In December, when the peer-to-peer decentralized virtual currency bitcoin was reaching all-time highs, some economists (Professor Bitcorn) who lacked the capacity to make predictions or even describe what the cryptocurrency was, called for the utter demise of bitcoin and foresaw a collapse in the price.
Well, six months into 2014, and bitcoin is climbing yet again and has surpassed the $600 mark. Whatever the case, one economist is still standing by his projection and argues that time will vindicate his previous statements.
One of these economists is Mark T. Williams, an economist and Boston University finance professor, who said in December that bitcoin would decline to $10 in the first half of 2014 because it isn’t a viable medium of exchange and its proponents maintain a paucity of economic knowledge.
“Steep in Libertarian and anti-Fed dogma but weak in understanding of how global economics, central banking policies and financial markets function,” said Williams to Business Insider. “To assume currency can be computer generated, run in a decentralized manner and outside of the central banking system and controls is farcical and economically dangerous.”
In a new interview with CoinDesk, Williams defended his prior predictions by noting that “asset bubbles cannot be easily timed.”
He added to the bitcoin news publication: “Will this bubble be completely deflated in the next six months to a year? Time will tell. In January 2013 it was worth only $13. If the question is, ‘Do I still see bitcoin dropping to these much lower levels in the future?’ The answer is yes.”
In the long-term, Williams presented the case that his prediction will be more correct than others before him, such as the Winklevoss twins, who had called for bitcoin to increase to a substantial $40,000 per coin. He feels that bitcoin is still in a bubble and “grossly over-inflated” because of “concentrated ownership, artificially limited supply and overhyped demand.”
Williams noted that there have been many investors who bought in at $1,200 and have accrued significant market losses, which is usually omitted when discussing the price of the digital currency. Williams does not stand alone in the realm of economists.
