It is impossible to predict what will happen to Bitcoin in the near future, but one academic has warned it may disappear soon. Earlier this month, Professor Eswar Prasad of Cornell University’s School of International Affairs said: “Bitcoin itself may not last that long.”
According to Prasad, the maiden cryptocurrency may eventually fade away due to the lack of efficiency and inability to facilitate exchanges as a mode of payment.
In his view, emerging cryptocurrencies are proving more efficient than bitcoin, while most digital assets will likely disappear once central banks implement CBDCs (Central Bank Digital Currency).
He said that Bitcoin would not be remembered as a cryptocurrency but rather as a tool for introducing blockchain technology. He noted that blockchain technology would be more transformative in improving finance and routine transactions.
Cryptocurrencies have “sparked a thought process around issuing digital versions of their own currencies by central banks,” Prasad said. Prasad argues that CBDCs will be crucial as they may facilitate low-cost payment options, increasing financial inclusion.
He also noted that Bitcoin has set up a competition for other alternative currencies that rely on the blockchain. Prasad is the author of “The Future of Money: How the Digitization Revolution is Transforming Currencies and Finance”. More stable coins are emerging to offer a better transaction method than Bitcoin.
He pointed out that such digital currencies are beneficial as they provide a low-cost payment option that everybody can use, which increases financial inclusion and possibly financial stability.
According to Prasad, blockchain technology has proven very effective in some of the newer cryptocurrencies. As he puts it, blockchain technology will “fundamentally transform” the way finance is done and the way we conduct our daily transactions, like buying a house or a car.
The scholar noted that despite high volatility, no currency or asset has consistently increased in value, and this fate might befall Bitcoin as well since the asset has no fundamental value.
Bitcoin and the global cryptocurrency market have experienced high volatility in recent weeks, plunging below $50,000. By press time, the asset was trading at $46,800, dropping almost 3% in the last 24 hours.
