Paul Krugman, a crypto sceptic, suggested in a New York Times opinion post that we may see the end of crypto.
Professor of economics argued that the market was now undergoing a Fimbulwinter, not a crypto winter. Fimbulwinter alludes to Norse mythology by depicting “an unending winter” before the end of the world. In one instance, he indicated that the crypto business would perish this winter.
According to Krugman, the initial claim that Bitcoin would eliminate the need for trust has yet to materialize. This is due to the fact that banks seldom steal consumer cash, but crypto institutions are more susceptible to temptation and excessive inflation.
In addition, the Nobel laureate argued against the notion that cryptocurrencies and blockchain technology would ensure cheaper transactions, stating that this has not yet occurred.
Paul Krugman enumerated various unsuccessful efforts to tackle real-world issues using blockchain technology. Among them was Australia’s stock exchange’s attempt to employ blockchain for clearing and settling transactions, which was scrapped two weeks later with a $168 million loss write-off.
In addition, he said that the shipping firm Maersk abandoned its blockchain experiments because it was unable to handle real-world issues.
Meanwhile, Krugman argues that the popularity of blockchain technology is due to political ideology. According to him, individuals who mistrust banks, the romanticism of high technology, the dread of losing out, and the incomprehensibility of crypto itself drove the field forward.
This is not the first time Krugman has forecast the demise of crypto. In January, he lambasted corporations that jumped on the cryptocurrency bandwagon and said that Bitcoin lacks actual customers.
However, Krugman is not the only one who has forecast the blockchain’s demise. Since 2010, BeinCrypto stated that Bitcoin has been declared dead more than 465 times.