Nobel prize-winning economist Robert Shiller says Bitcoin exhibits characteristics similar to previous failed currency experiments, citing attempts in the 19th century to replace the gold standard with ‘time money’.
Shiller is well known for predicting the housing and dotcom bubbles. Following in the footsteps of Jamie Dimon and Warren Buffett, he is the most recent in a long line of experienced investors to doubt the potential of cryptocurrencies. He points to the example of the ‘Cincinnati Time Store’, an experiment in the early 19th-century which attempted to sell merchandise in units of work. The experiment failed after only three years. Another experiment to sell electricity as a unit of currency also never caught on.
He believes that modern-day views of government as a long time promoter of inequality and war are no different to how they were back then, and the idea that cryptocurrency can solve these issues is not new.
None of this is new, and, as with past monetary innovations, a seemingly compelling story may not be enough,” he warns.
His opinion is that cryptocurrency, and Bitcoin in particular, is praised largely due to its mystery and that the majority of people don’t understand how it works.
While it may be true that huge gains in Bitcoin in the last half of 2017 were bolstered by an overzealous public interest, blockchain technology has been around for almost a decade and doesn’t look to be going anywhere too soon.
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