Nobel laureate Eugene Fama has expressed his skepticism about Bitcoin’s long-term survival, predicting that it has a close to 100% probability of becoming worthless within the next decade. Fama argues that Bitcoin’s extreme volatility, lack of intrinsic value, and violation of basic monetary principles make its long-term survival unlikely.
Fama, pioneer of the efficient market hypothesis, believes that cryptocurrencies like Bitcoin violate fundamental rules of a medium of exchange. They have highly variable real value, which is not supposed to survive as a stable currency. The fixed supply combined with fluctuating demand leads to price volatility, making it unsuitable for everyday use.
Fama’s skepticism extends beyond Bitcoin to blockchain technology, which he sees as energy-expensive and potentially unsustainable. He warns that there are always incentives for people to corrupt the blockchain, and if enough computing power is applied, they can bring it down.
Despite his overall skepticism, Fama acknowledges one potential use case: as a hedge for ultra-wealthy individuals facing political risk. However, this limited use case doesn’t change his assessment of Bitcoin’s future.
The debate over Bitcoin’s future highlights broader questions about the nature of value, the role of government in financial markets, and the potential for technological innovation to reshape our understanding of money. Fama’s prediction underscores the profound challenges that cryptocurrencies pose to traditional economic theory and practice.
Source: https://www.promarket.org/2025/01/30/nobel-laureate-eugene-fama-predicts-bitcoin-will-become-worthless