Harvard economist hints at a bitcoin drop. Kenneth Rogogg suggested that regulation would only cause a steep fall of the digital currency.
In 10 years, bitcoin could be worth $100, not $100,000. Harvard professor and economist Kenneth Rogoff has weighed in on the bitcoin debate. According to him, in a decade, it would be more rational to expect bitcoin to be worth $100 in a decade than to expect it to be $100,000.
Speaking to Squawkbox, he said “I think bitcoin will be worth a fraction of what it is now if we’re headed out 10 years from now … I would see $100 as being a lot more likely than $100,000 ten years from now.”
However, his was a grim forecast. “if you take away the possibility of money laundering and tax evasion, its actual uses as a transaction vehicle are very small.” There is no denying that bitcoin has played a role in the facilitation of dubious transactions. However, it would be tricky to put actual numbers on just how many of these transactions are bitcoin-financed.
Blockchain Intelligence Group co-founder and president, Shone Anstey, estimated a 20 percent drop in illegal bitcoin transactions in 2016. He added that 2017 saw an even lesser rate
Rogoff said that a key factor in the price drop would be government oversight. He was quick to add that it would take a while to take effect as it typical when developing a framework of regulation
To make sure regulation is effective, it would have to a global collective. “Even if the U.S. cracks down on it and China cracks down, but Japan doesn’t, people could still launder money through Japan,” Rogoff said. Currently, any regulations targeted at bitcoin are being implemented in individual countries.
Countries such as Japan legalized bitcoin in 2017. However, after the $530 million theft at Coindesk, its oversight authority, Japan Financial Service Agency put in place tighter regulations. Coindesk pledged to return 90 percent of the stolen currency. South Korea, for instance, allows cryptocurrency trading but only under the condition that trading is carried out from real name accounts.
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In December 2017, bitcoin was trading at a record $19,000. As recently as Tuesday, the trading price was around $11,242.61, a 16 percent drop. According to Rogoff, authorities are still keeping an eye open to see the technology behind bitcoin, hence the delay in regulation.
Blockchain technology is being backed by observers as a potentially disruptive technology, with bitcoin being one of its uses.Rogoff has come out in the past and predicted a collapse in bitcoin prices owing to government interference.