Yuval Harari comments about Bitcoin

By Vladan Lausevic | CryptoVlad | 19 May 2024


 

Yuval Noah Harari, a distinguished historian and best-selling author, recently voiced his concerns about Bitcoin at the Bank of International Settlements (BIS) Innovative Summit 2024. His opinions have sparked widespread criticism from the crypto community.

Harari criticized Bitcoin by saying, "When I look at Bitcoin, I don't like it because it is money built on distrust. We don't trust the banks, the governments, so we don't want to give them the ability to create as much money as they like, so we create this Bitcoin." 

He acknowledges that Bitcoin represents the future of money but argues that the traditional system of money creation by banks and governments fosters more trust within society. "I think that the future belongs to electronic money, but what we have seen over the last centuries is that it's actually a good idea to give banks and governments the ability to create more and more money to build more trust within society," Harari said.

Charles Hoskinson, the co-founder of Cardano, responded on social media, describing Harari's analysis as "Dunning-Kruger on steroids." The Dunning-Kruger effect refers to individuals who overestimate their competence in a subject they need to be better versed in.

While Harari believes that government and bank-controlled money creation builds societal trust, this perspective overlooks significant issues with traditional monetary policies, particularly quantitative easing (QE). QE involves central banks creating money to purchase government bonds and other financial assets to stimulate the economy. However, this policy often increases public distrust due to perceived mismanagement and economic inequality.

Central banks' extensive use of QE policies, especially since the 2008 financial crisis, has exacerbated public distrust in governments and financial institutions. These policies have often led to asset bubbles and wealth disparity, contributing to economic instability and public skepticism.

Cryptocurrencies like Bitcoin offer an alternative by creating trust in a decentralized manner. Unlike traditional systems where trust is placed in central authorities, cryptocurrencies rely on blockchain technology to ensure transparency, security, and immutability.

 This decentralized trust model allows individuals to transact directly with one another without needing to trust a central authority, which can be prone to corruption and mismanagement.

Harari's concerns reflect a traditional view of financial stability, they fail to address the growing disillusionment with centralized financial systems. Cryptocurrencies offer a revolutionary way to build trust through decentralization, providing a more transparent and equitable financial system. As public confidence in government and bank-controlled money wanes, the decentralized nature of cryptocurrencies could represent a more trustworthy alternative.

 

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Vladan Lausevic
Vladan Lausevic

Based in Stockholm, Sweden as a social entrepreneur. Working with decentralization of democracy, climate transformation and economy. For more info, please get in touch with me via [email protected]


CryptoVlad
CryptoVlad

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