Krugman Says This Bitcoin Crash Is Different. Is This Bottom Signal?
Analysis
Price Impact
HighNobel laureate paul krugman's strong negative sentiment, predicting a 'fimbulwinter' and a 'crisis of faith' for bitcoin, could significantly impact investor confidence, particularly among traditional investors and those less familiar with crypto market cycles.
Trustworthiness
MedKrugman is a highly respected economist, lending weight to his analytical arguments. however, he has been a consistent bitcoin skeptic, and in crypto markets, a 'chorus of doom' from prominent critics is often contrarianly interpreted as a buy signal signaling a market bottom.
Price Direction
NeutralWhile krugman's specific statements are deeply bearish, the article highlights that some market observers view a widespread 'chorus of doom' from long-standing critics as a contrarian 'bottom signal.' this suggests that despite the negative rhetoric, the market could be nearing a reversal point or accumulation phase.
Time Effect
LongKrugman's critique centers on bitcoin's long-term viability and fundamental flaws over a 17-year period, implying a sustained period of difficulty. conversely, a 'bottom signal' typically anticipates a long-term recovery phase rather than an immediate bounce.
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Cover image via www.flickr.com Read U.TODAY on Google News "Fimbulwinter" A bottom signal? Advertisement Nobel Prize-winning economist Paul Krugman argues that the current crypto crash differs from previous cycles due to a crisis of faith after the previous rally was driven mostly by politics. The "libertarian ideology" that historically supported Bitcoin’s floor doesn't apply now that the asset has become a "political creation." "It has bounced back several times from big declines because people had faith in it and because... there was a lot of ideology behind it. But this time looks different," Krugman said. HOT Stories Morning Crypto Report: One of Biggest XRP Sellers Revealed, -80% for Cardano (ADA): Founder Admits $3 Billion Loss, Binance Delists 20 Pairs After $2.6 Billion Liquidation Tsunami: Bitcoin Affected Too 'Be Greedy': Ripple CEO Reacts to XRP Price Crash "Fimbulwinter" Krugman claims that BTC may be facing its "Fimbulwinter", a reference to Norse mythology that describes the final winter before Ragnarok (the end of the world). Advertisement He has argued that Bitcoin is not going to be an enduring asset after the leading cryptocurrency severely underperformed gold. "…the next gold turns out to be gold, not Bitcoin. I think it's a big wake-up for people that, you know, maybe this isn't actually going to be an enduring asset," Krugman said. You Might Also Like Thu, 02/20/2025 - 05:47 Bitcoin Critic Paul Krugman Hacked to Promote Fake Token By Alex Dovbnya Advertisement "In terms of the original idea that this was actually a superior form of money, it's a total bust, and it's a 17-year-old bust. That's the thing that gets to me. This is not an idea of the future. This is not a cutting-edge technology. This is something that is only slightly younger than the first iPhone." "If it hasn't made any inroads as an actual legitimate means of payment in 17 years, then clearly, it wasn't a great idea to start with," he said. A bottom signal? During the massive crypto crash, the industry’s most vocal and long-standing critics have re-emerged to read its last rites. In the span of just 48 hours, Krugman, Nouriel Roubini, and Mark Dow have all issued statements predicting the total collapse of the asset class. As reported by U.Today , Roubini recently went as far as predicting another crypto apocalypse. Some market observers now view this chorus of doom as a buy signal. Earlier today, Bitcoin crashed to $60,255, the lowest level since October 2024, but it then managed to pare these losses. #Bitcoin Price Prediction #Paul Krugman