Nobel laureate Robert Shiller is fairly confident bitcoin will collapse, but he’s not quite sure when that collapse will occur.
Shiller, a Yale University professor who won the Nobel Prize for Economics in 2013, told CNBC that bitcoin will likely “totally collapse and be forgotten,” although it could linger for as long as 100 years.
“It reminds me of the Tulip mania in Holland in the 1640s, and so the question is did that collapse? We still pay for tulips even now and sometimes they get expensive. (Bitcoin) might totally collapse and be forgotten and I think that’s a good likely outcome but it could linger on for a good long time, it could be here in 100 years,” Shiller said.
Citing a well-worn comparison to the so-called “tulip bubble,” Shiller said that bitcoin has no value outside of the “common consensus that it has value,” which makes it different from gold and other commodities.
“It has no value at all unless there is some common consensus that it has value. Other things like gold would at least have some value if people didn’t see it as an investment,” he said, adding that he “doesn’t know what to make of bitcoin ultimately.”
This is not the first time that Shiller has given bitcoin a bearish forecast. In 2014, he called bitcoin an “amazing example of a bubble,” adding that currency-wise it is a return “to the dark ages.” Last month, he opined that bitcoin’s mythology would be a “wonderful story — if only it were true” and predicted that although it may not immediately crash to zero, it will definitely “come down” considerably.
Nor is Shiller the first Nobel winner to throw cold water on the lunar aspirations of bitcoin investors. Joseph Stiglitz, who won the award in 2001, has argued that cryptocurrency “ought to be outlawed” because — in his view — it “doesn’t serve any socially useful function.”