Roubini and Warren tear into cryptos at US Senate hearing
Nouriel Roubini, the influential economist, and Elizabeth Warren, a potential Democratic presidential candidate for the 2020 election, both took a sideswipe at cryptocurrencies in a Senate Banking Committee hearing on Thursday.
The hearing, entitled Exploring the Cryptocurrency and Blockchain Ecosystem, introduced principal witnesses Roubini – economics professor at the Stern Business School of New York University – and Peter Van Valkenburgh – director of research at CoinCenter.
Easy to steal
Warren, the Massachusetts Democratic Senator, was among the Committee members to speak highly-critically of cryptocurrencies, saying the assets were easy to steal and that scammers were rife.
She said that a lot of small investors were being scammed by initial coin offerings and that they needed more protection.
“The challenge is how to nurture productive aspects of crypto, while protecting consumers,” the Senator said.
Mother of all bubbles
Roubini, a severe critic of cryptocurrencies and blockchain, was – as ever – scathing of both, calling the digital asset sector “the mother of all bubbles”.
He was also highly critical of participants in the sector: “Scammers, swindlers, criminals, charlatans, insider whales and carnival barkers tapped into clueless retail investors’ fear of missing out, and took them for a ride selling them crappy assets at the peak that then went into a bust and crash in a matter of months.”
He was also scathing of blockchain, calling the technology that underpins the crypto sector “the most overhyped and least useful technology in human history. In practice it is nothing better than a glorified spreadsheet or database”.
Defending the sector
Van Valkenburgh offered defence for the crypto sector, explaining the difference between public and private blockchain, adding that “only public blockchain networks can solve certain specific issues related to electronic cash, identity, and the Internet of Things”.
He likened the world’s current understanding of blockchain to the advent of the internet in the 1990s.
He said: “Just as few would have predicted the emergence of Facebook or Uber given only an understanding of the Internet circa 1995, it is impossible to know what creative and diverse minds will build when offered a free and public platform for experimentation.”