Joseph Stiglitz Thinks We Should Ban Cryptocurrencies

Joseph Stiglitz

Most people know who Joesph Stiglitz is. Some know him as the 2001 recipient of the Nobel Memorial Prize in Economic Sciences; others know him as a vocal cryptocurrency bear. This week, Stiglitz is getting a lot of attention for the latter. In a May 6 interview with CNBC, Stiglitz said we should shut down cryptocurrencies.

Here’s everything we know.

Joseph Stiglitz on Cryptocurrencies: The Latest

This week, of course, is not the first time Joseph Stiglitz, 76, has discussed cryptocurrencies in a negative manner. Back in November 2017, Stiglitz told Bloomberg TV that digital currencies, especially Bitcoin (BTC), are dangerous. His reasoning was that the popularity of the crypto market is driven largely by its potential to maneuver around government organizations. He also said the Bitcoin market will eventually hit a wall, leaving hundreds of investors in treacherous territory.

One year later, Joseph Stiglitz spoke again on cryptocurrencies. This time, he said virtual currencies like Bitcoin exist “because of the abuses.”

And this week, Stiglitz is raising his concerns once again.

In an interview with CNBC, the Economics Professor at Columbia University said we should shut down cryptocurrencies. While he admits that digital payments systems have value, he fears that cryptocurrencies facilitate illicit activity.

“I’ve been a great advocate of moving to an electronic payments mechanism,” said Stiglitz. “There are lots of efficiencies.” And yet, he continued to explain that he thinks “we should shut down the cryptocurrencies,” as cryptocurrencies “do not have those attributes” of a good currency, unlike the US dollar.

Fair Points

Cryptocurrencies are similar to penny stocks in the way that both can be used to make a lot of money very quickly. But like penny stocks, cryptocurrencies have considerable risk, so it’s not unreasonable for Stiglitz to have taken the approach that he has to digital currencies. Some take a genuine approach to the crypto market, while others do, in fact, use it to participate in illegal activity. In fact, “crypto crime has gotten worse because regulations are still weakly enforced,” said CipherTrace CEO Dave Jevans.

>> Binance Hack: Hackers Make Off with $40 Million in BTC

Takeaway

Some people might brush off Stiglitz’s comments, and we can’t stop them. But this is something people should keep an eye on, considering the value of losses from crime in the sector hit $1.7 billion last year.

What do you think? Should we ban cryptocurrencies? Let us know in the comments below!

Featured image: DepositPhotos © Imaginechina-Editorial

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