Could bitcoin ever become worthless?
Although Bitcoin is currently rushing from all-time high to all-time high, there are reminders that Bitcoin could also become worthless. Find out how that could happen and how likely it is in this article.
Bitcoin (BTC) never ceases to amaze onlookers. From a near-zero value, it has risen above $28,000 in just a few years. Moreover, it is the largest cryptocurrency in the world and is considered „digital gold“. A further price increase currently seems to be only a matter of time.
For a long time, however, there have also been opposing voices that predict that Bitcoin Billionaire will become worthless again or that it never had any value. What is the truth behind these prophecies of doom? Could Bitcoin really lose all its value again?
Economics professor Aleh Tsyvinski and his assistant Yukun Liu from the renowned U.S. university Yale looked into this question in 2018. In their scientific working paper, the researchers concluded that there is a 0 to 1.3% probability that Bitcoin will fall to zero within one day. At the time of the study, the probability was 0.4%.
Lack of tangible value of Bitcoin
Other voices claim that Bitcoin must fall to zero because it has no intrinsic value. However, they overlook the fact that the value of a thing is also determined by what value buyers ascribe to it. Right now, many people ascribe a high value to Bitcoin and, moreover, the number of coins is strictly limited. Just in the attribution of value, Bitcoin is like paper money – the piece of paper (the bill) is worthless in itself, but you can buy something with it because the general public attributes a value of, say, 50 euros to this piece of paper.
Ban on Bitcoin
Another possibility would be an international ban. However, such unity among states is hardly likely, since some countries use Bitcoin to circumvent economic sanctions, for example. In addition, Bitcoin is decentralized, so it would be tremendously difficult to remove the underlying infrastructure.
Counterfeiting the ledger
Finally, counterfeiting the ledger of Bitcoin could also lead to coins being issued multiple times. This would seal the end and worthlessness of Bitcoin. According to current knowledge, this would require at least a fully functional quantum computer, which is currently still years away.
There is some risk that Bitcoin will fall to a value of zero, but this risk is currently very low and is unlikely to outweigh the benefits of Bitcoin.