A well-known Russian economist commented on the bitcoin rally and announced the inevitable crash.
The historic rise of the first cryptocurrency in recent months was the result of the desire of many investors to keep their capital in a more reliable and promising, as they thought, the currency, said economist Mikhail Khazin.
Bitcoin is more reliable because it is not subject to any regulation and does not depend on central banks. This is what the economist sees as the fundamental difference between BTC and physical, writes "Economy Today".
"The circulation of physical gold is tightly controlled. People who keep their savings in gold for a rainy day buy bullion or coins. There are really problems with them. You can't buy gold without a passport. We have toughened regulations for dealing with cash," explained Khazin.
Khazin also attributes the rise of cryptocurrencies to stricter control of dollar financial flows, which prompted those wishing to hide money and switch from U.S. currency to new digital means of payment.
However, many use cryptocurrency for illegal operations involving illegal substances and weapons, so the economist believes that in the near future bitcoin will be "shut down.
Billionaire Mark Cuban is also skeptical of bitcoin. He recently said that the cryptosphere resembles the dot-com bubble of the early 2000s. At the same time, he admits that some digital currencies can indeed survive the crisis and enter a new era as innovative giants.
"Bond King" and head of management company DoubleLine Jeffrey Gundlach said that bitcoin has fallen into the bubble zone after crossing the $20,000 mark. Last year, the investor called bitcoin an insurance policy against inflation amid a weakening dollar. But after the cryptocurrency rose in price to about $23,000, he said, the "mania" began.