Dr. Doom Declares ‘Crypto Apocalypse’, Calls Blockchain BS, Says Bitcoin Is Not Money
Nouriel Roubini just doubled down on his reputation as “Dr. Doom”. The famed NYU economist, who earned his Ph.D. at Harvard, lambasted blockchain, Bitcoin and everything crypto at the BlockShow conference in Las Vegas.
Having accurately predicted the global financial crisis of 2008, Roubini is regarded as an expert who understands how asset and credit bubbles form and when they’ll pop.
Here are Roubini’s key observations.
The overall status of cryptocurrencies
According to Roubini, it’s dead.
“In the space of crypto, you cannot do any transactions. Nobody’s using Bitcoin or anything else for transaction purposes.”
Roubini says he can see a bubble based on his academic experience and research.
“This is the mother of all bubbles.”
“There has been a total collapse this past year in the cryptocurrency space. It’s a crypto apocalypse.”
“Maybe Bitcoin is not a fraud, but it’s not scalable. So it’s nice, it’s there, but it doesn’t have any future.”
“You can create a fund of a fund; you can create a hedge fund; you can create whatever you want to. But if you invest into assets that on average lose 95% of their value in nine months, nobody’s going to invest in that space. Why would anybody want to go and lose money, right, unless you’re trying to short the space and make money that way. So there’s a lot of talk about institutional investment getting in but this is a space where you have lost 95% of your wealth if you entered this year, so nobody’s interested.”
Roubini says the crypto markets are rife with hundreds of pump and dump schemes, spoofing, wash trading and market manipulation, and that there is no way the SEC should approve a Bitcoin ETF.
“It’s just nuts. It’s just delusional. It’s just a bunch of people in this space who are trading shitcoins day in and day out who have lost all of this value, and no serious institution is going to seriously think about it. That’s the reality.”
The markets will be decimated because, according to Roubini, 99.9% of all coins will get wiped out. He agrees that Bitcoin may linger.
“Bitcoin’s going to be there. It’ll be worth close to zero, but it’s going to be there.”
Addressing financial market inefficiencies
Panelists spoke about the distrust that has permeated the current financial system, rooted in the global financial crisis which revealed bank scams and unfair business practices. Roubini feels that those flaws, failures and inefficiencies are being addressed today.
“It’s called fintech. But fintech has nothing to do with blockchain. Why do you need blockchain?”
According to Roubini the applications that can right the wrongs and improve the financial system are based on artificial intelligence and big data and the Internet of Things. Not blockchain. Alipay, WeChat Pay, Venmo, Square, PayPal – these are the digital payment systems that are helping billions of people around the world do business and make payments.
“It has nothing to do with blockchain. It’s all talk. It’s all bullshit.”
Roubini disputes claims that cryptocurrencies are decentralized.
“This system is the most centralized system ever. Miners, exchanges, developers – concentration of wealth. It’s all bullshit.”
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