Every time the Bitcoin price shows signs of positive momentum, the naysayers will come out in droves. Despite the current Bitcoin momentum, a lot of economists continue to claim the price will collapse sooner or later. The latest person to do so is Kenneth Rogoff, whom some people may recall as the author of a book on currencies written a few years ago. Although the current Bitcoin price trend has created a lot of room for speculation, Rogoff’s negative attitude toward cryptocurrency isn’t warranted in the slightest.
In a way, it is not entirely surprising to see so-called experts continue to call Bitcoin a bubble. After JPMorgan Chase CEO Jamie Dixon did so, the Bitcoin price rebounded and soared to US$4,800 in quick succession. A lot of people still feel Dixon made that particular claim as a way to negatively impact the Bitcoin price so that he could buy in cheaper. Whether or not that was actually the case will always remain a mystery.
Whether or not Kenneth Rogoff is deploying similar tactics remains to be determined. It is evident his current comments come at a rather intriguing time for Bitcoin, as the price has experienced a major rebound over the past few days. Some people seemingly cannot deal with this new form of money, even though that shouldn’t come as a big surprise to anyone. None of the traditional financial laws or guidelines apply when it comes to Bitcoin and cryptocurrency.
In his latest article, Rogoff notes that the Bitcoin price increased by over 600% over the past 12 months. That is a massive amount of value gained in short order, although that doesn’t automatically make it a bubble or anything of the sort. Very few people assumed that Bitcoin would reach this astronomical value so quickly. A lot of experts tend to forget that Bitcoin is only nine years old and remained virtually worthless for its first two to three years.
Rogoff also puts forth that governments hold the key to the future of Bitcoin. That may be a rather strange train of thought, even though it is not entirely uncommon to hear such things said either. We have seen various governments meddling in the world of cryptocurrency over the past few years. China in particular has taken some intriguing stances toward Bitcoin, whereas Japan has shown the entire world that regulating Bitcoin and making it legal tender is an option worth exploring.
As it turns out, most nations are still on the fence as to how they will regulate Bitcoin moving forward. In Europe and the US, a unified guideline is not expected anytime soon. While that doesn’t mean governments aren’t looking into the matter, it is a pretty complicated state of affairs right now. Moreover, there is the fact that Bitcoin regulation is utterly pointless. One can’t regulate what cannot be controlled. Bitcoin has no leader, company, CEO, or centralized backbone whatsoever.
Kenneth Rogoff claims it is a “folly to think Bitcoin will ever supplant central bank-issued money.” That’s a remarkable claim, and one that may prove to be wrong in the long run. It is certainly true that central bank-issued money will not disappear altogether. In fact, such money may even become digital in the form of central bank digital currencies. Additionally, Rogoff claims that “cash at least has bulk, unlike virtual currency.” That is a very controversial statement, which clearly shows a lack of understanding on how cryptocurrencies work and are perceived these days.
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