Steve Hanke, a professor of applied economics at Johns Hopkins University, has criticized bitcoin, stating that it is not a currency. The economist, known for his vocal views on cryptocurrencies and for promoting dollarization initiatives in Latam, criticized bitcoin, saying it has a “fundamental value of zero” and is a “highly speculative asset.”
Steve Hanke criticizes the function and value of Bitcoin
Steve Hanke, a professor of applied economics at Johns Hopkins, has criticized bitcoin and its value in one of his latest tweets. The economist, known for being very vocal about the negative effect that cryptocurrencies can have on world economies, questioned the usefulness of bitcoin, stating:
Bitcoin is not a currency. It’s just a highly speculative asset with a fundamental value of zero.
Hanke illustrated his point with a cartoon drawn by Robert Rich, as part of his work for sea urchin Risk Management, where he compares other major fiat currencies, including the dollar, yen, and euro, against bitcoin.
The Bitcoin community responds
Responses from the bitcoin community to Hanke’s views came quickly. Digital artist Lucho Poletti, known for his work focused on bitcoin, tweeted a similar cartoon depicting bitcoin as a better form of money than the fiat currencies featured in the Robert Rich cartoon.
Others criticized Hanke’s view in writing, such as Dr. Julian Hosp, CEO of decentralized finance app Cake Defi, who contradicted Hanke’s view, stating:
Bitcoin has utility. We can argue about how much, but it’s definitely >0. No doubt, there are some people who want its utility. Lastly, it is demonstrably rare. Therefore, your statement that Bitcoin has zero value is 100% wrong.
Hanke, as a promoter of currency boards and dollarization As a solution to inflation and devaluation problems in countries like Argentina, he has criticized the adoption and function of bitcoin several times.
In June 2021, Hanke criticized El Salvador’s adoption of bitcoin as legal tender, saying it could cause the country’s economy to collapse. At the time, he claimed that all dollars in El Salvador could be “emptied” of the country, leaving citizens with only bitcoin.
This criticism intensified in October 2021, when he claimed that Nayib Bukele, the president of El Salvador, was “playing fast and (loose) with El Salvador tax dollars again,” when he announced he was buying bitcoin dip while I bought 150 bitcoin.
What do you think of Steve Hanke and his critique of bitcoin adoption and its fundamental value? Tell us in the comment section below.
image credits: Shutterstock, Pixabay, Wiki Commons
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