REUTERS/Fred Prouser
- Nouriel Roubini, known as “Dr. Doom” for his bearish views, slammed Bitcoin for being heavily manipulated and blamed retail investor FOMO for this week’s boom and bust on Twitter on Thursday.
- Roubini tweeted the digital token has no role to play in the portfolios of retail or institutional investors because it has zero intrinsic value.
- “Retail suckers with massive FOMO have been jumping again into BTC as they did in late 2017 when price went from 10K to 19K only to crash down to 3K in 2019,” he said.
- According to him, investing in Bitcoin is the same as gambling at a rigged casino.
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Nouriel Roubini, an economist nicknamed “Dr Doom” for his pessimistic predictions, trashed the world’s most popular digital currency for being heavily manipulated in a series of tweets on Thanksgiving Day.
Bitcoin has risen 167% this year, hitting a record of $19,293 this week. But its price tumbled by more than $3,000 after large volume crypto investors cashed in on their holdings.
While crypto bulls have largely talked up its potential as a safe-haven asset, Roubini argued that it has “no role” to play in institutional or retail investor portfolios because it isn’t a currency, unit of account, or a scalable means of payment.
“Retail suckers with massive FOMO have been jumping again into BTC as they did in late 2017 when price went from 10K to 19K only to crash down to 3K in 2019. Only winners were the manipulative whales that dumped their BTC to the retail suckers & led to its 85% price fall,” he went on.
Compared to stocks, bonds, real estate, and other income-generating assets, he said there’s no intrinsic value to be found in Bitcoin.
Roubini said crypto exchanges were also riddled with questionable trading practices, such as “pump and dump” – where traders over-inflate the value of a security the hold in order to aggressively sell it later – and inputting fake trades or prices.
In addition to high volatility – often at the hands of a very small number of traders – the cryptocurrency market has been plagued with scandal. Major exchange Bitfinex was accused of draining client money to cover almost a billion dollars in missing cash last year, while top executives at rival platform BitMEX were charged with breaking anti-money laundering rules.
Continuing his scathing attack against the digital token, he said: “It has no intrinsic value, it is not backed by any asset, it is not legal tender, it cannot be used to pay taxes.” He also raised an environmental argument against the power of POS, or proof of stake, that comes with being able to mine more bitcoins because it consumes immense amounts energy.
Roubini said Bitcoin is not an inflationary hedge because every time stocks go down, the digital asset falls much more.
@Nouriel/Twitter
He also equated investing in Bitcoin with gambling at a rigged casino. “At least in legit Las Vegas casinos, odds aren’t stacked against you, as those gambling markets aren’t manipulated the way BTC is,” he tweeted.
He concluded his 12-tweet-thread by saying “stay away from the cesspool of 1000s of worthless sh*tcoins.”