Wharton professor issues gruesome warning on Bitcoin

Core Viewpoint - Bitcoin is emerging as a potential competitor to the U.S. dollar as the world's reserve currency, posing a significant threat according to Jeremy Siegel, a Wharton Business School professor and chief economist at WisdomTree [1][2]. Group 1: Bitcoin as a Threat to Traditional Currency - Siegel emphasizes that Bitcoin could rival not only the U.S. dollar but also the euro, indicating a shift in the landscape of reserve currencies [2]. - The GENIUS Act, which was enacted with bipartisan support, aims to establish a comprehensive regulatory framework for stablecoins, which Siegel believes could serve as important catalysts for the cryptocurrency industry [1][2]. Group 2: Global Financial Dynamics - Siegel notes that while there has been speculation about BRICS countries creating a rival financial system, he does not see them as a direct threat to the dollar [3][4]. - He highlights that the current global financial system has been stagnant, with international transfers being inefficient, and suggests that crypto-based systems could enhance efficiency in this area [4]. Group 3: Bitcoin's Role in the Economy - Bitcoin is increasingly viewed as "digital gold," serving as a hedge against inflation due to its limited supply of 21 million coins, which has remained unchanged for a decade [6][7]. - The cryptocurrency's performance during periods of aggressive central bank easing, such as the pandemic stimulus era, has led investors to consider it a viable store of value [7][9]. Group 4: Institutional Perspectives - Michael Sonnenshein from Grayscale points out that the significant fiscal stimulus injected into the economy has prompted investors to reevaluate what constitutes a store of value and an inflation hedge [9].