Grantham’s Critique of Bitcoin
Jeremy Grantham, who co-founded GMO, has expressed strong skepticism toward Bitcoin, labeling it as a “useless speculative mechanism” and predicting its decline in the coming decades. He draws parallels to his past critiques of both the dot-com bubble and the 2008 housing market collapse.
His critique centers on three key failures he perceives in cryptocurrencies. First, he points out that Bitcoin doesn’t generate any yield. Secondly, it lacks a stable value. Finally, he believes it cannot serve as a functional currency for everyday transactions.
Proof of Work: A Flawed Model
Grantham particularly targets Bitcoin’s proof-of-work design, arguing that the immense energy used to verify transactions brings no real economic advantages to society.
“Evidence of unnecessary labor should not be worth a bucket of saliva, and it is not.”
Bitcoin as Currency and Store of Value
Beyond the mining issues, he emphasizes that Bitcoin fails as a practical currency. Everyday users aren’t using it in stores, and significant investors tend not to rely on it for large transactions. Without a useful transaction layer, he suggests, assets like Bitcoin cannot gain any financial credibility.
He also dismisses the idea of Bitcoin as a store of value. Unlike traditional stocks, which might pay dividends or generate cash flow, he feels Bitcoin offers no such benefits, leaving speculators without a solid basis for pricing.
A Skeptic with a Proven Track Record
Grantham’s viewpoints carry weight due to his history. He foresaw the dot-com bubble in the late 1990s and warned of the housing market collapse before it happened in 2008. Now, he extends similar judgments to current U.S. stocks, suggesting they might be primed for a drop of as much as 70%.
However, it’s worth noting that his timing hasn’t always been on point. For instance, his forecasts about a major 2021 stock market bubble turned out a bit premature as the market continued to rise ahead of a correction in 2022.
Currently, Bitcoin is valued around $60,500, marking a considerable decline from its peak of over $126,000 in late 2025. Additionally, the U.S. Spot Bitcoin ETF has seen $6.35 billion in outflows recently, indicating a waning interest from institutional investors.
Interestingly, the CEO of Coinbase has noted that the growing costs of AI infrastructure might influence the flow of crypto assets moving forward.
Grantham’s skepticism isn’t isolated; other figures in the financial realm, like Peter Schiff, echo similar concerns, insisting that Bitcoin holds no inherent value.
The critical question remains whether Bitcoin’s current price can find solid support as we approach the third quarter of 2026. Grantham forecasts a gradual decline, suggesting it won’t happen instantly but rather unfold over years or even decades.
