Why well-distinguished economists are negative on bitcoin

[amishmanish]

Even if you hate it or have severe doubts, it can't be ignored and should be studied intensely. I would expect a vocal hater to demonstrate greater knowledge than a supporter if they're to be taken seriously, yet what comes out of their gobs is far less informed than some dark web LSD seller who's permanently high on their own supply.

Absolutely right. It'd be so much better if we can see some real academic studies on the positive and negative effects of bitcoin on world economy rather than these off the cuff remarks.

I am sure there are people out there doing exactly this. Can we talk about those things here? Last i looked, there were a few articles on the nakamotoinstitute website. What are the other serious attempts to study it?

[Hell-raiser]

One would be quite hard-pressed to find a positive thing that well-distinguished economists had to say about crypto. However, it could be argued that, since crypto is an attack on traditional economics - the field most of them devoted their lives to - they feel there is nothing that crypto, and by extension Bitcoin, can bring to the table.

I think you are mistaken in your premises. Crypto is not an attack on traditional economics because it can't compete with fiat at the global scale. Perhaps, that's the reason why you don't understand the logic behind their words and have a spite against them. If you start with an unbiased view, you may see that they have a good deal of substance behind their point of view. As far as I am acquainted with the views of people like Buffett, they consider crypto and Bitcoin in particular as mostly a speculative bubble. And let's remain honest here, so far the reality proves their words.

[amishmanish]

I think you are mistaken in your premises. Crypto is not an attack on traditional economics because it can't compete with fiat at macroscale. Perhaps, that's the reason why you don't understand the logic behind their words. If you start with an unbiased view, you may see that they have a good deal of substance behind their point of view. As far as I am acquainted with the views of people like Buffett, they consider crypto and Bitcoin in particular as mostly a speculative bubble. And let's remain honest here, so far the reality proves their words.

If your premises is correct then the economists shouldn't just be deriding something that is just a blip on their macroeconomic radars?? Why then People like Jamie Dimon, Warren Buffett feel the need to comment negatively on them??  Why exactly do you have High Networth investors raising queries to investment managers around the world?? Isn't that because crytpo is a new, currently quite wild class of investment/ money??

They don't find it palatable that people are just raising money out of thin air by burning electricity while they have been doing the same for a long time themselves.

Of course they see crypto as an attack and that's where these reactions come from.

[Hell-raiser]

I think you are mistaken in your premises. Crypto is not an attack on traditional economics because it can't compete with fiat at macroscale. Perhaps, that's the reason why you don't understand the logic behind their words. If you start with an unbiased view, you may see that they have a good deal of substance behind their point of view. As far as I am acquainted with the views of people like Buffett, they consider crypto and Bitcoin in particular as mostly a speculative bubble. And let's remain honest here, so far the reality proves their words.

If your premises is correct then the economists shouldn't just be deriding something that is just a blip on their macroeconomic radars?? Why then People like Jamie Dimon, Warren Buffett feel the need to comment negatively on them??  Why exactly do you have High Networth investors raising queries to investment managers around the world?? Isn't that because crytpo is a new, currently quite wild class of investment/ money??

They don't find it palatable that people are just raising money out of thin air by burning electricity while they have been doing the same for a long time themselves.

Of course they see crypto as an attack and that's where these reactions come from.

They may in fact see crypto as an attack on their own well-being, or they may be just envious like Jamie Dimon (whose daughter was able to earn handsomely through crypto), or whatever personal reasons they could have, I don't really know. Basically, they have just been warning common people to stay away from investments in crypto since it was a sure way to lose money as it has turned out to be. Besides, Buffett has been asked the same question since 2014 if I'm not mistaken, and that might have been quite an ordeal for him to answer it again and again.

[supermine]

No one is experts in the crypto currency field because it is a new technology,so the traditional economists are not good at predicting when it comes to crypto currencies.Or some of the economists may be the bitcoin haters so they want to dump the bitcoin by spreading the wrong news.Whatever the people say but bitcoin proves us it is worth to invest on it by its growth percentage over the years so it is now you have to make decision whether invest or not.

[amishmanish]

I think you are mistaken in your premises. Crypto is not an attack on traditional economics because it can't compete with fiat at macroscale. Perhaps, that's the reason why you don't understand the logic behind their words. If you start with an unbiased view, you may see that they have a good deal of substance behind their point of view. As far as I am acquainted with the views of people like Buffett, they consider crypto and Bitcoin in particular as mostly a speculative bubble. And let's remain honest here, so far the reality proves their words.

If your premises is correct then the economists shouldn't just be deriding something that is just a blip on their macroeconomic radars?? Why then People like Jamie Dimon, Warren Buffett feel the need to comment negatively on them??  Why exactly do you have High Networth investors raising queries to investment managers around the world?? Isn't that because crytpo is a new, currently quite wild class of investment/ money??

They don't find it palatable that people are just raising money out of thin air by burning electricity while they have been doing the same for a long time themselves.

Of course they see crypto as an attack and that's where these reactions come from.

They may in fact see crypto as an attack on their own well-being, or they may be just envious like Jamie Dimon (whose daughter was able to earn handsomely through crypto), or whatever personal reasons they could have, I don't really know. Basically, they have just been warning common people to stay away from investments in crypto since it was a sure way to lose money as it has turned out to be. Besides, Buffett has been asked the same question since 2014 if I'm not mistaken, and that might have been quite an ordeal for him to answer this question again and again.

People losing money has nothing to do with their far-sightedness or understanding of bitcoin or crypto in general. Being seasoned investors, What they do know is that common people cannot handle markets well with their well of emotions.
People who got burned in the market are the ones who invested during the ATH in the months approaching December. All the while they were being warned not to invest more than you can afford to lose. They got greedy, FOMOed or were enticed by the wild fluctuations and desire to earn money. I am sure that the next time around people will be much more cautious in investing in bitcoin or any of the other cryptos out there.

This is all still an experiment on a peer-to-peer economy. The part highlighted above is pretty much non applicable for the majority of people. It is only an unfortunate minority who had to face this. You can't just forget everything that bitcoin stands for and take the side of the likes of Dimon and Buffett because people lost money to their greed.

[Hell-raiser]

This is all still an experiment on a peer-to-peer economy. The part highlighted above is pretty much non applicable for the majority of people. It is only an unfortunate minority who had to face this. You can't just forget everything that bitcoin stands for and take the side of the likes of Dimon and Buffett because people lost money to their greed.

You can't talk about that in the affirmative. And I'm really doubtful it is an unfortunate minority. I'd rather say it is an unfortunate majority who bought at prices above $12,000. And many of them have already fixed losses and left for good. But even if they didn't, they are not guaranteed to ever come close to a breakeven. In other words, what I wrote is fully applicable so far. Things like "everything that bitcoin stands for" are wishful thinking basically. But market evidently doesn't care about that.

[krauzzer02]

Whenever there is an innovative technology solution to our current problems this so-called traditional economist and other personalities tend to conclude that this will happen blah3x they have the habit of branding such things that it will not go well, bubble, no future and so on like they know the very future of the technology and its destiny, I've read so much people say negative thoughts about other things in the past yet the present has different and revolutionary result or conclusion they are just eating their words.

[ceferov]

Well I believe they don't love BTC because it failed adopt-price graph. flying from $6k to $20k in a short time was definitely bubble thing also it could go higher on that time if bigger exchanges accepted new registrations. $10k was a psychologic line and after breaking all news channels wrote about price change and new FOMOers came. By the time with more adoption I'm sure economists will change their mind when they see the real adoption, real technology and advantages of BTC from money. The only thing people talking about BTC is it's price only not technology

[mu_enrico]

One would be quite hard-pressed to find a positive thing that well-distinguished economists had to say about crypto. However, it could be argued that, since crypto is an attack on traditional economics - the field most of them devoted their lives to - they feel there is nothing that crypto, and by extension Bitcoin, can bring to the table.

This is not a new thing, though: most great inventions were brought into the world while old people were complaining that it was all better in their day. And while the opinions of Nobel Prize awardees should count for something - who was ever stopped by that?

Here is a summary of what six of them said, with pictures:
https://cryptonews.com/exclusives/what-six-nobel-laureate-economists-have-to-say-about-crypto-1402.htm

I study a little bit of economics, imo the problem with bitcoin (and other cryptocurrency) is that it doesn't have "fundamental value"
https://www.sciencedirect.com/science/article/pii/S0165176515000890

It can be understand if mentioned six nobel laureates think that way since bitcoin cannot be valued using traditional method, but I think crypto can be valued using network strength in the form of active full nodes and hash rates, and also with frequency of transactions. However, to get nominal value from that factors is difficult.

I'm optimistic about the future of cryptocurrency though

[amishmanish]

This is all still an experiment on a peer-to-peer economy. The part highlighted above is pretty much non applicable for the majority of people. It is only an unfortunate minority who had to face this. You can't just forget everything that bitcoin stands for and take the side of the likes of Dimon and Buffett because people lost money to their greed.

You can't talk about that in the affirmative. And I'm really doubtful it is an unfortunate minority. I'd rather say it is an unfortunate majority who bought at prices above $12,000. And many of them have already fixed losses and left for good. But even if they didn't, they are not guaranteed to ever come close to a breakeven. In other words, what I wrote is fully applicable so far. Things like "everything that bitcoin stands for" are wishful thinking basically. But market evidently doesn't care about that.

I understand it'll be pretty painful for all those people who bought near that 12k- 19k run. I believe i myself did buy some fractions but then there is no point being  gloomy. Sure there is no guarantee that they'll ever approach breakeven but there is a chance they will.

We have all been screwed left, right and center by the traders, the alt-coin peddlers, not to miss the governments, hackers and the dishonest exchange operators..lol..Regardless, I still see this as a huge learning opportunity for the masses about an alternative to state control of money. This is not over by any chance.

[Proton2233]

All respected economists cannot be experts in the field of cryptocurrency. They became experts in Fiat Economics but it's a completely different kind of economy. Only people with non-standard thinking can change the world. Most often they are considered idiots because they go against the rules. For me the most is the value of the opinion of "idiots".

[trecore4]

Sometimes it is all about the popularity and sometimes it is al about the hatred that has arise because of the greatness of something. Or many times it could both the things altogether in the schrodinger box.

My belief is that these people just talk about it that way because they are not willing to make the changes to the economy which they study currently. I mean in the past it is something that made them what they are today but in the future they wont be capable of mastering that because economy is getting changed freely due to the crypto currency use. This is the reason most big people go negative about it.

[Hell-raiser]

This is all still an experiment on a peer-to-peer economy. The part highlighted above is pretty much non applicable for the majority of people. It is only an unfortunate minority who had to face this. You can't just forget everything that bitcoin stands for and take the side of the likes of Dimon and Buffett because people lost money to their greed.

You can't talk about that in the affirmative. And I'm really doubtful it is an unfortunate minority. I'd rather say it is an unfortunate majority who bought at prices above $12,000. And many of them have already fixed losses and left for good. But even if they didn't, they are not guaranteed to ever come close to a breakeven. In other words, what I wrote is fully applicable so far. Things like "everything that bitcoin stands for" are wishful thinking basically. But market evidently doesn't care about that.

I understand it'll be pretty painful for all those people who bought near that 12k- 19k run. I believe i myself did buy some fractions but then there is no point being  gloomy. Sure there is no guarantee that they'll ever approach breakeven but there is a chance they will.

We have all been screwed left, right and center by the traders, the alt-coin peddlers, not to miss the governments, hackers and the dishonest exchange operators..lol..Regardless, I still see this as a huge learning opportunity for the masses about an alternative to state control of money. This is not over by any chance.

Look, when you just learn about the great opportunities "for the masses about an alternative to state control of money", it is one thing. And it is a completely different thing when you start actually investing your "hard-earned" money in these "opportunities". It is no more about learning, it is about earning. Or losing, which is the case for the people who bought bitcoins anywhere above 10k and didn't sell at a profit when there was a possibility. Indeed, if you have an insight into the future and this future is bright for you, no matter what side of the trade you are on, you may not care what the current price is. But this is not the case for 99% of those who had been imprudent to consider themselves real traders. All they care for now is price and price alone. In simple terms, they don't really give a single fuck about those great "opportunities", even if they persuade themselves they think otherwise.

[Theb]

Can we really blame them? Economist even if they are not well-know are saying the same thing, and that is Bitcoin is a "bubble" and one day it will be over for it. Even in my school, my friends who are under the program of Economics are saying the same line of words when the topic is about Bitcoin. This is how they are thought and it is hard for them to accept something that they have still yet to tackle. Also big figures such as Warren Buffet are staying away from cryptocurrency as you can watch his interview you will see the problem BTC has over a true investor like him. These people especially the economists want to place their money on safe bets, the ones that will show fundamental figures that will determine whether it is safe or not, they don't want to rely on good or bad news as there is no assurance that it will help them determine where will the market go.

[krishnapramod]

Steven Horwitz, an economist of the Austrian School has aptly summarized why most economists criticize Bitcoin.

It’s (Bitcoin) something economists had never had to think about until this was developed, and we're just beginning to think through all the implications of it.

I guess the most important objective of microeconomics is inflation, achieving price stability through monetary policy for economic growth and then one day there is a new currency, Bitcoin, programmable money, no central authority, inelastic/deflationary, a whole new economic model.

Bitcoin has gone through multiple bubble phases and like Andreas Antonopoulos said Bitcoin grows by bubbles, a new technology, there is lot of speculation. As far as volatility, Bitcoin isn't designed to achieve perfect price stability.

Basically, it's a new economic system, somewhat exact opposite of the traditional one so it's impossible to predict how Bitcoin will evolve or its implications and the statements made by these well-known economists are based on their understanding of the existing economic model.

[BobK71]

Mainstream economists, especially the 'top' ones, have been misleading the public for centuries.

Mainstream economists praised the gold standard while central banks wanted it, and attacked gold when central banks didn't want the public to trust it.

As a group, they totally 'failed' to predict the major financial busts like the Great Depression and the Great Recession.

With all their training, they can't seem to spot that the root of economic evil comes from the distortions of the values of money, debt, and other financial assets, driven by state power used to benefit the top politicians and bankers.  Both the general and specific narratives are right under their nose, but they don't see them -- or don't want to see them.  I have pointed this out in forums full of serious economists.  All I get is silence and a few up-votes.

If you're a 'top' economist and have any negative impact on the public's trust in the money and financial systems, you won't get invited to policy councils or be recommended for awards.  By its very nature, the system will only promote those economists who give their personal ambition top priority.