Crypto Skeptic Krugman believes Gold has less utility than Bitcoin

At ChainXChange, a recent blockchain conference in Las Vegas, Paul Krugman joined Fundstrat co-founder Tom Lee and Ripple’s chief marketing strategist Cory Johnson on a panel focused on the future of money.

From the start, Krugman admitted he hasn’t looked at the entire cryptocurrency industry at large, and has instead focused on trying to learn how Bitcoin works. “Bitcoin is the only one I halfway understand,” Krugman said, reports Nulltx.

Prior to the discussion, Krugman delivered a presentation that focused primarily on the history and development of money, and ultimately how they relate to Bitcoin.

Krugman prefaced his criticisms of cryptocurrency with the disclaimer, “Bitcoin is the only one I halfway understand.” After explaining the fundamentals of money and how society has progressed from rocks and pebbles to gold and silver, then to paper money, and finally to digital money, Krugman compared the large amount of energy required to create Bitcoin to the mining of gold. He noted, half jokingly, that Bitcoin actually takes us back hundreds of years as a society.

Krugman then admitted that despite his concern that Bitcoin mining uses a lot of energy, the leading cryptocurrency already has more utility than gold.

“Gold is dead… Bitcoin has more utility than gold. There is some chance for Bitcoin to be valuable in the future.”

Krugman also compared Bitcoin to US$100 bills. Hundred dollar bills are seeing diminishing acceptance. The government accepts them for taxes, which he claims ensures their value, but less merchants and stores are accepting them. For drug lords overseas, Krugman believes that using Bitcoin is probably a better alternative to lugging around bags of hundred dollar bills.

When comparing Bitcoin’s utility compared to fiat, Krugman says his major issue is the cost of transactions used to transfer BTC. He believes if those fees were reduced, that would remove his primary opposition to cryptocurrency.

It was no surprise that Krugman remained skeptical on crypto, but other statements were actually quite encouraging. Of course, Krugman explained that he was talking not about blockchain technology or alternative cryptos, only Bitcoin. He also indicated that his concerns on Bitcoin are only regarding its role as a form of money. He has no opinion on Bitcoin or altcoins as utilities beyond currency.

As for the potential impact of smart contracts and other revolutionary aspects of blockchain, Krugman says he has formed no opinions on the technology beyond their potential use as a currency.