A Harvard economist says bitcoin is more likely to be worth $100 than $100,000 within the next ten years.
Harvard University professor and economist Kenneth Rogoff said on Tuesday that it is more likely that bitcoin prices will fall to $100 than the digital currency will trade at $100,000 in a decade.
“I think if we go ten years from now, bitcoin will be a fraction of what it’s worth now… I’d be more likely to see $100 ten years from now than $100,000,” Rogoff told CNBC. Squawk Box.”
“If you take away money laundering and tax evasion, its actual use as an operational tool is minimal,” said the former chief economist at the International Monetary Fund (IMF).
Many illegal transactions have been linked to Bitcoin, whose estimates vary in proportion to the use of the digital currency used in illegal activities. According to Shone Anstey, co-founder and president of Blockchain Intelligence Group, the level of illegal transactions dropped to 20 percent in 2016 and was “significantly less than that” in 2017.
Rogoff said that the regulations introduced by the government will lead to lower bitcoin prices, although he emphasized that it will take time to develop a global regulatory framework.
“It has to be a global regulation. Even if the U.S. cracks down on it, and China cracks down on it, even if Japan doesn’t, people will still be able to launder money through Japan,” he said.
Bitcoin traded around $11,242.61 during Asian morning trading on Tuesday, according to industry website CoinDesk. The price of the digital currency has fallen this year from a record high of more than $19,000 in December last year.
According to Rogoff, authorities have been passive about regulating bitcoin because of the anticipation of the technology behind the digital currency.
“They want to see the technology advance,” Rogoff said, adding that the private sector has historically “designed everything” from standard coins to paper money in the history of currency.
Bitcoin is a significant growth area, as is the application of blockchain technology, which allows transactions to be stored and recorded.
However, there have also been claims in the past that bitcoin is falling in price. Before bitcoin sold off last December, Rogoff said last October that estimates for the digital currency would “collapse” amid attempts by governments to regulate the space.