People have always doubted Bitcoin, but when a Nobel Prize-winning economist said it will eventually fail, many paid attention.

Eugene Fama, known as the “father of modern finance,” thinks that Bitcoin will eventually be worth nothing. What is his reason? Bitcoin has no true value, doesn’t work well for buying and selling, and doesn’t fit within regular banking systems. Does his case make sense?

Bitcoin’s Weaknesses: A Fatal Flaw Or Misunderstood Evolution?

Fama is mainly worried about how unpredictable Bitcoin is. For a currency to work well, it must be stable. Bitcoin changes in value a lot, making it hard for companies to accept it as payment. Fama believes that Bitcoin’s uncertainty makes it difficult to use as a way to buy and sell things.

He also argues that Bitcoin lacks the backing of a central authority. Unlike fiat currencies, which governments support, Bitcoin derives value purely from market speculation and demand. If the demand disappears, the price goes to zero. That’s his core thesis, but is it the whole story?

Nobel Laureate Eugene Fama Predicts Bitcoin Will Become Worthless https://t.co/smpQyoODmh via @ProMarket_org

— The Activist Investor (@activistinvestr) January 31, 2025

The Store Of Value Debate: Is Bitcoin Digital Gold?

Critics of Fama’s argument point out that Bitcoin isn’t just trying to be a currency—it’s evolving into something else. Many see it as digital gold, a store of value immune to inflation and government control. Unlike traditional currencies, Bitcoin has a fixed supply of 21 million coins, making it scarce and potentially deflationary.

NEW: “NOBEL LAUREATE” EUGENE FAMA PREDICTS BITCOIN WILL “GO TO $0 IN 10 YEARS”

What an idiot 🤡 pic.twitter.com/dVz4x4y2ol

— The Bitcoin Historian (@pete_rizzo_) January 30, 2025

In that sense, Bitcoin’s volatility could be a feature rather than a flaw. Gold isn’t used in everyday transactions, yet it holds immense value due to its scarcity and historical trust. If Bitcoin follows a similar trajectory, it may never be widely used for payments—but that doesn’t mean it’s worthless.

What Would It Take For Bitcoin To Go To Zero?

For Bitcoin to truly collapse, a few extreme scenarios would have to unfold. A worldwide ban could crush demand, making it difficult for investors to hold or trade. A technological failure—such as a catastrophic bug in the Bitcoin protocol—could undermine trust. Or a superior alternative could replace it.

But history suggests Bitcoin is resilient. It has survived multiple crashes, regulatory crackdowns, and criticisms from financial heavyweights. Each time, it has bounced back stronger. Could Fama be right in the long run? Possibly. But betting against Bitcoin has proven to be a losing game so far.

The Verdict: A Polarizing Future Ahead

Bitcoin’s future remains uncertain, and opinions are as divided as ever. While some believe it’s doomed, others see it as a revolutionary financial instrument. The reality? Bitcoin is still evolving, and its fate will depend on adoption, regulation, and market forces.

Featured image from City AM, chart from TradingView

Bitcoin has dropped below the $100,000 threshold as the broader crypto market experiences heightened volatility.

This downturn coincides with a significant decline in transaction activity on the Bitcoin network, bringing memory pool (mempool) volume to its lowest level since March 2024.

Market Downturn Wipes Out Over $500 Million in Liquidations

Over the past 24 hours, Bitcoin fell below $100,000, shedding over 4% of its value and briefly touching $98,000. Data from BeInCrypto indicates that Bitcoin initially peaked at $102,000 before succumbing to selling pressure.

The decline follows broader market instability, with the total crypto market cap losing 5% of its value. Other major cryptocurrencies also faced steep declines. Ethereum, Solana, and BNB each recorded losses exceeding 7%.

The increased volatility triggered a liquidation spree, wiping out over $555 million in leveraged positions, according to CoinGlass. More than 239,000 traders faced forced liquidations, with long traders—those betting on price increases—suffering the heaviest losses, amounting to $491 million.

Short traders, anticipating price declines, lost approximately $63 million.

The turmoil follows US President Donald Trump’s decision to enforce stringent tariffs on major trading partners, including Canada.

The administration claims the move is designed to curb the flow of undocumented immigrants and illicit substances into the US. However, the tariffs have sparked concerns about inflationary pressure on American consumers.

In response, Canadian Prime Minister Justin Trudeau announced retaliatory measures, imposing 25% tariffs on $106 billion worth of American imports.

The first round of levies, targeting $30 billion in goods, will take effect immediately, with an additional $125 billion in tariffs scheduled in the coming weeks.

Bitcoin Network Sees Sharp Drop in Transactions

Beyond market turbulence, Bitcoin’s network activity has declined significantly, with the mempool—the waiting area for unconfirmed transactions—showing a notable reduction in volume.

On February 1, data from CryptoQuant shows that the mempool is nearly empty, indicating a steep drop in transaction volume. The data further reflects that Bitcoin transaction fees have dropped to 1 sat/vB, signaling reduced demand for block space.

This marks the lowest level of transaction activity since March 2024.

This trend raises concerns about Bitcoin’s usage as a medium of exchange, with some analysts suggesting that the growing perception of BTC as digital gold may discourage transactional use.

Bart Mol, host of the Satoshi Radio Podcast, criticized the shift in narrative, stating that celebrating an empty mempool overlooks the potential risks to Bitcoin’s foundational role. He likened it to “wood rot” in a house’s foundation, warning that a lack of transaction activity could undermine Bitcoin’s core functionality.

“Bitcoiners celebrating that the mempool cleared is one of the most retarded things I’ve seen in a while. The digital gold narrative is slowly destroying the foundation of Bitcoin, like wood rot in the foundation of a house,” Mol wrote.

Indeed, Mol’s comment aligns with Bitcoin’s increasing adoption as a reserve asset. Several corporations and governments have begun considering Bitcoin for their treasuries. These narratives reinforce the token’s position as a long-term store of value rather than a transactional currency.

However, the ongoing decline in on-chain activity raises questions about Bitcoin’s long-term utility beyond being a digital gold reserve.

As the crypto bull run continues to stall, the Bitcoin (BTC) market remains in consolidation moving mostly between $101,000 – $106, 000 over the past two weeks.  Interestingly, a market analyst with X username cryptododo7 has shared a potential pathway for BTC to reestablish its bullish momentum. However, this theory includes an initial significant price dip.

The Trump Effect: Why Bitcoin May Need To Return To $76,000 

Based on his campaign promises, US President Donald Trump secured a substantial following in the digital asset space who yearned for a crypto-friendly administration.

Due to these expectations, Trump’s eventual victory as US President spurred Bitcoin to surge to $108,000 which was followed by a correction to below $90,000. Analyst cryptododo7 explains these movements were orchestrated by market makers who ensured BTC returned to $108,000 as Trump assumed office on January 20.

The analyst claimed these market makers utilized new market entrants who bought Bitcoin at high prices as exit liquidity. This market sale resulted in a fall in Bitcoin’s price as seen in both instances. With Bitcoin now stuck in a range-bound market, cryptododo7 states there is a need for the premier cryptocurrency to return to $76,000 in order to restart a new rally. 

This prediction is based on technical factors such as the double top formation and the short-term Wyckoff Distribution Scheme, both of which indicate BTC is due for a major decline. However, cryptododo7’s selection of $76,000 as a potential target stems from multiple reasons including the fact that this price level serves as a strong support and liquidity mop-up zone having been a region of strong buying interest.

Furthermore, a pullback to $76,000 would finally allow the Bitcoin market to absorb the excess demands of new market entrants who previously bought at high prices. In addition, this price correction will present institutional investors to actively accumulate BTC against the next rally. Cryptododo7 predicts the next bull rally will definitely occur provided Bitcoin retests to $76,000 and finds sufficient support at this price level. 

BTC Price Overview 

At the time of writing, BTC trades at $99,659 after a 2.74% decline in the past day. Meanwhile, the asset’s daily trading volume has plummeted by 31.29% suggesting a significant decline in traders’ interest.

To make any significant uptrend, Bitcoin faces a major resistance at $106,0000, moving past which may push the asset to new price regions. With a market cap of $1.99 trillion, BTC remains the most valuable cryptocurrency boasting a market dominance of 58.6%.

Featured image from Unsplash, chart from Tradingview