Nouriel Roubini Calls Most Crypto Hype, With Stablecoins as the Exception
The economist says ICOs and altcoins have mostly failed, but sees stablecoins as the only real use case. He also argues for tokens backed by real-world assets.
Key Takeaways
- Nouriel Roubini says most crypto projects are hype with no underlying value.
- According to him, 80% of roughly 20,000 ICOs were fraudulent from the start, and 70% of the rest eventually lost everything.
- Roubini sees stablecoins as the only legitimate crypto use case, especially as a digital payment method.
Nouriel Roubini, known as an economist and a skeptic of the crypto market, has once again taken aim at the state of crypto. In a podcast with BeInCrypto Expert Council, he said most crypto projects are nothing more than hype with no underlying value. According to him, nearly 20 years of development since Bitcoin has produced just one legitimate use case: stablecoins.
ICOs and Altcoins Have Mostly Failed
Roubini stressed that out of the roughly 20,000 Initial Coin Offerings (ICOs) ever launched, as many as 80% were fraudulent from the start. In his view, many projects are built entirely on belief and trust, with no real backing. Of the remaining projects, 70% eventually lost all their value. Even the biggest cryptocurrencies, including Bitcoin, are down 50% to 60% from their peaks. For example, Bitcoin briefly fell below $60,000 (€52,900) on June 24, more than 50% below its record of $126,080 (€111,200).
According to Roubini, these numbers show that almost everything built on the blockchain is a speculative bet with no real claim on assets or utility. The history of ICO fraud, with pump-and-dump schemes and projects that disappeared after raising money, backs up that view. That fits into the broader market weakness, where Bitcoin was also recently under pressure from outflows from U.S. spot ETFs and a stronger dollar.
Stablecoins as the Only Working Use Case
Despite his harsh view of most crypto projects, Roubini does recognize one exception: stablecoins. He calls these digital tokens crypto's only "killer app" after nearly two decades of Bitcoin. Stablecoins work as a digital version of fiat currency and offer a payment method that is especially useful in countries with high inflation. Still, he warns that they carry the same devaluation risks as traditional currencies and do not generate yield.
That nuance supports his push for tokenized real-world assets, where tokens are backed by verifiable, real underlying assets. In his view, that could be the next step in the evolution of blockchain technology.
Criticism of Centralization and Speculation
Roubini is known for his ongoing criticism of the crypto world, and he has previously said many projects are too centralized and simply copy traditional financial systems without adding much value. His latest comments reinforce his view that the crypto market is driven mostly by speculation and trust, not intrinsic value.
This analysis may matter for European crypto investors who want to weigh the risks of the crypto market, especially given the high number of failed projects and the role of stablecoins as a practical payment method in certain economic settings.
