JAKARTA In recent months, the price of Bitcoin has experienced a significant decline in its all-time high price (ATH) which was inscribed on November 10, 2021. At that time, BTC broke the price of IDR 984 million, based on Coingecko data.
Bitcoin declines have dragged down most of the prices of altcoins including Litecoin (LTC), Ethereum (ETH), Cardano (ADA), Dogecoin (DOGE) and others. The crypto community calls the current market's cryptowinter.
According to Nobel laureate economist in the field of Economics in 2013, Eugene Fama stated that he only saw one example where Bitcoin could have intrinsic value. Fama delivered this view in an interview with Kitco News.
The figure, who is often referred to as the 'father of modern finance', stated that Bitcoin can be valuable if used as a medium of exchange. On the other hand, he also assessed that the volatility of the world's largest crypto assets reduced its eligibility as a medium of exchange.
If people use it as a medium of exchange in other words, they actually make transactions in it then Bitcoin can have value because it's a type of money, it's an account unit. It's just a word that we can value because usually in transactions and supplies are limited so that in this case, it can have value, said Fama, quoted by Daily Hodl.
Furthermore, the economist questioned whether BTC was used as a transaction tool by the wider community because Bitcoin had unstable value.
The question is, will people transact in such media? It has volatile value. The monetary theory says that the account unit will not survive unless it has a fairly stable real value and the real price cannot go up and down dramatically. It's not Bitcoin. Bitcoin is everywhere," he added.
In addition, Fama also explained the worst possibility where the price of Bitcoin could be in free fall. Therefore, he warns the general public who invest in Bitcoin for joining in to be more careful.
People who say they invest in Bitcoin because of others, be careful... said Fama.
The economist reasoned that Bitcoin had fallen in recent months. He hopes that in the future the price of BTC will not fluctuate too much and can be more stable so that people are willing to transact it.
However, the 2013 Nobel laureate agreed to the view that Bitcoin is a store of value. However, this is a temporary phenomenon.
Long term, it can't be a store of value unless something gives it a value that not only people are willing to hold. It (Bitcoin) must have something in it that is intrinsically useful to get people willing to hold it for a very long time. If just because people think Bitcoin is a store of value, it will explode at a certain point, concluded Fama.
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