In the previous 24 hours, the worldwide global valuation of cryptocurrencies has plummeted to $1,24 trillion, down from $1,29 trillion on Wednesday, according to Coinmarketcap. Bitcoin dropped to over $29,000, a figure last witnessed around December 2020. According to certain sources, there seems zero guarantees that a further BTC pullback will not occur.
Ben Bernanke, the former chairman of the Federal Reserve, has issued a caution to Bitcoin (BTC) investors. Bernanke thinks Bitcoin has two existential threats from politicians and governments in a recent CNBC interview.
Bitcoin will not become an alternative form of money, says former Fed Chair Ben Bernanke
“One of the other risks that Bitcoin has is that it could, at some point, be subject to a lot more regulation. And anonymity is also at risk, I think, at some point. So investors in Bitcoin should be aware of that.”
Bitcoin and various cryptocurrencies, according to the former Fed chair, had underperformed in their intended aim.
“Bitcoin and other cryptocurrencies whose value changes minute to minute have been successful as speculative assets. And people are seeing the downside of that right now. But, they were intended to be a substitute for fiat money. And I think, in that respect, they have not succeeded.
Because if Bitcoin were a substitute for fiat money, you can use your Bitcoin to buy your groceries. Nobody buys groceries with Bitcoin because it is too expensive and too inconvenient to do that. Moreover, the price of groceries, the price of celery, varies radically day-to-day in terms of Bitcoin. So there is no stability either in the value of Bitcoin.”
Bitcoin seems doubtful to supplant fiat currencies as a source of cash, says Bernanke.
“I don’t think that Bitcoin is going to take over an alternate form of money. It will be around as long as people are believers and they want to speculate in it.”
Bitcoin is trading for $29,800 at the time of writing.