The fate bitcoin faces is a grim one, according to Nobel-prize winning economist Robert Shiller, who predicts the cryptocurrency will either implode or drag on, comparing it with the tulip craze of the 17th century.
“It has no value at all unless there is some common consensus that it has value,” Shiller, who is also Yale professor, told CNBC. The 2013 Nobel laureate in economics says while “other things like gold would at least have some value if people didn’t see it as an investment,” he doesn’t know “what to make of bitcoin ultimately.”
In December, bitcoin saw a dramatic surge in its price, hitting new record highs every day and ultimately reaching $20,000. However, a plunge followed, with bitcoin now trading at around $12,000.
“It reminds me of the Tulip mania in Holland in the 1640s, and so the question is did that collapse? We still pay for tulips even now and sometimes they get expensive,” Shiller went on, referring to an economic bubble in the Netherlands in 1637, when after prices frantically grew the market suddenly fell apart.
“[Bitcoin] might totally collapse and be forgotten and I think that’s a likely outcome but it could linger on for a good long time, it could be here in 100 years,” Shiller said.
The economist has previously spoken of bitcoin on numerous occasions, calling it a “fad” and saying the “story” behind bitcoin drives enthusiasm for it. “A new form of money that… sounds extremely revolutionary and involves a very clever use of cryptography” has inspired interest among people.