Nobel Prize-winning economist Paul Krugman A perennial winter of possibilities for blockchain projects involving crypto. In a recent article published in The New York Times (NYT), The Economist criticized blockchain as a technology and pointed to its uses with some signs ahead of this winter.
Paul Krugman compares Crypto Winter to Fimbulwinter
Nobel laureate Paul Krugman is a blockchain-based project that includes Bitcoin and other cryptocurrencies It warns about the coming eternal crypto winter for the network. In his NYT opinion article published on December 1, the economist discusses the practical utility of this technology and how there are already signs predicting its future decline. I am arguing.
Krugman criticizes the true usefulness of this technology when there are other centralized alternatives that currently work very well. To this, Krugman explained his skepticism, stating:
What’s the point?”
This and the recent downfall of one of the world’s largest cryptocurrency exchanges, FTX? Based on this, Krugman believes that this crypto winter could result in a complete abandonment of blockchain and cryptocurrency technology. He compared it to Fimbul Winter, the winter that precedes the end of the world according to Norse mythology.
Signs of Disintegration
For Krugman, the last few months have seen some signs of this abandonment. Economists cite recent write-offs made by several companies, including Maersk and the Australian Stock Exchange, on their blockchain-based projects as part of the justification.
Krugman also openly criticized Bitcoin’s raison d’etre, stating: chaos. “
In the same vein, Krugman evoked Bitcoin’s Proof of Work (PoW) consensus, estimating the damage it caused to the environment at tens of billions of dollars. A worthless token.”
However, this opinion differs from the one he expressed in May 2021. At the time, he expressed that he did not believe in the fundamentals behind Bitcoin, but believed the market was a “cult.” It can survive indefinitely. In June, he likened cryptocurrencies to the housing bubble and subprime mortgage crisis, saying, “It’s a house built on nothing, not on sand.”
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