The economist is one of the world’s largest asset managers believes that the likelihood that the bitcoin exchange rate eventually reaches zero, is quite high.

Joe Davis, senior economist at Vanguard, under which is $5.1 trillion, wrote a column for the portal in which he said that although his company is optimistic about the blockchain, she doesn’t believe that cryptocurrency can be a viable application.

“I’m enthusiastic about blockchain technology, thanks to which it may be bitcoin. Indeed, Vanguard already uses such technology. As for bitcoin as a currency, I believe that with a significant probability, its rate will fall to zero,” writes Davis.

He also argues that bitcoin should not be taken as a form of money because, although it can serve as a unit of calculation, the cryptocurrency is not an effective means of accumulation. The analyst also drew attention to the fact that the current price of bitcoin is based solely on speculation and not on fundamental economic values.

“Crypto-currencies – weak investment. Unlike stocks and bonds, currencies do not cause cash flows such as interest payments or dividends, which explains their price. The price of national currencies is determined by their underlying economic activity producing countries. The price of cryptocurrencies, on the other hand, in General is not based on economic fundamentals. Currently their value is based mostly on speculation concerning their distribution and use in the future,” he writes.

Davis urges investors not to invest even a small percentage of their funds in bitcoin and other cryptocurrencies, as this will limit their access to “tried and true asset class”.

“As innovation accelerates and competition increases, most networks (and related cryptocurrencies) may lose its relevance and become more like the Tulip bulbs in the seventeenth century in the Netherlands, rising to unprecedented heights, before the speculative bubble will burst,” — he wrote. “And, unlike tulips, they are not very good will look in a vase”.

Last year a similar point of view on cryptocurrency was expressed by the founder of Vanguard Group John Bogle, who advised investors to “avoid bitcoin like the plague”, citing the fact that he has no “base yield”.

“We’ll talk when it will cost $100,” said Bogle.