Israel’s economics “tsar” AviSimhon has denounced Bitcoin (BTC) as intrinsically inefficient, predicting that the cryptocurrency can thus disappear.

A Top Market Group correspondent reported that Simhon — the top of the National Economic Council and senior policy advisor to the country’s prime minister — made his remarks at Israel Bitcoin Summit at Tel Aviv University on Jan. 8.

Simhon argued that to issue Bitcoin at a national or international scale would cost “trillions of dollars of actual value in energy,” as opposed to the prevailing state of affairs during which printing fiat money prices very little. This, he stated, is what prevents the invention from serving as a currency.

Noting that legislatures worldwide have debated whether or not to classify Bitcoin as an asset or currency, he argued that its inefficiency as a currency makes it categorically a speculative asset — because the Israeli tax authorities determined in Feb 2018.

While intensely sceptical regarding Bitcoin, Simhon however delved into the hypothesis that some kind of digital currency issuing might be acceptable to national governments.

He recommended that some governments could be willing to forfeit the profits they derive from virtually costless fiat currency issuing if the transition to digital currencies were deemed to be overall a lot of economical for the banking industry.

This call, he claimed, would be “made for sake of the bigger good,” stemming from states’ recognition of the generalized economic advantages that digital cash might bring.

“I am still quite confident that money as we all know it'll change,” he said — however made it clear that this shift to digital currencies wouldn't be due to the decentralized, anonymous peer-to-peer model of Bitcoin, however rather to a central-bank backed digital currency (CBDC).

Simhon noted that the Bank of Israel, the country’s central bank, had studied whether to pursue the issuing of digital shekels — Israel’s national fiat currency — and had decided against it. Conceding he was “not certain this was an honest call,” Simhon additionally claimed a decent argument for the central bank’s rejection was primarily that no different country has yet done so.

In this regard, the economic expert argued that, if successful, Switzerland’s extant digital currency pilots are a watershed for the potential transition and adoption of CBDCs worldwide.

Lastly, Simhon foretold that governments can stay staunchly against anonymous digital currencies, citing concerns over their implication within the potential financing of terrorism.

As reported last Nov, International fund (IMF) M.D Christine Lagarde has urged the international community to “consider” endorsing central bank-issued digital currencies, whereas remaining sceptical in reference to non-government-backed cryptocurrencies and assets.

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