Paul Krugman: the cryptocurrency will throw the financial system for 300 years ago

Bitcoin again criticize winners of the Nobel prize. One of the most famous economists of our time, Paul Krugman gave an interview to The New York Times, which stated that the main bitcoin will never replace money. This writes the Ethereum World News.

What is FUD

While most of the industry supporters of cryptocurrencies argue that the blockchain is the main innovation in the world of Finance, Krugman is still among the skeptics. The analyst believes Bitcoin is a threat to the normal development of the world financial system.

The enthusiasm for crypto-currencies looks very strange, as it contradicts the global long trend. Instead of a quick transaction, we get a system that is too expensive to maintain, because Bitcoin keeps a full history of previous transactions. Instead of creating money with one mouse click miners are spending resources on the production of the same money in a more costly way.

Moreover, Krugman claims that Bitcoin does can erase the last three hundred years of progress in the global financial system.

In other words, cryptomnesia happy technology that toss monetary system on 300 years ago. What problem they want to solve? What will this give us? I don’t see the answer to this question.

Analysts believe that a positive reputation is the driving force to increase the confidence in the traditional financial system. Earlier world governments often exceed their authority in question to issue currency. On the other hand, banks should provide quality services, to profit from clients. At the same time, Bitcoin has no source of confidence that would keep the whole system afloat.

You need a digital version of biting a gold coin to verify its authenticity. Accordingly, production cost of each bitcoin will only grow.

The expert also supported the view of another analyst, Peter Schiff, who believes in the absence of the real value of cryptocurrencies.

Cryptocurrencies are not binding to the physical world. Their value depends entirely on expectations of market players. If all they at one point decide that Bitcoin is not worth anything, its price will fall to zero.

Recall that Krugman is a staunch opponent of the crypts for a long time. He is still in 2013, publicly called the issue of digital assets “diabolical.” In our cryptodata so, of course, I do not.

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