A Yale expert has added his voice to the growing list of bitcoin naysayers by arguing that it is a ‘dangerous speculative bubble.’ The digital currency has been experiencing record highs throughout 2017. However, despite the impressive journey that bitcoin has been on, that hasn’t stopped many from claiming that it is in a bubble. Another voice added to that list is Stephen Roach, a Yale University senior fellow and the former Asia chairman and chief economist at Morgan Stanley, reports CNBC.
Speaking to CNBC’s ‘The Rundown’, Roach said: "This is a dangerous speculative bubble by any shadow or strength of the imagination. I’ve never seen a chart of a security where the price really has a vertical pattern to it. And bitcoin is the most vertical of any pattern I’ve ever seen in my career."
CME and CBOE, big players in the derivative and futures markets, have announced that they are ready to launch Bitcoin futures soon. NASDAQ has also unveiled similar plans.
However, Roach does not think these developments will bolster confidence in the world’s largest cryptocurrency. On the contrary, he thinks this makes the coin “somewhat dangerous” for potential investors, considering its “lack of intrinsic underlying economic value to the concept.”
The former Morgan Stanley executive is sure that Bitcoin would ultimately implode: “Like all bubbles, they burst,” he said. “They go down, and the one who's made the last investment gets hurt the most, there's no question about it.”
Roach’s point of view is very similar to that of JPMorgan CEO Jamie Dimon, who called Bitcoin a fraud and said it would burst sooner or later. The current CEO of Morgan Stanley, James Gorman, recently said that Bitcoin was getting too much attention and was not a safe investment. However, he agreed that the cryptocurrency is here to stay.
Despite criticism from several other top economists and investment bank executives, Bitcoin continues to set new price records.
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