Harvard economists admit their mistakes: three major misjudgments led to the failure of the Bitcoin $100 prediction, questioning Trump's encryption asset conflict of interest.

Harvard University economist and former chief economist of the International Monetary Fund (IMF) Kenneth Rogoff openly admitted that his prediction ten years ago that Bitcoin would fall to $100 had "fundamental flaws." He analyzed three major misjudgments: underestimating Bitcoin's role in the vast global underground economy, misjudging the direction of U.S. pro-crypto monetary policy, and not anticipating that policymakers would hold large amounts of crypto assets, thus creating conflicts of interest. Today, the price of Bitcoin has exceeded $115,000, in stark contrast to this prediction.

Ten Years Ago's Wrong Predictions and Three Major Misjudgments

In 2018, Rogoff predicted on the American CNBC television that Bitcoin "is more likely to be worth $100 in ten years, rather than $100,000." This prediction has been proven to be completely wrong by reality. The core of his initial argument was that government regulation would eliminate Bitcoin's main use cases in money laundering and tax evasion, leading to its price collapse. In his new book "Our Dollar, Your Problem," he explains in detail the three key misjudgments in Bitcoin price predictions that led to the failure of his forecast.

Misjudgment 1: Overly Optimistic Expectations for U.S. Crypto Assets Regulatory Policy

The first major mistake pointed out by Rogoff is that he is "overly optimistic about the U.S. returning to reason on sensible encryption regulation." The anticipated regulatory crackdown has not materialized; instead, the Trump administration has enacted landmark pro-Crypto Assets legislation, including the GENIUS Act, CLARITY Act, and CBDC Anti-Surveillance State Act.

• The "GENIUS Act" establishes the first federal regulatory framework for stablecoins, requiring them to be fully backed by US dollars and implementing formal consumer protection measures.
• The "CLARITY Act" transfers the jurisdiction of digital assets from the U.S. Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC), providing a clearer definition of regulatory roles for crypto asset exchanges and traders.

Misjudgment 2: Underestimating Bitcoin's Dominance in the Global Underground Economy

Rogoff acknowledged that he did not fully recognize how "Bitcoin would compete with fiat currency to become the preferred medium of exchange for the $20 trillion global underground economy." This demand has created a price floor for Bitcoin, as it has captured market share from traditional cash-based illegal transactions. Despite ongoing regulatory pressures, Bitcoin is increasingly serving these unregulated markets, and this transactional utility provides real-world value beyond speculation, thereby undermining Rogoff's initial assumption that eliminating illegal use cases would destroy Bitcoin's price.

Misjudgment Three: Ignoring the Seriousness of Political Conflicts of Interest

In addition, Rogoff did not forget to point out the "Yin and Yang" of Trump: he expressed surprise at the situation where "regulators, especially chief regulators, can openly hold hundreds of millions (or even billions) of dollars in Crypto Assets without seeming to bear any consequences (considering their obvious conflicts of interest)."

Trump's Crypto Assets Empire Validates Concerns Over Conflicts of Interest

President Trump's substantial holdings of crypto assets confirm Rogoff's concerns about regulatory conflicts. Trump has $1.2 billion in crypto wealth through various projects, including $430 million in various wallet assets, $390 million from World Liberty Financial, and $315 million from his TRUMP Meme coin. Trump Media & Technology Group holds approximately 18,430 Bitcoins, worth $2.1 billion, accounting for 40% of its company valuation, making it the sixth largest corporate holder of Bitcoin in the world. The timeline of Trump's accumulation of Crypto Assets aligns with his administration's regulatory reforms, including the appointment of crypto-friendly SEC officials and the establishment of a strategic Bitcoin reserve plan. About 20% of current Trump advisors actively hold cryptocurrencies. Democrats on the House Financial Services Committee criticized Trump for "rewriting the rules and then profiting from the chaos he helped create." The crypto industry donated over $26 million to Trump's political action committee.

Industry Critics: Government Dependence Deviates from the Original Intention of Encryption

Despite Rogoff's change of stance, he has become an exception compared to other well-known Bitcoin skeptics like Warren Buffett, Jamie Dimon, Paul Krugman, and the late Charlie Munger. However, regarding the issue of government involvement, criticisms within the industry, such as from blockchain investigator ZachXBT, argue that the reliance on often inept law enforcement by the government to recover stolen funds, as well as the industry's acceptance of the "normalization of theft," highlights structural problems that government intervention cannot solve and may even exacerbate, which goes against the founding principles of cryptocurrency independence.

Conclusion

Kenneth Rogoff's public admission of error profoundly reveals the complexity of predicting the digital currency market. It is driven not only by technology and market sentiment but is also closely intertwined with the global macroeconomic landscape, geopolitical factors, regulatory policy uncertainties, and unpredictable personal interest factors. The policy shifts during the Trump administration and the substantial holdings of Crypto Assets by its team have brought the issue of conflicts of interest in policy-making to the forefront, raising deep concerns about policy independence and the future direction of the crypto industry. Even if critics change their views, the fundamental tension between centralization and decentralization that cryptocurrencies face in their development process still exists.