Cryptocurrency Era May Be Coming to an End

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In an opin­ion piece in New York Times, cryp­to skep­tic Paul Krug­man argued that we might be see­ing the end of crypto. 

The arti­cle “Blockchains, What Are They Good For?” dis­cussed the end of cryp­to and the use­less­ness of blockchain tech­nol­o­gy. In his view, blockchain tech­nol­o­gy has no point.

Krugman Describes Crypto Market Condition as “Fimbulwinter”

The eco­nom­ics pro­fes­sor wrote that the mar­ket was cur­rent­ly expe­ri­enc­ing not a cryp­to win­ter but a Fim­bul­win­ter. Fim­bul­win­ter ref­er­ences Norse mythol­o­gy, describ­ing “an end­less win­ter” that pre­cedes the world’s end. In this case, he sug­gest­ed that this win­ter would spell the doom of the cryp­to industry.

Accord­ing to Krug­man, the orig­i­nal argu­ment that Bit­coin would do away with the need for trust was yet to hap­pen. This is because banks rarely steal cus­tomers’ funds and cryp­to insti­tu­tions are more like­ly to be vul­ner­a­ble to temp­ta­tion and extreme infla­tion.

The Nobel lau­re­ate also argued against the idea that cryp­tocur­ren­cies and blockchain tech­nol­o­gy will guar­an­tee cheap­er trans­ac­tions say­ing this was yet to happen.

Highlighting Blockchain Failures

Paul Krug­man list­ed sev­er­al failed attempts to use blockchain tech­nol­o­gy to solve real-life prob­lems. These includ­ed Australia’s stock exchange effort to use blockchain for clear­ing and set­tling trade which was can­celed two weeks lat­er with a write-off of $168 mil­lion in losses.

Fur­ther­more, he men­tioned that ship­ping giant Maer­sk aban­doned its blockchain projects when it could not solve real-life problems.

Mean­while, Krug­man believes blockchain tech­nol­o­gy became famous because of polit­i­cal ide­olo­gies. Accord­ing to him, the space was pushed by those who dis­trust banks, the romance of high tech, the fear of miss­ing out, and the incom­pre­hen­si­bil­i­ty of cryp­to itself.

This is not the first time that Krug­man has pre­dict­ed crypto’s end. In Jan­u­ary, he crit­i­cized com­pa­nies who jumped on the cryp­to band­wag­on and claimed that Bit­coin does not have legit­i­mate users.

How­ev­er, Krug­man is not the only one who has pre­dict­ed the end of the blockchain. Bein­Cryp­to report­ed that Bit­coin had been declared dead over 465 times since 2010.

Disclaimer

All the infor­ma­tion con­tained on our web­site is pub­lished in good faith and for gen­er­al infor­ma­tion pur­pos­es only. Any action the read­er takes upon the infor­ma­tion found on our web­site is strict­ly at their own risk.

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