Dr. Doom Doubles Down: Roubini Says Blockchain Tech Is Balderdash
September 1, 2018 by Akshay Makadiya
Already well-known for his skeptical views towards the cryptoverse, veteran economist Nouriel Roubini furthered his talking points on the sidelines of the Blockshow Conference in Vegas. In his latest remarks, Roubini not only called out bitcoin but also its underpinning blockchain system, calling the tech and its comparisons to an early, insurgent internet “complete nonsense.”
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Here, Have Another Dash of Dr. Doom’s Cold Water
The New York University economist Roubini, better known as Dr. Doom for his bearish prognostications during the Great Recession, has once again leveled a scathing rebuke of blockchain technology, this time suggesting the tech isn’t revolutionary and is beyond over-hyped.
In a one-on-one chat with Forbes contributor Naeem Aslam, Roubini pegged Proof of Stake and scalability issues as fundamental obstacles that will hold back distributed ledger technology from achieving success.
Roubini, former senior advisor to the United States Treasury Department, told Aslam he believed comparing blockchain technology to the internet in its early stages was “completely nonsense” — a rebuke against the conventional narrative in the space that the blockchain industry now is like the industry around the internet was in the early 1990s.
Dr. Doom has seemingly been making a circuit as of late. Only a few weeks ago, back in May 2018, Roubini debated Ethereum co-founder Joseph Lubin at Fluidity Summit in New York. There, Roubini called Ethereum’s Proof of Stake “vaporware” and said tokenization would bring the world “back to the Stone Age of [bartering].”
Pushing Back, Both Ways
No technology has become a benchmark right away, of course. Blockchain technology is in its most nascent stages and may achieve further success with continued advancements in security, transparency, and trust.
However, in his latest remarks to Aslam, the chairman of the economic consultancy firm Roubini Macro Associates LLC, emphasized that blockchain’s decentralized nature may make it secure but that its core products, such as cryptocurrencies, still rely on centralized exchanges, making them prone to hackers.
As a counter-point, Aslam pointed out that blockchain tech is being embraced in pilots and within the research divisions of many of the globe’s top financial institutions. Many banks, through both consortiums and independently, are piloting the technology to test optimized transactions.
It’s a trend that may not be going away.
For example, Param Vir Singh, Carnegie Bosch associate professor of business technologies at Carnegie Mellon University, just posited that blockchain may soon underpin the “entire spectrum” of finance:
“I see banks adopting blockchain technology to improve efficiency, cost-effectiveness, and security throughout the entire spectrum of financial services.”
However, Roubini pointed out to Aslam that banks testing new technology is routine, and such a dynamic does not mean all technologies materialize and will dominate:
“There is nothing new or unique about banks testing new technologies. They test thousands of new technologies every day. If a bank throws a small amount of capital on testing a new technology, it doesn’t mean they are going to adopt it.”
‘Just a Fad,’ Says Roubini
The drama around a potential bitcoin ETF has been front and center in the ecosystem as of late, but Roubini said he wasn’t surprised at the recent ETF smackdowns.
Roubini argued the reason for the denials was because bitcoin “isn’t the real asset, it is nothing but a fad.”
Expect Roubini to be similarly defiant if bitcoin ETFs ever do pass. Dr. Doom only doubles down — he never backs down.
Should the famous economist Roubini backpedal on his standpoint of the overall cryptoverse? Share your views in the comments section.
Images via Pixabay, CNBC