Bitcoin may not last long – it could fade away in the near future, says Eswar Prasad, a senior professor at Cornell University. This warning comes as the world’s most popular cryptocurrency struggles to make gains in a week of all-lows. Bitcoin, at the time of writing, stands at $46,470 – down by 1.20% in the last 24 hours.
Prasad points out that Bitcoin, compared to the new cryptocurrencies, is not much efficient with blockchain technology. He explained it uses an authentication process for transactions which is detrimental to the environment.
The professor, who has written the book The Future of Money: How the Digital Revolution is Transforming Currencies and Finance, believes bitcoin needs to transform. Prasad said bitcoin is not a medium of exchange and it’s not going to have a fundamental value either. He highlighted that to tackle the growing interest in cryptocurrencies, central banks across the world have started to issue their own CBDCs.
Prasad says the CBDCs could prove to be fruitful for economies. It can provide low-cost payment options which everyone would have access to. This could increase financial inclusion and boost financial stability as well. According to the Bank of International Settlements, CBDCs can enhance payments inclusion and efficiency, generate healthy competition, enhance data privacy and boost the integrity of the payment system.
However, the expert acknowledged that bitcoin indeed kick-started a revolution. Prasad said this revolution could, directly and indirectly, be of benefit. It cannot be denied that bitcoin continues to gain popularity and is regarded as an asset like gold is. And despite its high volatility, investments continue. Bitcoin has managed to make it into the 2020-decade and continues to be bullish.