Paul Krugman Sees Bitcoin, Cryptocurrency as Useless, Wasteful, Ponzi Scheme

  • Paul Krugman has been a scathing critic of Bitcoin and other cryptocurrencies for at least a decade.
  • Nobel Prize-winning economists call them meaningless, wasteful and virtually worthless.
  • Krugman also dismissed cryptocurrencies as primarily tools for criminals and mostly Ponzi schemes.

Paul Krugman has repeatedly criticized Bitcoin and other cryptocurrencies, dismissing them as useless, wasteful, niche, and only valuable for hype and speculation.

The Nobel Prize-winning economist and New York Times columnist has accused the cryptocurrency industry of enabling crime, complicating transactions, preying on vulnerable people and operating as a pyramid scheme. I was.

Below are Krugman’s 12 best quotes on cryptography from the last decade, lightly edited for length and clarity.

1. “People believe that creating a kind of virtual currency that requires wasting real resources in a way that Adam Smith in 1776 considered stupid and obsolete was wise and not cutting edge. I’m thinking.” (“Adam Smith Hates Bitcoin”) (April 12, 2013)

2. “To be successful, money must be both a medium of exchange and a reasonably stable store of value. And why should Bitcoin be a stable store of value?” (“Bitcoin is evil”) (December 28, 2013)

3. The Enthusiasm for Cryptocurrencies Seems Very Strange Transferring bitcoin or other cryptocurrency denominations requires providing a complete history of past transactions, rather than almost frictionless transactions. Higher cost of doing business. Instead of money being produced with the click of a mouse, there is money that must be mined — created by resource-intensive computation” (“Transaction Costs and Tether: Why am I a Cryptoskeptic?”). or”) (July 31, 2018)

4. “Cryptocurrency has no backstop and is not tied to reality. Its value depends entirely on self-fulfilling expectations. If speculators were to raise their skepticism en masse, they would suddenly fear that Bitcoin is worthless. Why I am an Advocate”) (July 31, 2018)

5. “There could be a potential equilibrium where Bitcoin (probably not other cryptocurrencies) would continue to be used primarily for black market transactions and tax evasion, but if that equilibrium exists, we reach it here.” If the dream of a blockchain-enabled future dies, the disappointment will probably bring it all down.” (“Transaction Costs and Tether: Why I’m a Crypto Skeptic”) (2018) 31 July)

6. “Cryptocurrencies have been effectively marketed: Not only does cryptocurrency look futuristic, but it also appeals to old-style gold bug fears that the government will inflate your savings.” It’s been successful.The huge profits in the past have investors worried about missing out.Therefore, no one can clearly explain what the legitimate purpose of cryptocurrencies is, but they are large assets. Class.” (How Crypto Became the New Subprime) (January 27, 2022)

7. “I see jarring parallels with the subprime crisis of the 2000s. No, cryptocurrencies do not threaten the financial system. (How Crypto Became the New Subprime) (January 2022) 27th of the month)

8. “Bitcoin is a self-sufficient individualist fantasy of protecting families with personal AR-15, treating Covid with antiparasitics or urine, and managing finances with personally created money.” government or bank.” (“Guns, Germs, Bitcoin, and Antisocial Rights”) (31 Jan 2022)

9. “Cryptocurrencies play little role in economic transactions other than speculation in the crypto market itself. It’s old by tech standards; Apple introduced the iPad in 2010.” (“Cryptocurrency Crash: Is It Different This Time?”) ) (May 17, 2022)

10. “If you, like me, believe that the majority of cryptocurrencies are Ponzi schemes, this may just happen to be the moment this scheme ran out of new suckers.” (“Surprise: Wasn’t Bitcoin supposed to be a hedge against inflation?” (June 17, 2022)

11. “Jim Chanos called cryptocurrency a ‘predatory junkyard’. Well, I wouldn’t go that far. In fact, if you think about it, you would.” (“Surprise: Wasn’t Bitcoin supposed to be a hedge against inflation?”) (June 17, 2022)

12. “The way I see it, cryptocurrencies have evolved into a sort of postmodern pyramid scheme. And for a while, even with the doubled risk, it was effectively too big to be regulated. Where was he?”) (July 11, 2022)

read more: The chief investment officer of a $1.5 billion company explains how to invest in companies that will benefit from a recession and shares the top 10 overlooked stocks that helped beat the market this year.

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