Raghuram Rajan, the former Governor of Reserve Bank of India and a well-known economist mentioned that the largest cryptocurrency by market cap, Bitcoin will function in conjunction with state-issued virtual currencies as a store of value.
As per CNBC, Raghuram Rajan, who is also the former chief economist of the International Monetary Fund, mentioned that he sees Bitcoin and CBDCs working along with each other.
Rajan, presently working as a finance professor at the University of Chicago, is known for forecasting the 2008 recession in 2007 and leading the economic recovery of one of the fastest growing economies in the world, India, in the past decade. Notably, Rajan’s long-term viewpoint for Bitcoin is rather optimistic. Nonetheless, he does not see BTC as a replacement of fiat currencies.
Rajan said,
“Bitcoin is a little bit like gold. In fact, gold has some value because we value it for jewellery, but Bitcoin you can’t even do that. Nevertheless, it has value because others think it has value.”
Rajan further mentioned that private crypto assets like Facebook’s Libra, a stablecoin presently under development and buoyed by several fiat currencies, will work as a medium of transaction as opposed to volatile assets including Bitcoin and other cryptocurrencies.
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