryptocurrency down. It should be noted here that experts in the field had already predicted this drop, labeling it as an inevitable and regular price correction.
However, while influencers and Bitcoin bulls have noted BTC’s potential as a safe-haven asset, Roubini seems convinced that Bitcoin has “no role” to play in institutional or retail investor portfolios because it isn’t a currency, unit of account, or a scalable means of payment. Roubini even argued,
“Retail suckers with massive FOMO have been jumping again into BTC as they did in late 2017 when price went from 10K to 19K only to crash down to 3K in 2019. Only winners were the manipulative whales that dumped their BTC to the retail suckers & led to its 85% price fall.”
What is interesting here is that Roubini seems to be discounting the scale of institutional participation during this bull rally. Over the past few months, the likes of Square and Microstrategy have invested millions in Bitcoin. While the popular economist might be quick to denounce them as “manipulative whales,” it should be noted that unlike back in 2017, many of these entities have been quick to highlight BTC’s potential as a more “ubiquitous currency in the future.”
What is even more interesting is that with the latest series of tweets, Roubini seems to be backtracking on his recent statements. A few weeks ago, back when BTC was consolidating its position to climb on the charts again, the crypto-skeptic had conceded that Bitcoin was “maybe a partial store of value.” While many saw this as a sign of the economist warming up to Bitcoin and cryptocurrencies, it would now seem that this wasn’t to last for long.