[Bitcoin Now] Surpasses 55 Million Won... Skepticism Also Arises

Questions Raised About Effectiveness... Companies May Enter Less Than Expected

On the morning of the 17th, the Bitcoin price is displayed on the Upbit Lounge cryptocurrency exchange price board in Gangnam-gu, Seoul. [Image source=Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin has surpassed 55 million KRW, continuing its upward trend day after day. Along with this, questions about its utility have been raised, citing that the price is set too high. A survey also revealed that fewer companies than expected will enter the cryptocurrency market.

According to the domestic cryptocurrency exchange Upbit, as of 11 a.m. on the 17th, Bitcoin recorded 54,901,000 KRW, up about 0.3% from the previous day. It also hit a new high of 55,500,000 KRW at 9:33 p.m. the previous day.

With a surge of about 72% compared to the beginning of the year, skepticism has emerged in some quarters. According to the Wall Street Journal (WSJ) on the 16th (local time), Nouriel Roubini, a New York University professor nicknamed 'Dr. Doom,' warned, "Many people are buying Bitcoin at absurd prices," adding, "Investors will incur losses and will never return to those prices." He further stated, "Most commodities like gold have utility, but Bitcoin cannot actually be used," and "It does not provide stable income like bond or stock dividends."

Roubini has doubted Bitcoin's utility for some time. On January 7 (local time), he tweeted that "the Bitcoin bubble will burst on January 15," but Bitcoin did not plunge. However, he did not change his stance and continued to argue that buying Bitcoin is nothing but speculation. According to the U.S. economic media Business Insider on the 10th (local time), he said, "If an appropriate carbon tax rate is applied to Bitcoin, it is virtually negative," and "The bubble is growing due to speculation by individual investors afraid of missing out."

Gabriel Makhlouf, Governor of the Central Bank of Ireland, also expressed doubts. According to Bloomberg on the 15th (local time), Governor Makhlouf said at a webinar held in Dublin that day, "Some may think Bitcoin is an investment, but it is similar to the tulip mania 300 years ago (a speculative bubble in 17th century Netherlands)."

A survey also showed that fewer companies than expected will enter the cryptocurrency market. On the 16th (local time), Bloomberg cited a survey by U.S. market research firm Gartner, reporting that U.S. corporate financial officers are not considering Bitcoin investment. According to Gartner, 84% of the 77 financial officers surveyed said they have no plans to hold cryptocurrencies as corporate assets. Only 5% said they had plans. Reasons for not including Bitcoin as a corporate asset included volatility, regulatory issues, and hacking risks.