A Nobel-winning economist has predicted that Bitcoin will go to zero within 10 years.

Eugene F. Fama, who is often dubbed as "The Father of Modern Finance," told the Capitalisn't podcast that this digital asset's rise has "a predictable ending."

He argued that it would prove "unsustainable" to have a whole financial system built using blockchains because this would require too much computing power—and "all we know about monetary theory" suggests cryptocurrencies shouldn't survive.

"Cryptocurrencies are such a puzzle because they violate all the rules of a medium of exchange," Fama said. "They don't have a stable real value. They have highly variable real value. That kind of a medium of exchange is not supposed to survive."

With a fixed supply of 21 million coins, Bitcoin has been positioned as a form of "digital gold" and a hedge against inflation, rather than a cryptocurrency suited to everyday payments. But this argument doesn't hold much weight with Fama either.

"It's only digital gold if it has a use. If it doesn’t have a use, it's just paper. Not paper, it's air, not even air," the economist said.

Bitcoin is now the seventh most valuable asset in the world, with a total market capitalization nearing $2 trillion, according to a list maintained by Infin...