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Tyler Cowen

Cryptocurrency Is Not Necessarily the Future

Crypto assets can be either useful hedges or useful forms of payment — but not both.

Valuable, but useful?

Valuable, but useful?

Photographer: Chris Ratcliffe/Bloomberg

As Bitcoin soared to above $28,000 over the weekend, talk resumed about the promising and dramatic future of cryptocurrency. The chief global strategist of Morgan Stanley Investment Management even suggested that Bitcoin could replace the dollar as a global reserve currency.

Cryptocurrency serves some useful purposes. But there are some pretty wild speculations going around. One of the more fundamental problems is that crypto assets can be either useful hedges, or useful forms of payment — but not easily both.