Nassim Taleb the author of “Black Swan” has said that Bitcoin is worth exactly zero, and that there is no evidence that blockchain is a useful technology.
Taleb said this in a six-page document titled “Bitcoin, Currencies, and Bubbles,” which he promoted to his 743,000 Twitter followers.
Taleb who had in April called bitcoin an open Ponzi scheme, laid out four key arguments against the cryptocurrency in the new document.
He said that bitcoin failed to become a currency despite the hype around it and that it can neither be a short or long store of value. Contrary to the views of other analysts Taleb added that bitcoin is not a reliable hedge against inflation and that it is not a safe haven for investments.
“In its current version, in spite of the hype, Bitcoin failed to satisfy the notion of ‘currency without government.’
“The total failure of bitcoin in becoming a currency has been masked by the inflation of the currency value, generating (paper) profits for large enough a number of people to enter the discourse well ahead of its utility,” he said.
“Gold and other precious metals are largely maintenance-free, do not degrade over a historical horizon, and do not require maintenance to refresh their physical properties over time,” he said. “Cryptocurrencies require a sustained amount of interest in them.”
“[It] cannot operate as a reliable inflation hedge, and worst of all, does not constitute, not even remotely, a tail protection vehicle for catastrophic episodes,” he added.
Read also: ‘Sold almost all of my Bitcoin’, it isn’t going back up – Jim Cramer
“Not even remotely,” he said, citing the March 2020 market panic when bitcoin sank lower than the stock market, as well as the recent ransom payments following the Colonial Pipeline cyberattack, which authorities were able to track.
“Government structures and computational power will remain stronger than those of distributed operators who, while distrusting one another, can fall prey to simple hoaxes,” he added.
On blockchain technology Taleb said he sees a lack of utility of blockchain technology.
“There is no evidence that we are getting a great technology -unless ‘great technology’ doesn’t mean ‘useful.'”
He continued: “And we have done -at the time of writing -in spite of all the fanfare, still close to nothing with the blockchain.”
Ifunanya Ikueze is an Engineer, Safety Professional, Writer, Investor, Entrepreneur and Educator.
