‘Bitcoin has no practical use’: Jeremy Grantham says the crypto will ‘fade into irrelevance’ as it slips below $60,000

Bitcoin’s No Practical Use: Grantham Predicts Irrelevance Below $60K

Theindiapostdaily.com – Bitcoin has no practical use, according to veteran investor Jeremy Grantham, who warns that the cryptocurrency will soon ‘fade into irrelevance’ as its value dips below $60,000. The co-founder of GMO, a well-known investment firm, recently expressed his doubts during an appearance on CNBC’s Squawk Box, highlighting Bitcoin’s lack of foundational utility. Grantham argues that while the crypto market has seen a surge in speculation, its long-term survival depends on tangible applications that justify its price.

Grantham’s Bold Assessment of Bitcoin’s Utility

Grantham’s criticism stems from his belief that Bitcoin’s primary role is speculative rather than functional. He pointed out that the cryptocurrency has failed to demonstrate consistent value retention, even amid a strong bull market. ‘Bitcoin is not a stable form of value,’ he said, emphasizing its volatility. The recent halving event, which typically boosts price, was met with a sharp decline, underscoring his view that the asset lacks predictable fundamentals.

‘Over years and decades, it will dwindle away, I suspect — not with a bang, but a whimper,’ Grantham remarked. ‘It’s not a stable form of value — it just halved for no particular reason in a strong economy, so you can’t depend on it in that way.’

This sentiment reflects Grantham’s broader perspective on Bitcoin’s trajectory. He contends that the crypto’s absence of real-world use cases, such as widespread adoption in everyday commerce or cross-border transactions, makes it vulnerable to market corrections and investor disinterest.

Bitcoin’s Market Downturn and Investor Behavior

As of 26 June, Bitcoin’s price had fallen to $59,934.04, a 2.66% drop from the previous day, signaling a broader decline in the cryptocurrency market. This decline coincided with a 2.75% reduction in Bitcoin’s market capitalization to $1.2 trillion, though trading volume saw a modest 3.09% increase, according to CoinMarketCap. The market’s contraction also extended to other digital assets, with the total crypto market cap hitting its lowest point since May.

Grantham’s concerns align with growing skepticism among investors. The U.S. Federal Reserve’s inflation data for May reignited fears of rate hikes, prompting a shift in capital toward more traditional assets. Additionally, the rise of AI-driven technologies and the performance of tech stocks have diverted attention and funds from the crypto sector. This trend suggests that Bitcoin’s appeal may be waning as investors seek more reliable returns in established markets.

Broader Implications for the Cryptocurrency Sector

Grantham’s comments have sparked discussions about Bitcoin’s future role in the financial ecosystem. While some investors see it as a hedge against inflation, others argue that its lack of practical use makes it a poor long-term investment. The cryptocurrency’s dominance in the market, which stood at 58.2% on 26 June, has been challenged by Ethereum and other coins, with Ethereum capturing 9.1% and the rest of the market accounting for 32.7%.

Analysts suggest that Bitcoin’s decline could accelerate if it fails to address its shortcomings. The crypto’s energy consumption, scalability issues, and reliance on speculative demand have been long-standing criticisms. For instance, the 2022 market crash, driven by liquidity concerns and macroeconomic factors, demonstrated how Bitcoin can lose value rapidly without underlying economic support. Grantham’s forecast echoes these concerns, predicting that the crypto will eventually be viewed as a relic of the past.

Expert Perspectives and Market Reactions

Other financial experts have echoed Grantham’s sentiments. Piyush Walke, a derivatives research analyst at Delta Exchange, noted that Bitcoin’s underperformance is tied to the Federal Reserve’s hawkish stance and rising inflation expectations. Meanwhile, Nischal Shetty, founder of WazirX, highlighted that profit-taking in assets like Bitcoin has intensified as investors reassess risk exposure. These observations reinforce the idea that Bitcoin’s survival hinges on its ability to evolve beyond mere speculation.

Despite the pessimism, some argue that Bitcoin’s journey is just beginning. Its role as a store of value, similar to gold, has attracted a dedicated following. However, Grantham’s view challenges this narrative, emphasizing that practical use cases are essential for long-term viability. As the crypto market continues to face scrutiny, the debate over Bitcoin’s utility will likely shape its future relevance in the global financial landscape.

With Bitcoin’s price now below $60,000, the question of its practical use remains central to its credibility. Grantham’s forecast underscores the need for innovation and real-world integration to sustain its value. While the cryptocurrency has captured the imagination of investors, its ability to transition from speculative hype to functional utility will determine whether it fades into irrelevance or solidifies its place as a cornerstone of the digital economy.