Nobel laureate Joseph Stiglitz demands bitcoin to be 'outlawed'

Despite the increasing interest in cryptocurrencies, many economic experts remain sceptic of them. A Nobel prize-winning economist has now demanded that bitcoin be “outlawed”.

Joseph Stiglitz who won the prize in 2001 said that he thinks digital currency illegal as it does not have a ‘socially useful function'. “Bitcoin is successful only because of its potential for circumvention, lack of oversight,” he added.

Stiglitz’s comments came on a day when bitcoin prices dropped around USD 2,000 in a span of 24 hours. The volatile day saw the exchange prices to reach a peak of USD 11,343 and then come crashing down to USD 9,088 before recovering later.

Also Read: Explainer: What is bitcoin and how does it work?

In the last eleven months, the value of bitcoin has seen a meteoric rise. At the beginning of the year, it was valued at nearly USD 1,000.

As the valuation has grown, the debate over if it is just a bubble waiting to be burst or it is the future of currency has become fiercer.

At one hand various reputed commercial institutions have started to trade in cryptocurrencies or have announced their willingness, on the other, central banks and economists like Stiglitz have sounded caution.

Also Read: 10 cryptocurrencies other than Bitcoin and Ether that have crossed $1 billion valuation in no time

“It’s a bubble that’s going to give a lot of people a lot of exciting times as it rides up and then goes down,” Stiglitz said during an interview with Bloomberg Television.

Arun Jaitley, Indian finance minister on Thursday clarified that India considers the cryptocurrencies as illegal. "Recommendations are being worked at. The government's position is clear, we don't recognise this as legal currency as of now," Jaitley said when asked whether the government has taken any decision on cryptocurrency.