Jon Danielsson stands as the Director of the Systemic Risk Centre for the London School of Economics, and the man is convinced that crypto isn’t that useful, not really. In his mind, cryptocurrencies are mandated to provide some valuable service to justify the high valuation price. He went as far as to warn that cryptocurrencies could potentially increase inequality, as well.
Danielsson: Bitcoin Won’t Succeed If It Can’t Be Exchanged
Danielsson gave this spectacular insight through a column he published on VoxEU. There, he reasoned that Bitcoin only managed to achieve its $1 trillion valuation simply through Bitcoin investors expecting it to succeed.
In his statement, Danielsson warned that cryptocurrencies cannot succeed if they can’t be exchanged for real goods. A single Bitcoin being exchanged for $47,200 (at the time of writing) is apparently not an exchange of Bitcoin for real capital, through this logic.
Danielsson cited Tesla’s recent considerations of allowing users to pay for Tesla vehicles by way of Bitcoin payments. As such, he stated that the success of cryptocurrencies as a whole relies solely on their ability to be used within commercial transactions. It should be noted, however, that crypto payments for various services have been going steadily for quite some time now.
Current Rich Apparently Far Better Than “Bitcoin Aristocrats”
From here, Danielsson starts getting really creative. He warned that Bitcoin’s success will inevitably cause a sharp increase in inequality. He warned that people that get rich from cryptocurrencies will not be like Elon Musk or Jeff Bezos, two of the richest people in the world. The main difference, as Danielsson claimed, would be that both Musk and Bezos made their fortune by creating companies that he claims benefits the majority of individuals.
By contrast, those that get rich on Bitcoin in particular, which Danielsson cleverly calls Bitcoin Aristocrats, will become rich just because they bought it early, which is apparently a truly horrible prospect in Danielsson’s eyes.
It should be noted at this point that Jeff Bezos has been called out numerous times for the poor treatment and pay of the low-ranking workers in his companies. Danielsson Decided that Bezos was a prime example of how the rich sow money back into the poor, a concept, officially called “trickle-down economics” that’s claimed many times but never really proven to work.
An Ongoing Trend Around Legacy Financial Experts
In order to have Bitcoin work as an asset, according to Danielsson’s expert opinion on the matter, it must first have a day-to-day use for commercial purchases, but the volatility it shows hampers this.
With this, Danielsson has managed to propel himself alongside the likes of Peter Schiff in the creativity of arguments claiming crypto, and particularly Bitcoin, is a very horrid thing indeed. Another popular highlight in the list of crypto denouncers is David Rosenberg, an economist from Canada. Rosenberg declared that Bitcoin was just a “massive bubble” in a recent criticism.