Famous economist Paul Krugman is still no Bitcoin fan, making him all the more frustrated with the latest Republican fervor surrounding the asset.
In a Monday article for the New York Times, Krugman slammed Donald Trump’s VP pick, JD Vance, as an avatar of “paranoid” Silicon Valley “tech bros,” with whom he shares a common love for cryptocurrencies.
“The truth is that Bitcoin, which was introduced 15 years ago, an eon in tech time, remains economically useless,” wrote Krugman. “A couple of exceptions to its uselessness are money laundering and extortion.”
From what the public can tell, Vance appears to be a crypto bull. He disclosed in 2022 that he owned somewhere between $100,000 and $250,000 in Bitcoin—an amount that would be worth significantly more today if he’s held onto it. In June, according to Politico, he began circulating draft legislation to overhaul crypto regulatory oversight to be more industry-friendly.
The broader Republican party, including Trump, has also become explicitly pro-crypto this year heading into election season. At the Bitcoin 2024 conference in Nashville, Trump suggested that Bitcoin’s value might one day surpass that of gold, and promised to establish a “strategic Bitcoin stockpile” if elected president.
The politician also parroted one of Bitcoiners’ most popular talking points: that rampant government spending and money printing are causing rampant inflation and are presenting a “threat to the dollar.”
Krugman, however, is of the Keynesian economic school, which encourages government spending and active management of the money supply to help stimulate economic growth. That’s part of why he sees little utility in crypto aside from dodging regulations, calling it “largely a Ponzi scheme” that doesn’t actually hedge against inflation.
The economist is now highly skeptical of Trump’s pro-crypto pivot, given that the President once held the same anti-crypto views as Krugman himself. He called Trump’s Bitcoin stockpile proposal “a government bailout for a scandal-ridden, value- and environment-destroying industry.”
He also mocked the Republican Party for promising to “end Democrats’ unlawful and un-American crypto crackdown” in its 2024 agenda. “I’m sure only a tiny handful of voters have the slightest idea what any of that is about,” wrote Krugman.
Democrats are showing signs of internal panic for not speaking to the crypto industry enough, however, precisely because digital asset holders could represent a key voting bloc.
“Crypto and blockchain technologies have an outsized impact in ensuring victories up and down the ballot,” wrote two dozen Democrats in a letter to the DNC on Friday. “We urge you to take a forward-looking approach to digital assets and blockchain technology.”