Famed economist Steve Hanke has once again attacked Bitcoin, labeling it an asset with 'zero fundamental value' in a December 16 social media post. Hanke pointed to Bitcoin's recent price decline below $86,000 as evidence of its inherent volatility and lack of intrinsic worth. He argues that the sharp fluctuations are not accidental but a defining characteristic of the cryptocurrency.
Hanke's Longstanding Criticism of Bitcoin
As a professor of applied economics at Johns Hopkins University, Hanke has long been a vocal Bitcoin skeptic. He has repeatedly criticized El Salvador's decision to adopt Bitcoin as legal tender, calling it a 'disaster.' In his latest post, Hanke renewed his opposition to including Bitcoin in any national reserve, dismissing proposals for a U.S. Bitcoin reserve outright. 'Bitcoin has no intrinsic value and serves no practical economic function—it is purely a speculative tool,' he wrote.
Hanke's views are not isolated. Other economists, such as Nobel laureates Paul Krugman and Joseph Stiglitz, have also questioned Bitcoin's value proposition. However, supporters argue that Bitcoin's decentralized nature and fixed supply make it a viable store of value, akin to digital gold.
Bitcoin Price Action and Market Response
According to market data, Bitcoin hit an all-time high of $126,000 in October 2025 but has since entered a downtrend. On the day before Hanke's post, Bitcoin fell 4% in a single session, sliding from around $90,000 to below $86,000. This drop triggered panic among leveraged traders, leading to a cascade of forced liquidations. Over the past week, Bitcoin has lost more than 15% of its value, wiping out hundreds of billions in market capitalization.
Despite Hanke's criticism, some institutional investors are still accumulating. Data shows that Bitcoin outflows from major exchanges have increased, suggesting long-term holders may be buying the dip. Hanke, however, dismissed these moves as futile: 'Any attempt by governments or institutions to prop up Bitcoin prices is doomed to fail. The bubble will eventually burst.'
The Ongoing Debate Among Economists
The question of Bitcoin's 'fundamental value' remains a dividing line in economic circles. Hanke argues that an asset's value must derive from cash flows or real economic utility, which Bitcoin lacks. But proponents counter that value can come from consensus and scarcity, much like gold. With Bitcoin now more than 30% below its peak, the debate over its long-term viability has intensified. Hanke's comments add weight to the bearish narrative.
Meanwhile, the broader crypto market is also under pressure. Ethereum, Solana, and other major tokens have declined in sympathy, reflecting a broad market correction. Hanke predicts that unless Bitcoin finds genuine fundamental support, its price could fall further to $50,000 or even lower.