Earlier on Tuesday Kenneth Rogoff, Harvard University professor and economist gave his opinion regarding the rapidly trending cryptocurrency Bitcoin. He said that the probability of bitcoin prices falling to $100 is more likely than that of the digital currency trading at $100,000 a decade from now
Rogoff also quoted on CNBC’s “Squawk Box” by further adding “I believe the worth of bitcoin will be a tiny fraction compared to its current rate if we’re headed out 10 years from now … I would see $100 as being a lot more likely than $100,000 ten years down the line,”
Rogoff further explained his predictions which will cause the drop by stating the fact that the development of government regulations will be a major factor which would cause this drop. However, he was quick to add that a considerable amount of time would be taken for developing a global framework of regulation.
He then went on to add “It really needs to be global regulation. Even if the U.S. cracks down on it and China cracks down, but Japan refuses to do so, people would still be able to still launder money through Japan,”
The former chief economist of the International Monetary Fund (IMF) also added “Basically, if you take away the possibility of money laundering and tax evasion, it barely has any actual application as a transaction vehicle,”
Undoubtedly being a digital currency with no physical appearance so it naturally has been amalgamated with illegal transactions, still, it isn’t the case for being overly misused as estimates of the proportion of the digital currency used in illicit practices keep on varying. The president and co-founder of Blockchain Intelligence Group, Shone Anstey estimated that the level of illegal transactions in bitcoin had gradually dropped to 20 percent in 2016 and was “considerably was lesser” as compared to 2017.
The development of regulatory as far as the cryptocurrency market is concerned depends completely on individual countries. The fact that Bitcoin has already been legalized as a currency by Japan in 2017 and also the country announced officially that they acknowledged quite a few cryptocurrency exchanges. But in spite of this announcement to everyone’s amusement, an astonishing theft took place in which tokens worth $530 million was reportedly stolen in January. This breach called for authorities to push for further improvements in security.
Where countries have only been in talks for developing securities South Korea has already made it a mandatory rule which would only permit a user to trade cryptocurrencies using their real-name bank accounts.
Blockchain technology protecting the bitcoin bubble from popping.
As per Coinmarketcap Bitcoin was trading at around $11,168.90 on Tuesday. The digital currency has dropped by 16 percent this year, after reaching an all-time high of $19,000 in December last year.
Rogoff believes that the main reason why authorities have been reluctant to take any measures when it comes to regulating Bitcoin is due to the fact that the technology behind the digital currency presents a tremendous potential for the future. He also stated, “They want to see the technology develop,”
Rogoff further said that he believes that, if you see the history of currency the private sector has been the major contributors to “inventing everything” right from standardized coinage to paper currency.
Bitcoin is just one of the many applications of the revolutionary blockchain technology, a term utilized while describing the distributed ledger technology which permits transactions to be recorded and stored,.this has also been targeted as an area which has massive growth potential.
Rogoff’s predictions cannot be taken lightly as notably, this isn’t the first time the economist has stated that the cryptocurrency prices will drop. Even Before bitcoin sold off in December 2017, Rogoff already had stated on CNBC in October 2017 saying that, given the increasing attempts made by governments to regulate the cryptocurrency space it is only a matter of time till the prices of the digital currency would drastically “collapse”.