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https://dailyhodl.com/2018/08/15/founding-ceo-of-paypal-says-bitcoin-is-heading-to-zero-yale-study-says-chances-are-0-3/

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BITCOIN August 15, 2018 Daily Hodl Staff

Founding CEO of PayPal Says Bitcoin Is Heading to Zero, Yale Study Says Chances Are 0.3%

Despite the latest Bitcoin lashing from Bill Harris, former CEO of Intuit and PayPal, who claims cryptocurrency is “going to go a whole lot closer to zero”, Yale economist Aleh Tsyvinski and Yukun Liu, a Ph.D. candidate in the Department of Economics, argue that Bitcoin has a 0.3% chance of going to zero.
Their study is an unemotional take on the state of cryptocurrency and an analysis of market behavior. It lacks both corporate bias and crypto fanaticism.

“We’ve done something very simple. We said: Let’s use textbook finance tools to help us better understand cryptocurrency. We looked at three major cryptocurrencies: Bitcoin, Ripple, and Ethereum. We wanted to identify their basic properties. We examined whether they behaved like other asset classes, specifically stocks, traditional currencies, and precious metal commodities. We also gauged their potential for benefiting or disrupting various industries.” –  YaleNews

The researchers concluded that the probability, “in the view of the markets”, that Bitcoin falls to zero and becomes useless is 0.3%.


They also say that investors should diversify and buy Bitcoin, betting anywhere from 1% – 6% of their portfolios on the cryptocurrency.
Their strategy:
“If you as an investor believe that Bitcoin will perform as well as it has historically, then you should hold 6% of your portfolio in Bitcoin. If you believe that it will do half as well, you should hold 4%. In all other circumstances, if you think it will do much worse, then you should still hold 1%.”
Harris, founder of Personal Capital, a digital wealth management firm that provides financial software and services for traditional financial investments and portfolio management, condemned Bitcoin in a recent CNBC interview.
“The cult of bitcoin makes many claims: It’s instant, free, scalable, efficient, secure, globally accepted and useful – it is none of those things,” he said.
Harris also penned an article for Recode, calling Bitcoin “the greatest scam in history” and “a colossal pump-and-dump scheme, the likes of which the world has never seen.”
He made no mention of derivatives or sub-prime mortgage loans – investment banking and retail banking products that contributed to the colossal global financial collapse of 2008, or asset bubbles (i.e. student loan debt) or quantitative easing or trade deficits which many economists believe can set off another deep recession and/or economic collapse by 2020.