Renowned economist Nouriel Roubini has once again delivered a scathing critique of Bitcoin (BTC), questioning its decentralization and doubts about security and scalability.
Notably, Roubini has maintained a dismissive stance towards Bitcoin and the broader cryptocurrency space, often branding them as scams.
In a May 3 debate organized by financial news aggregator Zerohedge, where Bitcoin was pitted against gold, Roubini dismantled the foundational principles of the leading cryptocurrency.
Drawing on his reputation for accurately predicting the 2008 financial crisis, he argued that Bitcoin’s security and scalability promises are less fulfilled than those of traditional monetary systems.
Roubini underscored the vulnerability of Bitcoin holders, stressing the irreversible nature of transactions once private keys are compromised. Unlike traditional banking systems that offer recourse options in case of theft, he pointed out that the loss of private keys results in permanent loss of funds, painting a bleak picture of Bitcoin’s security landscape.
Questioning Bitcoin’s decentralization
Furthermore, Roubini challenged the concept of Bitcoin’s decentralization, dismissing it as “nonsense.” He highlighted the concentration of mining power among a few significant players, which, in his view, undermines any claim to decentralization.
“In the traditional financial system, there’s massive scalability. Yes, we have a centralized system. Bitcoin, first of all, is not secure. <…> It’s not even decentralized. <…> This idea of decentralized is nonsense. It’s neither decentralized, secure, nor scalable. It’s three NOs,” he said.
Roubini raised concerns about the dominance of mining operations, particularly in regions with tax regulatory oversight, which threatens the network’s integrity.
Alternative to traditional finance
In addition, he rejected Bitcoin as a viable alternative to traditional financial systems, citing its purported inefficiency in handling large transaction volumes.
The financial expert also likened storing Bitcoin to burying gold in the ground, describing it as a cumbersome and impractical solution in the digital age.
His sentiment comes amid his continued bashing of cryptocurrencies. The economist has termed crypto “totally corrupt” and the “biggest criminal heist in human history.”
The expert has also warned of a possible “crypto apocalypse” for the industry, mainly due to regulators cracking down on the sector.
