Economist Nouriel Roubini, renowned for his bearish thoughts on financial markets, appears to be equally pessimistic on the fledgling virtual currency bitcoin , declaring it a "Ponzi scheme" and a "lousy" store of value.

Bitcoin - a "virtual" currency that allows users to exchange online credits for goods and services - has received criticism and praise in equal measures since appearing in the spotlight back in April last year. Seen as a libertarian movement with no central bank, the price rallied to well over $1,000 last November before regulatory moves in China and problems at major exchange Mt.Gox curbed investor appetite.

Whilst there are many high-profile advocates - including entrepreneur Richard Branson and the Winklevoss twins - its appears Nouriel Roubini, the bearish economist known as "Dr. Doom" is not one of them, using his Twitter account Sunday to list its many faults.

(Read more: How to make money from bitcoin)

"Bitcoin isn't a currency," he said. "It is (by the way) a Ponzi game and a conduit for criminal/illegal activities. And it isn't safe given hacking of it."

Bitcoins are not a unit of account, a currency, a means of payment or even a store of value, according to Roubini. He said that no goods and services were being priced in the cryptocurrency and suggested that there never would be. He added that it was a "lousy" store of value as there was "little wealth" in bitcoin, had no assets priced in it and had major price fluctuations and volatility. The price of bitcoin has lost half of its value since November and wild price fluctuations of around 50 percent in one day are not uncommon.

(Read more: Japan to regulate and tax Bitcoin trades: Nikkei )

"(Bitcoin) bugs like gold bugs are fanatics who speak of (bitcoin) in cult-like religious ways. Like gold bugs they have paranoid conspiracy views on the dollar," he said in another Twitter update on Sunday evening.

Advocates would disagree with Roubini, but even the most hardened of fans still accept that more needs to be done with this new technology. Peter Vessenes, the chairman of the Bitcoin Foundation, which is an organization set up to promote the digital currency, believes that bitcoin is truly "disruptive" and "engaging" but also warns of risks assocated with the currency.

"There are botnet operators, hackers, and Ponzi-scheme runners floating around our space," Vessenes states on the foundation's website.