Aswath Damodaran’s Changing Views on Bitcoin
In a recent statement, Aswath Damodaran, a professor of finance at NYU, has once again changed his opinion on bitcoin. Previously labeling it as “millennial gold,” he now refers to it as “the currency that nobody uses.” Here are the key points to note about his current stance:
1. Bitcoin’s Lack of Usage: Damodaran views bitcoin as a currency that has failed to gain widespread adoption. He sees it as a collectible that behaves differently from traditional collectibles.
2. Inflation Hedge Doubts: The professor opposes the idea that bitcoin can act as a hedge against inflation. He argues that its price movements are highly correlated with the stock market, contradicting the behavior of a typical collectible.
3. Volatility Concerns: Damodaran previously stated that bitcoin could become globally accepted if its volatility decreased. However, he now highlights its volatility as a negative aspect and a barrier to its adoption.
4. Skepticism Towards Bitcoin’s Future: While Damodaran’s views on bitcoin have changed over time, his current stance suggests skepticism about its potential and current status as a currency.
5. Professor Damodaran’s Reputation: As “the Dean of Valuation,” Damodaran’s opinions carry weight and influence within the finance community, making his changing views on bitcoin noteworthy.
Hot Take: Damodaran’s Shifting Opinion Highlights Bitcoin’s Uncertain Future
Aswath Damodaran’s varying views on bitcoin reflect the ongoing debate and uncertainty surrounding the cryptocurrency. While his previous endorsement as “millennial gold” sparked optimism, his current description of bitcoin as a currency with no usage raises valid concerns. This highlights the challenges that bitcoin faces in gaining wider acceptance and overcoming its volatility. Damodaran’s influential position and reputation add weight to his skepticism, making it essential for crypto enthusiasts to consider multiple perspectives when forming their own opinions on the future of bitcoin.
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