Bitcoin’s price has been extremely unpredictable in recent years, with the price of a bitcoin falling from roughly $58,000 to less than $48,000 in the last month.
Bitcoin’s future is unknown, but one professor has warned that the world’s most popular cryptocurrency may be phased out in the near future.
“Bitcoin itself may not endure that much longer,” said Eswar Prasad, a senior professor of international trade policy at Cornell University, on CNBC’s “Squawk Box Europe” earlier this month.
Bitcoin’s price has been extremely unpredictable in recent years, with one coin falling from roughly $58,000 to less than $46,000 in the previous month. The price of a bitcoin was $45,637 at 10:15 a.m. ET on Friday.
While there were once only a few cryptocurrencies, there are now hundreds, with some being more useful and ecologically friendly than bitcoin.
Most cryptocurrencies are built on blockchain technology.
It’s simply a global network of computers that maintains a digital ledger of virtual currency transactions.
“Bitcoin’s implementation of blockchain technology is inefficient,” according to Prasad, author of “The Future of Money: How the Digital Revolution is Transforming Currencies and Finance.”
He explained that the cryptocurrency “uses an environmentally harmful validation technique for transactions” and “doesn’t scale up very well.” Bitcoin has a carbon footprint that is larger than the entire country of New Zealand.
According to Prasad, several of the newer cryptocurrencies make better use of blockchain technology than bitcoin.
He believes that blockchain technology would “fundamentally disrupt” the way finance is done as well as how we conduct everyday transactions like buying a house or a car.
“Given that bitcoin isn’t working as a medium of trade,” Prasad said, “I don’t think it’ll have any intrinsic worth other than whatever investor faith leads it to have.”
Cryptocurrencies, in general, have “put a fire under central banks to consider creating digital copies of their own currencies,” according to Prasad.
He went on to say that digital currencies could be good because they could give a low-cost payment alternative that anybody can use, thereby enhancing financial inclusion and possibly financial stability.
“As much as you may dislike bitcoin, it has sparked a revolution that, in the end, may benefit all of us, directly or indirectly,” Prasad added.
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