Aswath Damodaran, a professor of finance at the NYU's Stern School of Business, has expressed his belief that bitcoin is a currency rather than an asset in a new blog post.
Often referred to as Wall Street's "Dean of Valuation," Damodaran asserted in the post: "I don't believe cryptocurrencies are now or ever will be an asset class," or that they will change the "fundamental truths of risk, investing and management."
"Bitcoin is not an asset, but a currency, and as such, you cannot value it or invest in it. You can only price it and trade it."
Grouping all investments into four categories, – assets, commodities, currencies and collectibles – the finance expert substantiated his statement by saying that bitcoin does not the "generate cash flows" required to be categorized as an asset, nor it is a "raw material" that would class it as a commodity.
"The choice then becomes whether it is a currency or a collectible," he said.
Notably, Damodaran further disagreed with JPMorgan Chase CEO Jamie Dimon's recent comment that bitcoin is a "fraud."
Back in July, Damodaran also argued that cryptocurrencies were quickly becoming a preferred alternative to gold for people who don't trust traditional fiat currencies.
Aswath Damodaran Image via YouTube