Cornell University economist says bitcoin has three major flaws

Bitcoin has major flaws which could possibly drive away people and search for better alternatives. 

This analysis came from Eswar Prasad, a professor of economics at Cornell University. 

In an interview with CNBC, he expressed his concerns about Bitcoin’s major flaws, which, according to him, would convince people to look for a better cryptocurrency. 

Three major flaws

Here are the three flaws that Professor Prasa outlined in the interview: 

First is energy usage. According to the professor, the excessive energy being used to mine bitcoins is really concerning because it creates a negative impact on the environment. 

He also pointed out that Ethereum, one of Bitcoin’s major competitors, will soon utilize a more-energy efficient method for mining, meaning, it would be more environment-friendly. And with less energy, it also means that Ethereum’s crypto-transactions can be more cost-efficient and fast. 

With this innovation, bitcoin might be left behind in the competition and risk losing its global dominance. 

Second is the anonymity myth. Prasa said that the anonymity that bitcoin provides is much weaker compared to the ones provided by other cryptocurrencies such as monero and zcash. 

Third is bitcoin’s flaws as a currency. The economist/professor shared that Bitcoin is inconvenient to use as a currency. it is slow and cumbersome for payment transactions, and on top of that, it is a volatile and highly speculative asset, which makes it a very unstable currency, he said. 

Professor Prasad, a closer look

Eswar Prasad is a professor of economics at the Charles H. Dyson School of Applied Economics and Management at Cornell University.

Prasad also previously served as chief of the Financial Studies Division in the research department of the International Monetary Fund (IMF).

 

Image courtesy of Cointelegraph News/YouTube

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