Bitcoin, the world’s first cryptocurrency, is once again at the center of a heated debate. This debate was sparked by American economist Steve Hanke, who said on social media platform X (formerly Twitter) that Bitcoin has “zero fundamental value.” His comment came during a time when Bitcoin’s price was falling, which led many experts and cryptocurrency fans to respond strongly.
Over the past few weeks, Bitcoin’s price has been dropping, and on December 15, it fell to a two-week low near $85,100. Hanke, who is known for criticizing cryptocurrencies, called Bitcoin “a highly speculative asset with zero fundamental value” in one of his posts. Speculative means that the asset’s price depends a lot on people’s guesses about its future rather than its actual value.
Many people disagreed with him. One well-known crypto analyst, Axel Adler Jr., quickly responded and said Hanke’s opinion was “absolutely incorrect.” Adler believes Bitcoin is going through a correction—a temporary price adjustment after years of growth. He thinks Bitcoin is becoming an important part of the worldwide financial system. Another user named Carpe_Diem pointed out that fiat money—like the U.S. dollar—is also losing value. They shared a chart showing that the U.S. dollar has lost 86% of its purchasing power since 1972. Fiat money is paper money issued by governments that isn’t backed by a physical asset like gold, and it relies on people trusting it.
During the week of Bitcoin’s price drop, other issues started showing up. For example, Bitcoin’s hashrate—a measure of the computer power used to process transactions and maintain security—saw sharp daily decreases between December 9 and December 14. One theory is that these drops were caused by mining operations shutting down in China. Mining operations are what keep Bitcoin networks secure by solving complex problems. However, Adler said it’s hard to fully explain what caused the drop just from the data.
The price swings have highlighted the arguments on both sides of the debate. On December 15, Bitcoin’s price was down about 3.4% over a 24-hour period. This continues its underperformance compared to its late November highs around $100,000. Other cryptocurrencies also experienced losses. For example, Ethereum, another popular cryptocurrency, fell below $3,000. Cryptocurrencies like XRP, Solana, and Cardano also faced short-term price drops.
A separate report from CryptoPotato showed that around $210 million of leveraged positions were liquidated in just one hour during the sell-off. Leverage means people borrow money to trade, which can make their gains bigger but also worsen losses during price drops.
Supporters of Bitcoin argue that its market value challenges Hanke’s “zero value” claim. For example, Swan Bitcoin quoted analyst Checkmate, who mentioned that over $1 trillion has been invested in Bitcoin as a way to save money. Others say Bitcoin is valuable not just because of its price, but because of its ability to act as a global payment system that isn’t controlled by any one person or group.
However, people who doubt Bitcoin’s future have other concerns. Some analysts warn that the current financial situation, including delayed interest rate cuts in the U.S., could keep the pressure on high-risk investments like cryptocurrencies well into 2026. This means that Bitcoin’s price might go even lower before it starts recovering.
The disagreement between traditional economic theories and Bitcoin’s increasing involvement in markets doesn’t seem to be ending soon, especially whenever Bitcoin’s price takes big dives. Critics often use these moments to argue that Bitcoin doesn’t have real value.
This debate shows the ongoing struggle to understand Bitcoin and the role it might play in the future. The post originally appeared on CryptoPotato.