Bill Harris, co-founder and former CEO of PayPal, and a noted Bitcoin currency critic, expressed his opinion in an interview with CNBC Fast Money, and said Bitcoin has no value and the price will go close to zero.
Already at the end of April, Bill Harris has moved on an article about Bitcoin on Recode and has left no cliché. To say, he was not enthusiastic about Bitcoin, would be an understatement. At the same time, he referred to Bitcoin as the “biggest scam in history” and as a “colossal pump-and-dump system” that the world has never seen before.
Yesterday, Paypal’s former CEO joined CNBC’s Fast Money, calling Bitcoin a “cult that goes straight to zero”. When Harris was asked to substantiate this statement, he stated:
I do not think I said it’s going to zero, I said it will eventually go very close to zero, because there’s no value.
He went on and said:
It can be summarized as the cult of bitcoin makes many claims – that it is immediate, free, scalable, efficient, secure, globally accepted and useful. It is none of those things
Although Harris believes that it is difficult to move money across borders, he firmly believes that the world needs “faster networks, not Bitcoin or XRP, to move money across borders.”
I see absolutely no reason why Bitcoin is useful. It is useless as a payment mechanism and ridiculous as a store of value.
But he kept the oldest cliché to himself until the end. According to Harris, Bitcoin has only a benefit for criminals.
I’m not saying that there are no fabulous visions in the world that should be funded. In the case of bitcoins, apart from criminal activity, I cannot find a single reason.
Arguments against the clichés of Harris
“Bitcoin’s value will go to zero”
Just recently, economists at the prestigious Yale University conducted a study , and have published reports that estimates the likelihood of Bitcoin running at zero to 0.3%.
Aleh Tsyvinski and Yukun Liu, have used “textbook financial tools” on cryptocurrencies to better understand them. For the study, they looked at Bitcoin, Ripple, and Ethereum and investigated whether they behave like other asset classes, especially stocks, traditional currencies, and precious metals. The researchers concluded that the likelihood of Bitcoin dropping to zero and becoming unusable is 0.3%.
They also said that investors should include Bitcoin in their portfolio and its share should be somewhere between 1% and 6%.
“Bitcoin is not suitable as an alternative currency due to its volatility”
The technology of Bitcoin, as well as other crypto currencies, such as Etherum is still in its infancy. Nevertheless, a large number of companies have already accepted Bitcoin, along with some well-known websites and shops. The mainstream adaptation is in full swing.
Almost every day there are new reports that more and more companies, shops and also countries and banks recognize BTC as a legitimate means of payment. For example, the central bank of St. Louis recently named Bitcoin a ” great innovation .” The Nasdaq is likely to offer to trade Bitcoin and crypto currencies.
The ICE, the company behind the New York Stock Exchange, wants to launch the trading platform ” Bakkt “. The infrastructure for institutional investors has been significantly expanded in recent months by numerous companies. Everything indicates that the still young market will continue to mature in the coming years.
“A bitcoin has no intrinsic value”
Since the decoupling of the US dollar from the gold standard in 1971, the Fiat currency system has been based precisely on the system Harris describes.
Last year, even a chief strategist at Deutsche Bank, Jim Reid, before the unstable fiat currency system and a renewed global economic crisis warned . He published an analysis in which he wrote that the Fiat money system could end soon and cryptocurrencies like Bitcoin could take over the global financial market.
According to him, the main reason for this was the departure from the gold cover of the US dollar as a world currency in 1971 under the then President Richard Nixon. The existing Fiat currency system allows states to postpone crises and to mask emergencies. This is exactly what is happening in the United States, for example, the budget deficit has increased by 20% in the last ten months.