What Paul Krugman gets wrong about crypto By Cointelegraph
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© Reuters In mid-November, as crypto markets reeled in the aftermath of FTX’s meltdown, Nobel Prize-winning economist Paul Krugman made use of his New York Times column to disparage crypto assets — again. Despite his unquestionable academic credentials, Krugman reiterated a common misunderstanding in his attempt to understand crypto assets — by conflating (BTC) with other cryptocurrencies.
Despite being the oldest, most valuable and most well-known member of this emerging class of digital assets, Bitcoin has a unique use case that differs widely from all others. Therefore, in order to understand this asset class as a whole, it would make more sense to choose as your starting point an asset with more tangible utility. , for instance, provides storage for digital files in a similar vein to Google (NASDAQ:) Drive or Dropbox (NASDAQ:), but in a decentralized manner. This network allows users with surplus storage to rent that capacity to other users in exchange for a fee. This fee is paid with the network’s native token, also called Filecoin. This example is far more representative of most crypto assets: a network that provides financial incentives for services in a decentralized manner, with added efficiency and reduced costs as a result of its lack of intermediaries and central counterparties. Bitcoin, however, is different.
João Marco Braga da Cunha is the portfolio manager at Hashdex. He obtained a master of science in economics from Fundação Getulio Vargas before obtaining a doctorate in electrical and electronics engineering from the Pontifical Catholic University of Rio de Janeiro.
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© Reuters In mid-November, as crypto markets reeled in the aftermath of FTX’s meltdown, Nobel Prize-winning economist Paul Krugman made use of his New York Times column to disparage crypto assets — again. Despite his unquestionable academic credentials, Krugman reiterated a common misunderstanding in his attempt to understand crypto assets — by conflating (BTC) with other cryptocurrencies.
Despite being the oldest, most valuable and most well-known member of this emerging class of digital assets, Bitcoin has a unique use case that differs widely from all others. Therefore, in order to understand this asset class as a whole, it would make more sense to choose as your starting point an asset with more tangible utility. , for instance, provides storage for digital files in a similar vein to Google (NASDAQ:) Drive or Dropbox (NASDAQ:), but in a decentralized manner. This network allows users with surplus storage to rent that capacity to other users in exchange for a fee. This fee is paid with the network’s native token, also called Filecoin. This example is far more representative of most crypto assets: a network that provides financial incentives for services in a decentralized manner, with added efficiency and reduced costs as a result of its lack of intermediaries and central counterparties. Bitcoin, however, is different.
João Marco Braga da Cunha is the portfolio manager at Hashdex. He obtained a master of science in economics from Fundação Getulio Vargas before obtaining a doctorate in electrical and electronics engineering from the Pontifical Catholic University of Rio de Janeiro.
Continue Reading on Coin Telegraph
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