- Bitcoin’s legitimate use cases are in the minority and have continued to decline in the past three years, a Canadian economist has claimed.
- He labeled Bitcoin as a fraud, insisting that the majority of BTC use cases are to fund criminal activities.
Bitcoin is a fraud and is mainly used in criminal activities, one seasoned economist has pointed out. Peter Berezin, the chief global strategist at BCA Research believes that Bitcoin hasn’t changed a bit from its early days when it was just a criminal underground token. Moreover, it pales in comparison as an asset class to gold which according to him has real usage aside from speculation.
Berezin was speaking in an interview with Kitco News where discussed BTC, gold and meme stocks like GameStop and AMC. The Canadian is a revered leader in his field, having served as the senior global economist at Goldman Sachs prior to joining BCA. He has also worked with the International Monetary Fund.
It [Bitcoin] continues to do what it did back then. Back then, it had a lot of interest from criminal syndicates – people used it in places such as Silk Road and other parts of the dark web. If you look at transactions involving Bitcoin, to this day, the majority continue to be to finance all sorts of illicit activities.
Berezin is not alone in characterizing BTC as a criminal currency (this has been severally proven to be untrue). As CNF reported earlier today, European Central Bank board member Fabio Panetta also termed the top crypto as a criminal-enabling ‘dangerous animal.’
Read More: Only the digital euro can save the region from the dangerous animal that is Bitcoin: ECB executive
Berezin added, “But if you actually look at how much Bitcoin is used for legitimate business purposes, the answer is very little.”
The economist referred to data that he claimed to possess that reportedly reveals the share of legitimate business transactions happening now on Bitcoin is less than it was three years ago.
For Bitcoin, legitimate usage is not growing and I think that should be worrying for anyone that’s investing in this currency.
One of the reasons Bitcoin’s use as a currency has decreased is that it’s not well suited for simple transactions. It only processes 7 transactions a second, compared to Visa which does over 25,000. One transaction can take up to half an hour and the median fee this year has been $20, he observed.
Gold is better than Bitcoin as it has real use cases
After dismissing Bitcoin as a currency, Berezin then took on its narrative as an asset class.
If Bitcoin isn’t a unit of account, if it’s not a medium of exchange, then why exactly should it be a store of value? There’s no intrinsic value to Bitcoin.
According to him, BTC relies on the ‘greater fool theory,’ in which one buys it hoping to dump it on someone else at a higher price. However, as many in the crypto world have observed, this is the same model every other asset class relies on.
Bitcoin’s ultimate demise will come soon due to its energy consumption concerns.
If these concerns about the environment coupled with other concerns such as the fact that the whole ransomware industry wouldn’t exist without Bitcoin, if all that leads to increased scrutiny and regulation, then Bitcoin is just going to disappear.
Berezin then attacked the narrative that Bitcoin is the digital gold. Unlike Bitcoin, gold has actual use cases, he claimed.
Related: Bitcoin is 50 times better than gold -MicroStrategy CEO
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