American economist and well-known cryptocurrency and blockchain critic Dr. Nouriel Roubini (aka “Dr. Doom”), who calls himself an expert in asset bubbles, explained in an interview (published on Wednesday, March 6th) with the CFA Institute why he still considers crypto to be “the mother and the father of all bubbles.” Professor Roubini “teaches at New York University’s Stern School of Business and is chairman of Roubini Macro Associates LLC, an economic consultancy firm.”

During 2018, Roubini called blockchain “a glorified Excel spreadsheet” and “one of the most overhyped technologies ever”. As for Bitcoin, as far back as 2014, he was attacking it, calling it “a Ponzi scheme”, a “lousy” store of value, and “a conduit for criminal/illegal activities”.

In May 2018, Alex Mashinsky, the founder of Celsius Network, told Roubini, who has never owned Bitcoin, during a heated exchange at a panel on cryptocurrencies at the Milken Institute Global Conference 2018, that he should “buy one coin and then tell us how it works.” Mashinsky also compared Roubini’s criticisms of Bitcoin to “a horse salesman saying we don’t need combustion engines.”

During the interview with the CFA Institute, Roubini was asked about his “strong views” on Bitcoin and other cryptocurrencies. Here are a few of his comments:

“…to me, the whole crypto space is one of assets that are not really money. They’re not really a currency. They’re not a scalable means of payment. They’re not as stable in terms of store of value.”

“And what happened, especially in 2017 when the price of bitcoin went from $2,000 all the way to $20,000 by the end of the year, to me had all the features of a bubble… And guess what? That bubble started to burst because there was no real fundamental value on these assets… This was to me the mother and the father of all bubbles.”

Roubini was then asked about the huge amount of feedback he receives from the crypto community on Twitter whenever he makes a crypto-related tweet. He replied:

“Well, I engage on Twitter and I also have attended many of these crypto or blockchain conferences. I met some of these individuals, and I must say I’ve never seen in my life people who on one side are so arrogant in their views, who are total zealots and fanatics about this new asset class, while at the same time completely and totally ignorant of basic economics, finance, money, banking, central banking, monetary policy.”

“They want to reinvent everything about money, but most of them are absolutely totally clueless… These are fanatics. Some of them, like criminals, zealots, scammers, carnival barkers, insiders who are just talking their book 24/7.”

Roubini had only one “positive” thing to say about cryptocurrencies:

“The saving grace of cryptocurrencies is that, unlike other bubbles that exploded and led to some sort of a systemic crisis, this asset class was relatively small. Unfortunately, lots of suckers lost their shirts, but it doesn’t have any systemic implications.”

When asked about what “capital market developments” he felt most excited about, Roubini, who says that he is a “technological optimist”, said that he believes that “one of the most positive things is that there is a technological revolution that will probably change the world.” With regard to “the future of financial services,” he said that it had “nothing to do with cryptocurrencies or so-called blockchain technology,” and went on to talk about Fintech:

“The real revolution in financial services is fintech, but fintech has nothing to do with crypto. Fintech is going be a combination of artificial intelligence and big data and the ubiquitous internet. It will revolutionize payment systems, credit allocation, capital market functions, insurance, investment management, financial advice, etc.”


Featured Image Credit: Photo by “tombark” via