Stephen Roach, a Yale University Senior and former Morgan Stanley chairman and chief economist for Asia, said that “This is a toxic concept for investors.“
“I’ve never seen a chart of a security where the price really has a vertical pattern to it. And bitcoin is the most vertical of any pattern I’ve ever seen in my career,” he added.
Interest from retail and institutional investors have pushed the over 1,000% surge that Bitcoin has experienced this far into 2017. They see the digital currency as a future means of store of value and future means.
The inclusion of futures contracts into major exchanges like the CME and CBOE have also legitimed the currency‘s credentials – which will likely continue to pump up the price. Roach, however, feels that this legitimization is making bitcoin “somewhat dangerous“ for investors as it suffers from what he said is a “lack of intrinsic underlying economic value to the concept.”
Investors are not shy to admit that they don‘t understand the entirety of the technology behind the existence of the coin – taking merely a bandwagon approach in investing and expecting it to continue to rise.
“Like all bubbles, they burst,” Roach said.”They go down, and the one who’s made the last investment gets hurt the most, there’s no question about it.”