Forbes Magazine’s Editor-in-Chief Steve Forbes slams Bitcoin’s fixed supply limit. He claims that this characteristic of the cryptocurrency holds it back in meeting the needs of a growing economy.
In an editorial he wrote for Forbes on January 15, he mentioned that Bitcoin does not have the ability to replace the US dollar because of its high volatility. Criticizing the jump of Bitcoin’s value, he claims it is too unpredictable to be used as actual money.
‘The supply of money must expand to meet the needs of a growing economy. But the maximum amount of Bitcoin that can be “mined” is fixed’, Forbes argued in his editorial.
To further explain his point, he aired his grievances in a segment of the ‘What’s Ahead’ podcast released alongside the article. He described Bitcoin’s volatility as ‘a steak one day, dog food the next, and caviar the day after’.
In addition, he said that for Bitcoin to flourish in an economy, it should be able to expand to its needs. Fiat money is used to buy products and services that fuels the economy. Therefore, if Bitcoin can’t be used in the same way, the digital asset doesn’t have any purpose yet.
Moreover, he used contracts and mortgages as an example to drive his point. Forbes indicated contracts drive the economy forward so if Bitcoin can’t be used to sign long term contracts, it can’t replace the dollar yet.
‘Say you took out a mortgage in March for fifty thousand dollars, today you owe the bank almost 2 million dollars,’ he laments in his podcast.
Frustration over government currencies
‘Not so fast! Whatever bitcoin is, it is not money,’ Forbes said to criticise the people who place a high value on the cryptocurrency. However, he acknowledges that Bitcoin is now seen as a respectable investment class because of the rising disappointment on government currencies.
A few of the reasons he pointed out that contributed to people’s lack of faith in government currencies are crushed interest rates and banks printing unimaginable amounts of money to aid in COVID-19 efforts and stimulate the damage it has done to the economy.
Even though he acknowledges that Bitcoin can seriously challenge the dollar and other fiat currencies when it rivals the value of gold or the Swiss Franc, he still stands by his beliefs. In his opinion, cryptocurrencies without fixed value and a stable supply cannot grow along with a growing economy.
Bitcoin predicted to rise up to $146,000
On January 15, the value of Bitcoin hovered at around $36,000, stunning Wall Street at its remarkable ascent past $30,000. According to the predictions of JPMorgan Chase & Co, the cryptocurrency can even surpass $146,000 in the long run.
Even though crypto users and high-stakes investors are eyeing the steady growth of Bitcoin projected to reach the $40,000 mark, the cryptocurrency is still highly volatile. Just this week, Bitcoin dropped as much as 17%, a record-breaking slide since March 2020.