Ex-IMF Economist Kenneth Rogoff Joins ‘Bitcoin Will Collapse’
Another prominent member of the financial establishment has predicted that bitcoin will crater, while still professing admiration for the technology behind it. That means that this person believes in technology but not in its value as a means to democratize the economy.
Kenneth Rogoff, a former chief economist of the International Monetary Fund, wrote in an op-ed published Monday in The Guardian. The title of the article is: “My best guess is that in the long run, the technology will thrive, but that the price of bitcoin will collapse.”
Like Jamie Dimon, CEO of JPMorgan Chase, Rogoff based his bearish take on the assumption that the world’s governments would not allow a borderless, pseudonymous system of value transfer to grow significantly. It should not be forgotten that the financial system has pushed the world economy to various crises over the years and even the moments are not guilty, attributed to the invisible hand of Capital.
Calling it “folly” to assume that bitcoin would be allowed to replace money issued by central banks, he said:
“It is one thing for governments to allow small anonymous transactions with virtual currencies; indeed, this would be desirable. But it is an entirely different matter for governments to allow large-scale anonymous payments, which would make it extremely difficult to collect taxes.” In these lines Mr. Rogoff is forgotten, that transactions carried out through blockchain technology leave their mark and can be traced, all the information remains and can not be erased, meaning that in this paragraph there are half-truths.
On the other hand, Rogoff defended the elimination of large-denomination bills as a way to combat tax evasion and aid central banks in implementing monetary policies in his book “The Curse of Cash,” published this year. It should not be forgotten that blockchain technology can help build confidence in financial systems.
For example, he went on to suggest cryptocurrency is even more suited to illicit purposes than the proverbial briefcases full of banknotes. Also, it is not known that the technology can save all the transactions made, that means that a source and a destination can be traced.
“Cash at least has bulk, unlike virtual currency,” wrote Mr. Rogoff.
Likewise, Rogoff also offered his disapproval for Japan’s recognition of bitcoin as a legal method of payment. In our opinion, this country’s option for payment can be considered as sovereign, supposed to be studied and then accepted, must be based on sovereign laws and rules.
While the government in the East Asian country has told cryptocurrency exchanges to identify customers and monitor transactions for suspicious activity, he argued that “global tax evaders” would likely attempt to acquire bitcoin anonymously and then launder it in Japan. This is an assumption of Mr. Rogoff, sustenance falls by itself technology can track fingerprints and you can find criminals if there are.
Perhaps unsurprisingly given this take, he concluded by expressing his hope that other countries won’t follow Japan’s lead. In these short lines there is a certain despair, technology and cryptocurrencies, can help users and consumers to democratize the economies of countries, where those who produce wealth can access consumer goods.
To conclude, Mr. Rogoff wrote: “Carrying paper currency in and out of a country is a major cost for tax evaders and criminals; by embracing virtual currencies, Japan risks becoming a Switzerland-like tax haven – with the bank secrecy laws baked into the technology.”
In summary in this article collected on the views of the former IMF, Mr. Rogoff, there is no equitable balance to blockchain-bitcoin technology, a lack of equity, financial systems, can perceive that innovation clothes them as a result of the emergence of these disruptive technologies. New characters will come to attack innovation, if there is not an understanding of events its benefits are attacked. New announcements are expected.
Disclaimer: This press release is for informational purposes only. Information does not constitute an investment advice or an offer to invest. The opinions expressed in this article are those of the author, they do not necessarily represent infocoin views and should not be attributed to Infocoin.