Nobel Economist Paul Krugman Hates Crypto, Saying 'Bitcoin is Evil', 'Set the Monetary System Back 300 Years' and is Headed for 'Collapse'

Bitcoin and crypto is taking economics backwards a full 300 years, according to Nobel Economist and New York Times columnist Paul Krugman. That's what he says in his latest column in the NYT.

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According to his noble Nobel wisdom, it's all headed for a "total collapse". It's "evil" and nothing but a con, a "cryptocon" as he has put it in the past. His skepticism and dislike of bitcoin and crypto overall just keeps growing.

For Krugman, the two main problems he sees are:

1. transaction costs
2. lack of tethering

Uhum... It seems the "wise" Nobel winning economist is not "in the know" about some things. Bitcoin might have issues with the transactions cost, and even time, but other cryptos have improved upon those drawbacks. Steem and EOS for instance, where the cost is covered by the inflation of the currency, much like fiat inflates. It's also bling-bling fast.

Bitcoin isn't the only token, as other crypto tokens DO have tethering. It seems he's a bit confused or ignorant while still putting on the hate for crypto.

Krugman favors the current monetary system, as the most evolved we have. The credit and debt cards with digital payment methods is the evolution towards a frictionless transaction economy. Bitcoin is an evolutionary regression setting us back 300 years, he says, because friction pops back up through costs of the technology like mining, and validating blocks:

Set against this history [of money], the enthusiasm for cryptocurrencies seems very odd, because it goes exactly in the opposite of the long-run trend... In other words, cryptocurrency enthusiasts are effectively celebrating the use of cutting-edge technology to set the monetary system back 300 years. Why would you want to do that? What problem does it solve? I have yet to see a clear answer to that question."

Krugman like a centralized monetary regime, like we have, in the control of govenrments. He acknowledged they have "occasionally abused the privilege of creating fiat money", but hey, it's still done a good job. The low-friction and stable purchasing power are to-dollar metrics for him to declare the fiat empire as the winner. Bitcoin sucks, because it's not a crappy medium of exchange and not a store of value. Of course not, we should all listen to you, oh wise noble lord of money!

Krugman sees crypto as the criminal money. Since it's supposed to be a "digital cash" or "digital gold", well, criminals use gold and cash for their criminal activities in order to avoid the financial system and monitoring, like for tax evasion.

Eek! Bitcoin and crypto is criminal money! Quick everyone, give it up now! Cast away this sinful evil currency and rejoice in the comfort of your paper and digital currencies that are centrally controlled blankets to suffocate you!

Fiat currencies are better. Krugman explains it all nicely, justifying it's superiority and security at the point of a gun and taxes:

... ultimately, it's backstopped by the fact that the U.S. government will accept dollars as payment of tax liabilities — liabilities it’s able to enforce because it’s a government. If you like, fiat currencies have underlying value because men with guns say they do.

From the horses mouth himself, admitting how the money system is back by men with guns and great for paying taxes to your masters.

Crypto sucks for Krugman, because they:

"... have no backstop, no tether to reality. Their value depends entirely on self-fulfilling expectations – which means that total collapse is a real possibility. If speculators were to have a collective moment of doubt, suddenly fearing that Bitcoins were worthless, well, Bitcoins would become worthless."

He says that the guns and tax use means the "value isn't a bubble that can collapse if people lose faith." But, all money only has value because of faith in it's value. The only reason the US dollar is still valued so high and not representing real economic realities, is because of the faith, trust, loyalty and belief in it's value. That could change at any moment.

I don't think this guy really understands what he's talking about. A Nobel Economist? Seems like his title is as worthless as Obama's Nobel Peace prize.

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Thank you for your time and attention. Peace.

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References:

• Bitcoin is Erasing 300 Years of Monetary Evolution: Nobel Economist Paul Krugman
• Transaction Costs and Tethers: Why I’m a Crypto Skeptic
• Bitcoin is Evil
• Paul Krugman Ignorantly Calls Bitcoin “The Long Cryptocon”

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