The technology of cryptocurrencies will thrive, but the price of bitcoin will collapse under pressure from the state, writes Kenneth Rogoff.
CAMBRIDGE, Mass. (Project Syndicate) — Is the cryptocurrency bitcoin the biggest bubble in the world today, or a great investment bet on the cutting edge of new-age financial technology? My best guess is that in the long run, the technology will thrive, but that the price of bitcoin will collapse.
If you haven’t been following the bitcoin BTCUSD, +10.70% story, its price is up 600% over the past 12 months, and 1,600% in the past 24 months. At over $4,200 (as of Oct. 5), a single unit of the virtual currency is now worth more than three times an ounce of gold. Some bitcoin evangelists see it going far higher in the next few years.