Bitcoin [BTC] is a self-defeating form of progress, says Nobel Prize-winning economist

Recently, Kathryn Haun, former Federal Prosecutor, and Paul Krugman, a Nobel Prize-winning economist had a ‘Let’s settle this’ debate wherein they spoke about the validation of Bitcoin in comparison to that of the US Dollar.

During the discussion, Paul Krugman stated that Bitcoin is a “self-defeating form” of progress. He continued to add that he does not understand how to make a validation system work without paying other people. The economist said:

“but the validation, someone has to be investing the resources in effect to say that this token I’ve received is a real one […] I mostly know that the dollar bill in my wallet is the real one because it’s a bit hard to reproduce.”

The main obstacle to producing high-quality counterfeit Dollar bills is that the Treasury Department’s Secret Service would track down the people. This was followed by the economist stating that the whole point of cryptocurrency is that there should not be Secret Service that validates the coin. However, this would require real resources to validate the coin.

Nonetheless, this statement was met with a dissent by the former Federal Prosecutor. She said that it was “relatively easy” to counterfeit the Dollar bills with the help of modern technology. Kathryn added that during her time as a Prosecutor she witnessed that there was a lot of counterfeit cash just in the United States. She said:

“But the fact of the matter is the resources are so strapped, the Secret Service in particular is an agency so strapped that I can’t tell you how many counterfeiters we could never prosecure. You know it’s such a small fraction of cases that you really have a Secret Service agent, it has to a mass-scale counterfeit. It’s just not the case […] if someone counterfeits a hundred thousand dollars that the Secret Service is going to investigate them.”

Kathryn further spoke about forking of a chain. She opined that at times forking is good and that sometimes it can be bad as well. She further added that there have been too many forks and systems and in some cases, everything is “splintering off”.

She also stated that in the current reality Bitcoin relies on Proof-of-Work [PoW] for mining and that this consumes a lot of energy. However, Ethereum, the second biggest cryptocurrency in the market, is shifting to Proof-of-Stake [PoS], which would result in lesser energy consumption, she added.