“It’s not about innovation, it’s not about progress, it’s not about automation. Bitcoin – and other cryptocurrencies (except for the gold backed or oil backed ones, has become another financial ‘expression’ or ‘product,’ which belongs more to the realm of fraud than finance or economics,” Bruno wrote to RT.
Bruno compares bitcoin to Monopoly money, which can be minted by private individuals.
“It’s something akin to the New Testament, when Jesus multiplied the loaves of bread and the fish.”
According to the analyst, bitcoin is a bubble at best and Ponzi scheme at worst. Bruno says cryptocurrencies backed by gold or other assets can be a comfortable tool to invest in commodities, precious metals, etc., while bitcoin is backed by nothing.
Bruno predicts that the price of bitcoin will fall, as regulators and banks around the world take a harsher stance on cryptocurrencies.
“Nouriel Roubini, famous for predicting the 2008 financial crisis, expects to increase the value of zero dollars. He warns that the US Congress hearings that will see Christopher Giancarlo, president of the Commodity Futures Trading Commission (CFTC), and Jay Clayton, president of the Securities and Exchange Commission (SEC), the two main financial market authorities testify on cryptocurrencies. That could set off more warnings.”
Cryptocurrencies have fallen dramatically over the last few weeks amid tighter regulation and government crackdowns and the ongoing US investigation on market manipulation.
“You may have noted that bitcoins dropped to $6,000 on Monday, Jan. 6. They recovered on Wednesday, but be careful. That, says Roubini, might be a manipulation tactic called “wash trading” to support the price of bitcoin. Wash trading occurs when someone who buys and sells a bitcoin, or a stock or any other asset to manipulate the markets,”says Bruno.
The blockchain technology behind bitcoin is here to stay, when “bitcoin and what will remain after bitcoin is reduced to bits of dust.”