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As Bitcoin (BTC) continues its historic rally, nearing $123,000 earlier this week, not all voices in the financial world are cheering. Renowned economist Steve Hanke has once again issued a scathing critique of corporate strategies that include Bitcoin treasuries, warning investors that BTC has “no fundamental value.”
His comments come at a time when companies like Strategy (formerly MicroStrategy) continue adding billions of dollars in BTC to their balance sheets, sparking debates over the long-term viability of such investment approaches.
Steve Hanke: BTC Treasuries Are “Playing Roulette”
On July 14, Hanke took to social media platform X (formerly Twitter) to express his concerns. The Johns Hopkins University professor of applied economics argued that companies converting capital reserves into Bitcoin are essentially gambling with shareholder value.
“Companies swapping productive investments for Bitcoin ‘treasuries’ are playing roulette,” he wrote. “Bitcoin and Ethereum treasuries have no business model because BTC has no fundamental value.”
This isn’t the first time Hanke has voiced skepticism about crypto assets. A long-time critic, he has frequently described Bitcoin as speculative, likening it to “fool’s gold” and “intrinsically worthless.”
Aligning With Peter Schiff on Crypto Criticism
Hanke’s comments came shortly after Peter Schiff, another well-known gold advocate and economist, posted his own warning about Bitcoin-centric companies. On July 10, Schiff argued that crypto treasury strategies are based on a flawed logic: convincing investors to buy shares in companies that hold volatile digital assets rather than produce real-world value.
“The logic behind Bitcoin or Ethereum treasury companies is to take advantage of foolish investors… The problem is the fools looking to take advantage of other fools are fools themselves,” Schiff posted.
Hanke responded in support, stating that Schiff is “spot on,” further reinforcing a narrative among traditional economists that crypto enthusiasm is disconnected from financial fundamentals.
Criticism of Crypto-Backed Lending and Collateralization
Hanke didn’t stop at criticizing Bitcoin as an investment. He also questioned the sustainability of crypto lending, warning that the system may be on borrowed time.
“Eventually no one will loan against crypto collateral,” he cautioned. “But right now there are foolish lenders who will.”
This warning targets the growing ecosystem of crypto lending platforms and DeFi protocols, where digital assets are routinely used as collateral for loans. Hanke argues this model is unsound, especially if the underlying assets lack intrinsic value.
Bitcoin Rally: Detached From Value or Market Evolution?
Despite the criticisms, Bitcoin’s recent price surge paints a very different picture. BTC climbed to an all-time high of nearly $123,000, driven by institutional inflows, macroeconomic uncertainty, and increased demand for hard assets amid global bond market stress.
Supporters of Bitcoin treasuries argue that digital assets like BTC offer:
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Hedge against inflation
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Decentralized store of value
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Sovereign wealth diversification
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Increased transparency via blockchain
Companies like Strategy (formerly MicroStrategy), Tesla, and even sovereign entities such as Bhutan continue to allocate significant capital to Bitcoin, citing its long-term potential over traditional fiat reserves.
The Polarizing Debate: Is Bitcoin a Speculative Bubble or a Strategic Asset?
Hanke’s recent statements have reignited a long-standing debate in financial circles: Is Bitcoin a strategic reserve asset or just a speculative bubble?
While traditional economists like Hanke and Schiff remain firm in their criticism, newer market participants and institutional investors view Bitcoin as the future of finance. They point to increasing spot ETF inflows, growing retail adoption, and macroeconomic triggers—like rising debt-to-GDP ratios and shrinking trust in sovereign bonds—as tailwinds for Bitcoin.
It’s also worth noting that while Steve Hanke sees no business model behind Bitcoin treasuries, companies holding BTC have seen their market caps soar in line with Bitcoin’s rise. Strategy, for example, now holds over 600,000 BTC, valued at more than $72 billion, positioning it as the largest corporate holder of Bitcoin.
Conclusion: Economic Conservatism Meets Digital Innovation
Steve Hanke’s sharp remarks underscore the divide between traditional economic thought and the evolving world of digital finance. His assertion that Bitcoin treasuries hold “no fundamental value” may resonate with risk-averse investors, but the broader market continues to embrace BTC as a legitimate asset class.
Whether Bitcoin ends up proving critics wrong or validating their skepticism remains to be seen. What’s clear, however, is that the conversation around crypto treasuries is far from over—as BTC adoption grows, so too does the scrutiny.
