Paul Krugman, a prominent critic of digital assets, took to Twitter and predicted the downfall of the world’s most famous crypto token. He described Bitcoin as a “cult that can’t survive indefinitely.”
The Nobel-prize-winning economist, a contributing author at The New York Times, has publicly criticized the digital currency. Krugman had even described the virtual asset as an evil in the past.
In his latest series of tweets, the digital asset critic argued that even though the coin has been around since last decade’s financial crisis, it has failed to build its reputation as a legal asset. He further added that the currency has a cult-like support base that may keep it going. While referring to Bitcoin, he said,
But I’ve given up predicting imminent demise. There always seems to be a new crop of believers. Maybe just think of it as a cult that can survive indefinitely.
One world’s most credible economist, Krugman, who clinched the Nobel prize for his work on global trade theory in 2008, has cited two reasons behind his scepticism – the lack of tethering and high gas fees.
In an article published three years ago, Krugman argued that crypto assets like Bitcoin have more transactional costs when compared to fiat currencies. He further argued that, unlike state-backed financial assets, virtual currencies have no reinforcement.
However, supporters of the crypto market suggest that there has been a shift in his opinions from 2018 that also predicted the market’s demise because of no backing.