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Dr. Doom strikes once again, calling crypto the mother and father of all bubbles.
During the just concluded SALT conference, which took place in Las Vegas over the week, the controversial crypto world was once more debated among reputable analysts.
Celebrated economist Nouriel Roubini, widely known as Dr. Doom, reminded his audience of his disbelief in Bitcoin and other cryptocurrencies. Debating with Michael Novogratz, Roubini maintained that Bitcoin and other cryptocurrencies have no value and as such don’t pass as a currency. He preached further that every currency must be a unit of account, valuable and a scalable means of payment. From his point-of-view, the so-called cryptocurrencies lack these qualities, and therefore they do not earn the name ‘cryptocurrency.’
Popular investor and former manager of hedge fund Novogratz made his argument, stating firmly that Roubini is underestimating the future of the crypto space. He explained that Bitcoin has risen a great deal since the crash in 2018. The unexpected rise ends every debate. Bitcoin has won. And people around the world now see it has a legitimate store of value (SOV).
Novogratz pushed further and challenged Roubini to put his money where his mouth is. He suggested a bet where Roubini gets to wear a T-shirt with the inscription ‘I love Bitcoin’ if the price of the crypto coin goes beyond the market price of about $6,000 by Christmas time (now it’s already at around $7,300). Should it fall below this market price, Novogratz agreed that he will wear a T-shirt with the inscription ‘Nouriel was right.’
Although Roubini did not agree or rebuff the suggestion, he was clear on the fact that he does not care about the fate of Bitcoin. According to him, the term cryptocurrency is an outright misnomer. Bitcoin and other crypto coins do not fit the bill of currencies – both fiat and virtual currencies.
Bitcoin, he argued, cannot scale efficiently. While it is capable of handling only seven transactions in a second, traditional credit cards are capable of handling as much as a thousand (or even more) transactions in that same time frame. Besides its inefficiency, it is very volatile and easily susceptible to fraud, making it a misfit for the term currency.
Responding to Roubini’s firing, Novogratz explained that there is a huge amount of stuff going on in the crypto space. And somehow, there’s been a little miracle. Bitcoin is having a ‘bounce back’ and plenty of people still consider it as a store of value. He pointed out that big business like Fidelity and Facebook are implementing or considering investing in the space. Therefore, he strongly believes that Bitcoin and crypto, in general, have got a healthy future before them.